Theory question 104
Government and BusinessCommerce 2 (answer five questions)
(a) Distinguish between nationalization and indigenisation
(b) State any five advantages of nationalization and two objectives of indigenisation
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(a) Nationalisation: government takes over ownership and control of private businesses, usually with compensation. Indigenisation: transfer of ownership and control of businesses from foreigners to citizens of the country (private Nigerians), e.g. by the Indigenisation Decrees.
(b) Advantages of nationalisation (any five): provides essential services at fair prices; avoids exploitation by private monopolies; strategic industries kept under national control; profits go to the government; economies of scale; employment and even regional development; investment in projects too large or unprofitable for private firms.
Objectives of indigenisation (any two): give Nigerians greater participation and control in the economy; keep more profit within the country; develop local entrepreneurs and managers; reduce foreign domination.
Make the distinction in terms of who takes over (government vs citizens).