Exploring the contributions of informal ethnic entrepreneurship to economic development in Nigeria

Abstract

The purpose of this chapter contribution is to discuss the contributions of informal ethnic entrepreneurship to Economic Development in Nigeria with specific focus on three ethnic entrepreneurial groups-Igbo, Yoruba and Hausa-Fulani. Using qualitative research method, the study leverages secondary and primary data sources. For the review of literature, relevant secondary data on ethnic entrepreneurship were sourced from scholarly articles, texts and relevant online resources on the subject. For the primary data, the authors gathered the required information from 47 interviewees using purposive sampling technique. The collected data were critical reviewed using content analysis. The paper found that the contributions of ethnic entrepreneurs in Nigeria include self-employment and employment of others, provision of local goods, rendering of services and urbanisation. Secondly, the nature of ethnic businesses are retailing, traditional food processing and provision of basic services. Thirdly, the locations of ethnic entrepreneurs in Nigeria include Lagos, Aba, Abuja, Onitsha, Nnewi, Kano, Kaduna and Ibadan; while their locations outside Nigeria are US, Dubai, UK, Canada, China, Malaysia, Singapore, Canada, South Africa, Sierra Leone, Benin, Ghana and other African countries. Fifthly, the ethnic entrepreneurs remain informal because of poor access to funds, limited exposure, fatalistic psyche, poor technical skills, low technology compliance, weak managerial knowledge and inability to meet regulatory requirements. Finally, the challenges facing ethnic entrepreneurship include access to finance, biases, discrimination from indigenes, limited technical capabilities, financial literacy, multiple taxes, low risk awareness, substandard packaging, sophisticated financial system, technological advancement, low competitiveness and threat of globalisation. To redress the highlighted challenges, the paper recommends a number of interventions from governments and other critical stakeholders at national, regional and international levels.