This study was carried out to to evaluate the Entrepreneurship and socio-economic development in Oron municipality, Using 10 selected SMEs in Uyo, Akwa Ibom State as case study. Specifically, the study aimed at ascertaining the role of entrepreneurship and managerial capacity in the economic development in Akwa Ibom State of Nigeria; identify the factors affecting entrepreneurship and managerial capacity in contributing to the socio-economic development of Akwa Ibom State; evaluate the extent to which entrepreneurship and managerial capacity have contributed to the socio-economic development of Akwa Ibom State; identify problems or constraints that militates against the growth and development of entrepreneurship in Akwa Ibom State. The study employed the survey descriptive research design. A total of 50 responses were validated from the survey. From the responses obtained and analysed, the findings revealed that Entrepreneurship plays a crucial role in the economic growth and development of any nation. In order words, there is a veritable link between entrepreneurship development and economic development. Furthermore, the T-Test result shows there is no significant difference between the role of entrepreneurship and economic development in Akwa Ibom State. The study recommend Policy makers should recognize the essence of entrepreneurship to economic development. Entrepreneurship deserves equal emphasis as is being placed on science and technology; it is the entrepreneur that translates the innovation in science and technology into wealth. Thus, entrepreneurship should be recognized as an important factor of production just as land (raw materials), labor and capital (liquid and physical), since it is only the entrepreneur that can combine all the other factors to produce wealth.
1.1 BACKGROUND OF THE STUDY
The viewpoints of scholars and researchers on African entrepreneurship tend to differ greatly. Some claim that, for whatever reason, entrepreneurial skills involved in the establishment and management of manufacturing enterprises for productive activities in the real sector of the economy is insufficient in Africa. According to Nil-,-Henrik March’s 1995 World Bank report, the dismal economic record of most Sub-Saharan African nations, notably the sluggish rate of industrialisation, might be used to justify such a gloomy view. Supporters of this position may point to the fact that the economic policies that have been put in place During the two to three decades following political independence, many African countries did not always encourage private enterprise. This is in line with a third-place finish. According to Adjebeng-Asem (1989), the African entrepreneur is still alive and well, but instead of working in manufacturing, he or she has been steered to non-productive, rent-seeking activities known as commercial entrepreneurship by scholars.
Despite this critical gap in Africa’s development, experts and intellectuals worldwide have long highlighted the importance of entrepreneurs and entrepreneurship in national economic development. Dozie (2005), for example, maintains that this vital component of production was at the heart of Joseph Schumpeter’s (1934) basic thesis, which established that no nation would overcome development difficulties without a critical mass of entrepreneurs. This argument, which served as the basis for the Schumpeterian model of economic growth, has helped many industrialised and developing countries accelerate their development by focusing on appropriate incentives to foster entrepreneurial activity (Dozie, 2005). By breaking new ground, entrepreneurs provide the critical drive an economy requires for economic advancement. Individuals flourish in human endeavour because of the key qualities or attributes they possess. Unfortunately, despite more than four decades of import substitution strategy, structural adjustment programme commercialization and privatisation of ailing state-owned enterprises, and general economic decline, Nigeria’s manufacturing sector continues to contribute very little to GDP. It is hampered by low productivity and low-quality production. This is worsened by the accompanying increase in import competition, which has led to the downsizing or outright failure of some industrial enterprises.
As a result, the success of the private sector reconfiguration as an engine of economic growth is dependent on the encouragement and development of indigenous technical entrepreneurship. Furthermore, theoretical and empirical research has demonstrated the crucial importance of technological innovation and technical entrepreneurship in supporting economic advancement. These studies are now recognised as crucial and necessary components of technical policy and economic planning.
Entrepreneurship is intrinsically linked to small and medium-sized enterprises (SMEs), which are the fundamental developing force in developed market economies and serve as a springboard for industrial growth and economic expansion (Stefanovic et al, 29).
Entrepreneurs not only have the capacity to assure self-reliance in industrial growth by depending on local raw resources, but they also produce more employment per unit of investment and ensure even industrial development, including rural regions (Roy & Wheeler, 36). As a result, governments at all levels in Nigeria, including the Akwa Ibom state government, are expanding efforts to stimulate entrepreneurship growth through the expansion of initiatives that give financial and technical assistance to entrepreneurs. In Nigeria as a whole, entrepreneurship accounts for more than 90% of manufacturing job opportunities and more than 70% of overall employment created each year (Onwumere, 20). In fact, SMEs have the potential to serve as a vehicle for wealth creation, job creation, entrepreneurial skill development, and long-term economic development in Nigeria, as entrepreneurs’ creativity and ingenuity in utilising the country’s abundant non-oil natural resources will provide a sustainable platform/springboard for industrial development and economic growth, as is the case in industrialised and economically developed societies (Van Praag and Craese, 2004). It is also worth mentioning that the United States of America, China, Germany, Japan, and other highly industrialised nations place a heavy focus on entrepreneurship and small and medium-sized enterprises (SMEs) as engines of industrial growth and economic advancement (Robichaud et al, 51). As a result, every growing country, including Nigeria, should adopt similar policies. Indeed, the entrepreneurial success stories of India, Malaysia, Indonesia, the Republic of Korea, Brazil, and Singapore, among others, could serve as a stimulus to Africa’s less developed countries, notably Nigeria (Ebiringa, 211). The need to uncover the potentials and roles of the entrepreneurship sub-sector in Nigeria’s industrial and economic growth remains a problem worthy of scientific investigation, therefore the necessity for this study to determine the role of entrepreneurship in Akwa Ibom state’s economic development.
In practically every country or state, entrepreneurship is a source of pride. Because of their critical roles in the development and prosperity of many economies, they have been aptly described to as “the engine of growth” and “catalysts for socio-economic transformation of any country.” Entrepreneurship is a legitimate vehicle for attaining national economic goals like job creation and poverty reduction at a low investment cost, as well as developing entrepreneurial abilities like indigenous technology. Access to infrastructural facilities brought about by the presence of such enterprise or organisation in their surroundings, the stimulation of economic activities such as suppliers of various items and distributive trades for items produced and or required by the entrepreneurs, resulting from rural urban migration, and the improvement of the standard of living of the private enterprise’s employees and their dependants are other intrinsic benefits of vibrant entrepreneurship.
With a population of approximately four million people, Akwa Ibom State is Nigeria’s most populous oil-producing state. Since independence, Akwa Ibom State’s economic development plans have generally aligned to the country’s economic growth goals. Akwa Ibom State inherited a number of state-owned industrial, commercial, financial, and service firms when it was created in 1987. However, because this was a time when global thinking favoured private-sector-led economic development over government ownership of commercial and industrial institutions, and especially because publicly owned enterprises in the state had long folded due to mismanagement and corruption, the state’s industrial sector was virtually non-existent at the state’s inception. However, over the years, there has been a surge in entrepreneurship activities in the state in various fields of human endeavour such as oil and gas, haulage, maritime activities, shipping, trading, ICT, agriculture, construction, and so on, which has served to provide gainful employment for citizens and boost socioeconomic development.
1.2 STATEMENT OF THE PROBLEM
The current emphasis by government and stakeholders on indigenous technical innovation and entrepreneurship stems from the failure of previous attempts to stimulate development by borrowing or transferring advanced, and sometimes inappropriate and sustainable, technologies from developed countries through the import substitution strategy. Adjebeng-Asem (1989) argued that governments in most developing economies, including Nigeria, were criticised for paying insufficient attention to the need for accelerated economic growth and for failing to harness the abilities of their own citizens for technological innovation and entrepreneurship.
Critics also claim that these emerging nations rely on external technology that are unsuitable for their environment (ibid, 1989). Nigeria’s exports have been mostly reliant on raw materials and semi-manufactured items, with the petroleum sector being the most important. On average, less than 5% of these exports are associated with knowledge-intensive goods and services. Akeredolu-Ale (1975), Adjebeng-Asem (1989). The issues were serious in the 1980s and early 1990s, when Nigeria endured stagnant industrial output and declining crude oil prices, and industrialization via indigenous technical development became important concerns in industrial policy discussions.
As a result, the United Nations Development Programme (UNDP) and the United Nations Industrial Development Organisation (UNIDO) argued that for Nigeria to join the league of industrialised economies, industrial activities must converge and focus more on knowledge-based production, particularly in the small scale manufacturing and processing industries. This viewpoint was partially articulated in the numerous development national budgets, rolling plans, and current reform initiatives elaborated in the Federal Government of Nigeria’s National Economic Empowerment and Development (NEEDS) (2004). The policy’s core concept has been that small-scale industries should lead the nation’s push towards economic recovery. According to studies, small industries in many nations serve as a vehicle for boosting indigenous entrepreneurship, increasing possibilities per unit of capital spent, and assisting in the development of local technology. Nils-Henrik and March (1995), Sule (1986). In Nigeria, small-scale firms account for over 90% of the industrial sector in terms of enterprise number (Ajayi, 2002). Similarly, they have made major contributions to economic growth through employment, job creation, and sustainable living. The Nigerian Investment Promotion Commission was established in 2003. Despite their importance and contribution to the national economy, small industries face several challenges and limits in supporting their development and expansion.
Another impediment to the modernisation of small industries is the continuation of low levels of technology, a scarcity of and insufficient entrepreneurial skills among operators, and the lack of effective management approaches. Their low product quality makes it difficult for them to compete in a globalised economy that is technologically driven, knowledge-based, and export-oriented. As a result, enhanced commercialization or technology transfer of research discoveries is required to capitalise on the significant R&D activities that take place at universities, polytechnics, monotechnics, and other public and private sector research institutes. This, however, can only be accomplished through a purposeful intervention approach aimed at building a core set of qualities among small industry operators in order to improve production efficiency, quality, and output. The failure of previous efforts by small industry operators, combined with the government’s lack of intervention, necessitates an examination of why indigenous technical innovations, management practises, and other key success factors in business are frequently not translated into viable business ventures, despite the country’s technological need. According to Akeredolu-Ale (1975), Afonja (1986), and Adjebeng-Asem (1989), these concerns suggest a relationship between technical innovation, embryonic entrepreneurship, and a much larger degree of technological growth. The current study concentrated on a specific element of the relationship between nascent entrepreneurial qualities and their impact on the development and evolution of small-scale manufacturing companies. Against this backdrop, the research examined the influence of entrepreneurial traits on socio-economic development.
1.3 OBJECTIVES OF THE STUDY
This study hopes to achieve the following objectives:
1. To ascertain the role of entrepreneurship in the socio-economic development in Akwa Ibom State of Nigeria.
- To identify the factors affecting entrepreneurship capacity in contributing to the socio-economic development of Akwa Ibom State.
3. To evaluate the extent to which entrepreneurship have contributed to the socio-economic development of Akwa Ibom State.
4. To identify problems or constraints that militates against the growth and development of entrepreneurship in Akwa Ibom State.
1.4 RESEARCH QUESTION
1. What is the role of entrepreneurship in the socio-economic development of Akwa Ibom state?
2. What are the factors affecting entrepreneurship and managerial capacity in contributing to the socio-economic development of Akwa Ibom State?
3. To what extent has entrepreneurship contributed to the economic development of Akwa Ibom State?
Ho: There is no significant difference between the role of entrepreneurship and socio-economic development in Akwa Ibom State
Hi: There is significant difference between the role of entrepreneurship and socio-economic development in Akwa Ibom state.
1.6 SIGNIFICANCE OF THE STUDY
The importance of this study is to determine the roles of entrepreneurship and management talents in the private sector in Akwa Ibom State’s economic growth.
The work would also expose the researcher, government, and the general public to difficulties impeding entrepreneurship growth and thereby influencing socioeconomic development in Akwa Ibom State and Nigeria in general, as well as viable solutions to these concerns.
The findings of this study would assist the government in carrying out more purposeful and result-oriented planning on the growth of entrepreneurship in Akwa Ibom State and the nation in general, with the goal of increasing its contribution to the improvement of the Nigerian economy.
The study’s postulation and generalisation can lead other researchers to further literature on the roles of entrepreneurship in the social and economic development of Akwa Ibom State.
1.7 SCOPE OF THE STUDY
The study will analyze the the impact of Entrepreneurship on socio-economic development in Oron municipality. The study will cover all the resident of Oron Local government area of Akwa-ibom state. Hence, the respondents for this study will be obtained from and among residents in the study area.
1.8 LIMITATION OF THE STUDY
In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. However, the researcher were able to manage these just to ensure the success of this study.
1.9 OPERATIONAL DEFINITION OF TERMS
This is done for clearer understanding of this project, some of the key terms used are defined below in order to bring out their operational meanings in the context in which they are used.
ENTREPRENEURSHIP: Entrepreneurship is the process of starting a business or other organization. The entrepreneur develops a business model, acquires the human and other required resources, and is fully responsible for its success or failure
ECONOMIC DEVELOPMENT: Economic development is the sustained, concerted actions of policy makers and communities that promote the standard of living and economic health of a specific area. Economic development can also be referred to as the quantitative and qualitative changes in the economy.
CAPITAL: form of wealth capable of being employed in the production of more wealth
SMEs: are businesses whose personnel numbers fall below certain limits.
ORGANIZATION: This is an entity that is made up of various departments coming together to achieve a common goal. It is a structured process in which people interact for objectives.
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