Why Nigeria’s industrial clusters are losing traction 

Industries, Trade and Investment

Typical examples of industrial clusters are Aba leather cluster (Abia), Aba fabrics cluster (Abia), Kano leather cluster (Kano), Nnewi cable and spare parts clusters (Anambra), Apapa cluster (Lagos), and Ikeja cluster (Lagos)

 

 

The state of Nigeria’s clusters raises more questions than answers. Many of the clusters are hard hit by poor road networks while others are battling with lack of funding and poor access to market.

For starters, an industrial cluster harbours manufacturing firms or companies carrying out similar industrial-related activities. According to the United Nations Industrial Development Organisation (UNIDO), firms in a cluster produce similar or related goods or services and are supported by a range of dedicated institutions located in spatial proximity such as business associations and technical assistance providers.

In a working paper, the Bank of Industry (BOI) explained that industrial clusters would provide a platform for enterprises to share infrastructure, equipment and knowledge, leading     to   economic transformation.

For the purpose of this piece, industrial clusters will be seen as a group of manufacturing firms localised in a particular industrial environment.

Typical examples of industrial clusters are Aba leather cluster (Abia), Aba fabrics cluster (Abia), Kano leather cluster (Kano), Nnewi cable and spare parts clusters (Anambra), Apapa cluster (Lagos), and Ikeja cluster (Lagos).

Others are Amuwo-Odofin cluster (Lagos), Ogbaru cluster (Anambra), Kaduna leather cluster (Kaduna), and Agbara cluster (Ogun), among many others.

The challenges of each cluster are mostly similar, but sometimes different. Starting from Lagos, Nigeria’s industrial epicenter, Amuwo-Odofin cluster is unfortunate to be located close to Apapa and Tin Can ports, where entry and exit are nearly impossible. Company vehicles struggle to deliver raw materials to the factories or finished products to the customers.

Like the Apapa cluster, workers and their managers park their vehicles far away and then negotiate to their factories with commercial vehicles or other means of transportation.

Culled from BusinessDay

Read more: https://businessday.ng/business-economy/article/why-nigerias-industrial-clusters-are-losing-traction/

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