WAYS IN WHICH THE GOVERNMENT PARTICIPATES IN ECONOMIC ACTIVITIES

WAYS IN WHICH THE GOVERNMENT PARTICIPATES IN ECONOMIC ACTIVITIES

  • Establishment of financial institutions: Government participates in economic activities by establishing financial institutions to grant overdraft and loans to private and public enterprises, e.g. Central Bank and Industrial Banks,

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  • Establishment of public corporation: Public corporations are established by government to provide essential goods cc services for the welfare of the people

Import monopoly: Government can also participate in economic activities by exercising monopoly over certain items importation – a system in which government is the only agency that carries or
import certain goods for economic reasons.

Enactment of appropriate laws: Government can also participate in economic activities by the enactment of appropriate laws which govern the smooth operation of certain business activities.

Granting of tax holidays: Government can grant tax holidays to companies by way of attracting entrepreneurs to set up business.

Provision of social amenities: For economic activities to thrive, government must provide social amenities like roads, electricity, water and telecommunications.

Indigenization policy: Indigenization policy is a process by which government makes the indigenes of a nation to participate actively in the running of major or sectors of her economy

Nationalization policy: In nationalization policy, government tries to make sure that that state controls the ownership and management of key industries.

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