WORLD ECONOMIC DEVELOPMENT AND PLANNING

WORLD ECONOMIC DEVELOPMENT AND PLANNING

PERFORMANCE OBJECTIVES

At the end of this chapter, students should be able to:

 Explain the meaning of economic development planning.

  • Differentiate between types of economic planning.
  •  Explain the importance of economic planning in National development.

 DEFINITION OF ECONOMIC PLANNING

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Economic planning may be defined as government’s conscious formulation of economic policies for the allocation of resources to all sectors of the economy over a period of time. This brings about sustained growth in the economy.

            AIMS AND OBJECTIVES OF ECONOMIC PLANNING OR REASONS WHY COUNTRIES EMBARK ON DEVELOPMENT PLANS

  •  To increase the level of employment: A good economic plan will ensure the increase in the level of employment in the economy.
  • To develop efficient technology: A good economic plan can promote a better and efficient technology.
  •  To increase the real income of citizens: The real income of the citizens can easily be increased through  a good economic planning.
  • Equitable allocation of resources: Development plan is aimed at equal allocation of the country’s resources to all sectors of the economy.
  •  Diversification of the economy: Through good development planning, Nigeria’s economy will be diversified to many sectors.
  •  To bridge the gap between the rich and the poor: A good economic planning ensures distribution of income more evenly among individuals and the socio-economic groups.
  •  To achieve economic self-sufficiency: Through good development planning offers the essential mechanism for overcoming some obstacles to economic development.
  • To ensure economic growth: Development planning offers the essential mechanism for overcoming some obstacles to economic development
  •  To reduce foreign control of the economy: A good development planning will assist to reduce foreign control or dominance of the nations economy.
  • To ensure joint business participation: A good development planning will increase the participation, of citizens in the ownership and management of productive enterprises
  • To reduce rural-urban migration: A good development planning will also ensure that movement of people from rural to urban centres is reduced.

TYPES OF ECONOMIC PLANNING

There are different types of economic planning and they are:

his type of economic planning involves the distribution of national income to various sectors of the economy.

Strategic planning: This is the type of planning which is directed to meet certain objective in the economy.

Comprehensive economic planning: This is the type of planning aimed at setting some targets to cover all major aspects of the national economy.

Partial economic planning: This is the type of planning targeted at specific segment of the national economy e.g. plans to boost agricultural production.

Controlled economic planning: This is also known as authoritarian planning common with socialist economic system in which government formulates and executes plans for the economy.

WAYS OF FINANCING ECONOMIC DEVELOPMENT IN NIGERIA

Internal borrowing, e.g. from banks.           

Aids and grants from international economic organisations.

Loans from international financial institutions, e.g. IMF and World Bank. 

Government savings and reserve.

Debt conversation.

Through budget surplus.

Revenue generated from investments.

Privatisation and commercialisation of government-owned business enterprises.

PROBLEMS ASSOCIATED WITH ECONOMIC PLANNING IN WEST AFRICA

Problems facing development planners or associated with economic planning in West Africa include:

  • Political instability: Political instability or frequent changes in government often leads to change in plans.
  • Inadequate capital: Inadequate capital makes economic planning difficult to achieve.
  • Misplacement of priorities: Resources are sometimes diverted to investments that yield no economic benefit to the people.
  • Insufficient statistical data and information: Insufficient statistical data and information, which implies that most of the planning is done on wrong projection, is a problem associated with it
  • Inadequate skilled personnel: Inadequate skilled labour and experts make plan implementation difficult.
  • Rapid population growth: The emergence of rapid population growth destabilises planning.

Reliance on foreign aid: Over reliance on foreign aid and adherence to their condition lead to plan failures.

Corruption and nepotism: Economic planning is affected by corruption and nepotism. Planned decision may be influenced by selfish and parochial considerations.

Poor implementation plans: Unexpected, sudden increases in the cost of projects compared to original estimates affect planning.

Fluctuation in foreign exchange: Fluctuation in foreign exchange earning on which plans are based may hinder implementation of economic plans.

Burden of national debt: This burden of national debt can also affect the implementation of economic plans.

Inadequate harmonization: Inadequate harmonization of the private and public sectors can also affect economic planning.

Under-utilization of labour: The services of skilled labour and experts are under-utilzied while making use of unskilled labour. For this reason, projects are inadequately studied and not well implemented.

        NIGERIA’S PLANNING EXPERIENCE

Development plan is a document that contains the policy framework and programme for the development of a country within a specific period of time. The plan sets national objectives and priorities in development and outlines the programmes and projects that will achieve such.

Economic planning has been recognized by the government as an instrument of economic development. It has come to be accepted as an essential and pivotal means guiding and accelerating economic growth within the framework of the economy by improving the functioning of the market, removing all the obstacles to development, which will result in the improvement of the standard of living of the people.

Nigeria has had several development plans since 1962. They are as follows:

  • (1962 – 1968): The first national development plan of 1962 – 1968 envisaged a total investment of nearly N2.4billion and half of this amount was to come from external sources.
  • The second national development plan (1970-1974): The second national  development plan of 1970 – 1974 envisage a total investment of 62.0 billion by the government. This amount later revised to 6 3.27billion.
  • The third national development (1975 – 1980): The third national  development plan of 1975 – 1980 initially envisage a total investment 6 10.7billion but this was later revised in 1976 to 643.3billion.
  • The fourth national development plan (1981 -1985): The fourth national development plan of 1981 – 1985 envisage a total investment or  capital expenditure of 6 82.0billion. Of this amount, 6 70.5 billion went to the public sector while 611,5billion was allocated to the private sector of the Nigerian economy.
  1. factors affecting the expansion of industries
  2. bud
  3. mineral resources and the mining industries
  4. demand and supply
  5. types of demand curve and used
  6. advertising industry
  7. factors of production
  8. entrepreneur
  9. joint stock company
  1. RINDER PESTS
    148. NEWCASTLE DISEASE
    149. BACTERIA DISEASES
    150. ANTHRAX
    151. BRUCELLOSIS
    152. TUBERCULOSIS
    153. FUNGAL DISEASES

PROTOZOAN DISEASES
155. TRYPONOSOMIASIS

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