The ISMED Model and Public - Private Partnerships in the Promotion of Agro-Industrial Clusters in Nigeria

Abstract

Several studies on African small enterprises have analysed the growth constraints of small firms in the region (Hansohm, 1992; Mead, 1994). Some studies show that small enterprises in the region cannot sustain employment creation because they tend to generate low income (Livingstone, 1996; Daniel and Mead, 1998). In a compara- tive analysis of relative firms seize and economic growth, Beck et al (2005) findings revealed that the contribution of SMEs in economic growth in the transition and sub- Saharan African economies are relatively weak compare to SMEs in Latin America and South East Asian countries. With exemption of South Africa, SMEs in sub- Saharan Africa have been marginalised from the share of global income because they lack the capabilities to improve performance or sustain competition (Wohlmuth, 1991, Fafchamps, 1994). The study conducted between 2003 and 2008 in South Eastern Ni- geria used different approaches and empirical methods to investigate these claims and counter-claims in four agro-industrial sectors. Three unique findings emerged from the study: a) small enterprises cluster with high degree of informality character- istics can be active and as well be competitive in local market by using different strategies to overcome external competitive pressure. b) Regionalisation processes and liberalisation of the market in sub-Saharan African countries have led to in- creased trading networks across the borders of Anglo and Franco phone countries in African sub-regional market. c) Innovative activity in small enterprises in sub- Saharan Africa is a survival strategy in an open economy. The major problems identi- fied in the study are weak firm technological capability, low skilled labour force and Absence of linkage with large firms.