WORKING CAPITAL FINANCING UNDER THE STRUCTURAL ADJUSTMENT PROGRAMME (SAP): A CASE STUDY OF QUOTED MANUFACTURING FIRMS IN NIGERIA
WORKING CAPITAL FINANCING UNDER THE STRUCTURAL ADJUSTMENT PROGRAMME (SAP): A CASE STUDY OF QUOTED MANUFACTURING FIRMS IN NIGERIA
No Thumbnail Available
Date
1994
Authors
LAWAL, ALIYU MOHAMMED
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
The Structural Adjustment Programme (SAP) is a
house hold word in, Nigeria. It represents an
economic "War" on households and firms who
supply the households w i t h goods and services.
Two years after the introduction of the structural
adjustment programme in 1986, it became obvious
that many manufacturing firms had collapsed
while some reduced their levels of activity such
that plant capacity Utilisation in this sector was
input at an average of 32.5 percent. The Manufacturing
Association of Nigeria attributed the low capacity
utilisation inadequate working capital.
The purpose of this study therefore, is to identify
factors that will enhance working capital flow
to the manufacturing sector within the context of
the structural adjustment programme..
A sample of twenty (20) firms was selected from the
Stock Exchange Official list. Data were collected
through questionnaires. The variables studied
include:
Business operating cycle, volume of Investment in
working capital, sales volume, Bank Credits and
source of raw materials. Tools of analysis
were the simple correlation, Mann-whitney U-Test,
i i i
Kendall Coefficient of concordance, percentages and
proportions.
Base on the data, collected and tested, we confirmed
that there is a positive and significant relationship
between business operating cycle and working
capital requirement. Our analysis revealed that
firms still depend on bank Loans and overdrafts
to finance working capital needs while others such
as debt - factoring and invoice discounting are
yet to be fully exploited.
Base on our findings we have recommended measures
that could shorten the manufacturing and operating
cycles so as to reduce the quantum of funds required
for working capital purpose. We also recommend
actions that could be taken by the controlling
agencies of government and the Nigeria Stock
Exchange which would enhance the flow of shortterm
funds to the: manufacturing sector.
Such recommendations include, the establishment
of Industrial Credit Guarantee Scheme and greater
equity participation Commercial Bank in manufacturing
ventures.
Description
A PROJECT SUBMITTED IN PARTIAL FULFILMENT OF THE
REQUIREMENT FOR THE AWARD OF MASTERS DEGREE IN
BUSINESS ADMINISTRATION, TO THE DEPARTMENT OF
BUSINESS ADMINISTRATION AHMADU BELLO UNIVERSITY,
ZARIA.
1994
Keywords
WORKING CAPITAL,, FINANCING,, STRUCTURAL,, ADJUSTMENT,, PROGRAMME (SAP):, QUOTED,, MANUFACTURING,, NIGERIA.