Meaning Of Economic Development Planning: Objectives And Reasons For Economic Development Planning

Economics

Topic: Element Of Development Planning

Table Of Contents

  • Meaning Of Economic Development Planning
  • Objectives Of/Reasons For Economic Development Planning
  • Nigeria’s Planning Experience (Pre-Independence Period)
  • Post Independence Period

What Is Economic Development Planning?

Economic development planning is the government conscious formulation of economic policies, allocation and mobilization of domestic and foreign resources to the various sectors of the economy and for various projects over a period of time to ensure quick, smooth, & rapid over all development of the economy.

Economic planning is the government conscious formulation of economic policies for the equitable allocation of resources to achieve rapid economic development.

It involves the mapping out of strategies by the government to achieve quick overall economic development.

Note: Nigeria adopted this system as the surest and most direct route in the pursuit of her economic progress due to the failure of market mechanism to provide a proper guideline.

Reasons For Economic Development Planning

Here are the objectives of economic development:

1. To Achieve High Rate Of Growth In National Income: Economic development planning is meant to make the growth in national income much higher than the growth in population.

2. To reduce reliance on foreign goods.

3. Diversification Of The Economy: Through planning, other sectors of the economy that is neglected will be brought to stream, thereby relieving the economy from depending on a particular sector or product for it’s revenue and expenditure.

4. To reduce inflation i.e to stabilize prices.

5. To Bridge The Gap Between The Rich And The Poor: This is done through the distribution of income.

6. To provide more employment opportunities.

Nigeria’s Planning Experience (Pre-Independence Period)

Nigeria’s development planning dates back to the colonial days i.e pre-independence period. The first plan of development and welfare was 1946-1955. This was drawn up and executed by the colonial civil servants & it cannot be seen as development plan because it was highly centralized and meant to guide the allocation of colonial investment projects, development and welfare funds. The constitutional & structural change of Nigeria which led to the introduction of federal system of government in october 1954 made it imperative for seperate development plan to be drawn for each region. This led to the launching in April 1955 (after the worlds bank report, which identified the plan’s shortcomings, the plan was terminated in 1955) of the second development plan in Nigeria titled “The economic programme of the government and the federation of Nigeria 1955-1960”. The plan were made into five for each of the regional governments, southern camerouns and the federal territory. It was revised in 1958 and extended to 1962 when the first true national development plan was launched.

Post Independence Development Plans

1. The First National Development Plan (1962-1968)

This was launched in june 1962-1968. It was set in motion prior to the achievement of political independence. This envisaged expenditure of 拢67. 6m (N1,352 m). The plan was extended to january 1970 due to political crises, creation of midwest region and the ensuring civil war, the biafran war of succession. It was then revised to $11,83m (N2366m) about 50% of the expenditure was expected to be from external source, loans, grants, aids and private foreigm investments.

2. Second National Development Plan (1970-1974)

This plan, the fourth in the series was launched in september 1970. Is was for the period of 1970-1974 with an estimated expenditure of $1,596 billion (319.2 b). The political crises of 1966 and the outbreak of the civil war 1967 brought the first national development plan to an inconclusive end. The crises & war also delayed the formulation and implementation of the second national development plan which was launched in september 1970, as the public sector allocated N1560m and private sector received N1524 million.