THE STRUCTURE OF KANO ECONOMY

Dr. Badayi M. Sani
(Senior lecturer, Department of Economics, Bayero University Kano)

and

Sa’id Sulaiman
(Principal Lecturer, Economics Department, Kano state College of Education, Kumbutso)

Previously written also for www.kanoonline.com, which was sponsored by Kano Forum (Inuwar Jama’ar Kano), Kano, Nigeria

1.0 INTRODUCTION

 The area known as Kano state was created in July 1967 out of the defunct Northern region. The area had and still has a location advantage as the centre of commerce and terminus of trade with some African regions especially Africa as well as the Arab world.

Despite changes in the administrative structure and size of the Kano State due to the creation of Jigawa State out of it in 1991, the importance of Kano as commercial center has not been eroded. There is still a concentration of middle men and agents in the famous Kurmi, Kwari and Muhammed Abubakar Rimi (Sabongari) markets who distribute finished goods of manufactured in different parts of Nigeria and the rest of the world.

Apart from its striving commerce, Kano economy consist of a booming agricultural sector established since the groundnut Pyramids or the colonial era, and an industrial sector that is yet to regain its status since it was destroyed by the effects or SAP in the late 1980’s and early 1990’s. The teeming population of Kano drives the economy as it provides readily available cheap labor and a ready market for most of the produced goods.

The structure of the Kano economy is to be considered under three major components: resource endowment upon which the economy depends; economic activities which keep the economy moving; and the problem militating against the growth and development of the economy; as well as entrepreneurship.

THE STATE’S ENDOWMENTS

Kano is blessed with natural and man-made endowments which support and form part of its economy. The natural endowments are explained below.

LAND RESOURCE AND CLIMATE

Kano State is endowed with a land area of 20,760 square kilometers. The state lies in the tropical wet –and- dry climatic zone. The average annual rainfall is about 1000mm in the southern part of the state, 800mm around metropolitan Kano and about 600mm in the north-east. The rainy season usually covers the months of April and October. This is followed by harmattan which usually begins in November and ends in March.

Kano state is endowed with rivers and many dams which make irrigation farming possible. The rivers include Thomas, Gari, Watari and Challawa rivers. The dams include Tiga, Kafin chiri, Bagauda, Dambata and Bagerai dams. There are also three dams located along Kano-Gwarzo Road.

The Falgore game reserve measuring about 32 kilometers along the Kano - Jos Road is the largest forest in the state it serves as game reserve and tourists centre. Small grazing reserves like the Badume Grazing reserves along Kano Katsina road are also in existence. Kano state is endowed with a number of mineral resources; these include Kashin, alluvial tin, Mica, Columbines, Copper, clay and gold. Others are Silica Sand, quartzite, granite, lead, limestone, iron-ore and hyalite. (Kano State ministry of commerce n.d). These natural endowments accounts for the varied economic activities that are carried out in Kano state.

HUMAN CAPITAL

The size and quality of human capital required to support and sustain economic activities in the state depend on the size of the of the population, the level of training and education given to people as well as the lining and health standards available.

According to the 1991 census figures, Kano state is the second largest state in Nigeria in terms of population. The population was then pat at 5,633,040 people with the growth rate of 2.8%. The state is predominantly peopled by the Hausa-Fulani ethnic groups. Other ethnic groups include Nupe, Kanuri, Yoruba, Igbo Tir, Idoma and Igala. There are also foreigners from neighboring African nations. Like Niger Republic, Ghana and Cameroon, a sizeable number of Sudanese, Lebanese and Turkish people.

In terms of other education Kano state has 2,209 primary Schools, 241 Post primary schools, 4 technical colleges. There are 5 state-owned tertiary institutions and a Federal University. There are also over 500 private schools which supplement of the effort of government in educating, and empowering the populace.

In the health sector, the state has established 14 general hospitals, several comprehensive health centers, about 300 dispensaries, 200 leprosarium clinics and 4 dental centers all in addition to many private hospitals and clinics. (Kano state The peoples Vision of Development, 1997). These facilities ensure a high skill man-power for the state economic activities.

PHYSICAL CAPITAL AND ENTREPRENEURSHIP

Physical capital is made up of machinery, plant and working tools. Kano state is endowed with wealthy businessmen and women with enough of this capital, capable of caring sole proprietorship, partnership and joint stock businesses. Most of the banks in Nigeria have branches in Kano and this enhances the availability of credit facilities to businesses in the state. With the present economic downturn, there are many physical assets such as individual buildings, machines and are lying idle.

Entrepreneur ability is very high among the people of Kano; they could be rated as second to the Igbo people of eastern Nigeria. But it most be stated here that the average Kano entrepreneur is risk averse, hence will go for activities with shouter gestation period like commercial activities.

OTHER FACILITIES

Kano state id blessed with a network of roads, telephone facilities. Pipe bore water and electricity which all contribute to the development of its economy. This does not in any way suggest that their provision is inadequate. There is also an international airport and an export processing zone (EPZ) established by the federal government.

From the proceeding discussion so far, the following table exposes the predominant features of the Kano state, which direct its economy. 

TABLE 2.1 MAIN FEATURE OF KANO ECONOMY 

Source: Kano State Commercial publication.

MAJOR ECONOMIC ACTIVITIES OF THE KANO ECONOMY

Given its rich endowments, various and multi-facet economy activities that are being undertaken in Kano state. These activities can be grouped under the following sectors:

1. Agriculture

2. Commerce

3. Manufacturing

4. Mining

5. Banking and Insurance

6. Tourism and Recreation

7. Services

AGRICULTURE

Agriculture is the largest sector in Kano state in term of provision of employment and income to its populace. Over 70% of the working populations are directly or indirectly engaged in agricultural activities which include clearing of Lands, Wet season farming, irrigation Farming, storage and distribution of farm produce and annual husbandry.

The state has the following as the main crops being produce: groundnut, Guinea corn, Maze, Sugarcane, Gum Arabic, Rice, honey, ginger, pepper, coloring leaves, sugarcane herbs and   different kinds of vegetables. The Livestock comprise Cattle, Sheep, Goats, and Donkeys Camels and Horses are reared in the state.

About 90% of the Land in Kano state is arable. There are very few areas covered with rocks, thick forests or water that can not be used for faming.

Kano state has the largest irrigation projects in Nigeria. The irrigation infrastructure includes the following:

i). Kano River irrigation project phase 1 which arrears 22,000 hectares.

ii). Water River irrigation project

iii). Gwarzo Road Dams project

iv). Kafi chiri Dam irrigation project

V). Thomas River project

vi). Gari River irrigation project

By 1999, Kano state had constructed 22 earth dams which provide water for domestic, industrial and irrigation purposes (Kano state: the people vision of developments 1997).

The rich potentials for the agricultural scenario in Kano state (arable and grazing Land) supports agricultural activities of subsistence and commercial magnitudes. For instance as at 1987, there were over 13 agro-allied companies in the state meant only to satisfy the agricultural needs of farm implements, fertilizers, and storage facilities. (KSC/H, 1987) These companies have increased with time alongside the expansion of agriculture activities.

The agricultural products of the state support the food needs of the state, acts as a source of raw material for the industrial sector, fully complemented by large scale importation to supplement the food need and industrial uses. It must be mention here that not all the agricultural products are consumed within the state, as some are exported to foreign countries and other parts of the country. Predominant among these are livestock, species and vegetables. The agricultural activities in the state, flourish more in the southern part of the state, which is wetter and has an average rain fall 1000mm supported by other favorable climatic elements, than in the northern part of the state which has an erratic rainfall and high temperature due to metropolitan and industrial activities.

The intensity of agricultural activities in the state has led to the development of specialized market within the Kano metropolis for agricultural products. The table below highlights some of agricultural product-specialized markets in the state. 

Table 1  Specialized (Agricultural Products) Markets Within The Kano Metropolis:

COMMERCE

Commerce is the second largest sector of the Kano economy. The state has for long been rated the second to Lagos state in terms of commercial activities. This state has witnessed tremendous growth in large, medium and small scale commercial outfits. The commercial activities includes the sale and distribution of imported and locally made goods such as textiles, cosmetics, chemicals, pharmaceuticals, spare parts, vehicles, buildings materials and electronics.

There are many outlets by which commercial activities take place. These include:

a. The Muhammed Abubakar Rimi and Kurmi markets

b. Specialized markets in Kano metropolis

c. Rural markets

d. Community base markets in the metropolis

e. Corner shops and supermarkets

The Muhammed Abubakar Rimi market, popularly known as Sabongari market, is the largest market in the state. It is meant for the selling of general provisions, confectionary, textiles, electronics, and vegetables, stationary and general foodstuff. In an effort to decongest the market, sellers of grains and woods had to be transferred to other locations in Kano metropolis, where they have now emerged as specialized markets. The market is still in need of similar efforts due to further congestion.

The Kurmi market is an ancient market, where locally made goods and ancient technology becomes dominant. The market is located in the old city and it is a centre of tourist attraction. Honey, butter, leather work, embroidery and other locally crafted materials are also sold in the market.

The specialized markets in Kano metropolis include the following:

(i).  Yan lemo market:    This is located at Mai kalwa along Zaria Road; it is a place for the whole sale of banana, Orange, Mango and water lemon. Commodities are brought to the market for sale from other states in Nigeria.

(ii). Yan - Kaba Market: This is located at Yan - kaba quarters along Hadeja road; this is a centre for the sale and distribution of tomatoes, pepper, Onions, Carrots and other vegetables. Potatoes are also a main commodity in the market.

(iii).  Kofar Ruwa Market:          This is a market for building materials and spare parts for vehicles. It is located close to the kano international airport and is dominated by the Igbos.

(iv). Dawanau Market:  This is a market for grains, Yams and other foodstuff. It is located along Katsina Road.

(v). ‘Yan katako market: There are two markets located at Naibawa along Zaria road, and Bachirawa along Kastina road specially meant for the sale of different varieties of wood for making furniture and other wood works.

(vi). Kofar Wambai market: This market specializes in second hand textile materials, plastics, clocks, calculators and wrist watches. There are however some other products but not in great qualities.

(vii). Kwari market:          This is a market for locally made and imported textile materials. It is located close to Ibrahim Taiwo Street and is dominated by the Hausa and Arabs.

(viii). Rimi market: this is market for foodstuffs sold in small quantities (retells trade). It is also a place for the sale of Kitchen utensils and dishes.

(ix). Kwanar Dawaki market: it is as an international market for Cattle’s, Sheep’s, Camels, Goats and other livestock.

(x). Mariri markets: There are two markets at Mariri, one is for Kola nuts, while the other is for Firewood.

The Rural markets in Kano state also make a great contribution to the economy of the state; in fact, they are source of income and employment to many rural dwellers. These markets are opened on specialized days. Fridays are mostly common market days. For instance, the markets in Kura, Rano, Bichi and Wudil towns operate on Fridays. Sundays are market day for Dambatta and Kachako markets, while Badume market operates twice in a week; Sundays and Wednesdays. The Gezawa and Tudunwadan Dankadai markets operate on alternate days. Rahama and Darki markets operate on Saturdays and Thursdays respectively.

The community Based markets in Kano metropolis provide convenience for people residing in particular communities or hamlets when making small shopping. The Sharada, Sheka and Adakawa markets are example of these markets.

Corner shops and Super markets are also important outlets for commercial activities in Kano state. They provide employment and income to many people. There are many of these shops along major roads in the state (e.g. Zoo Road, Curt Road, Gyadi-Gyadi, Mandawari Sabon titi Road). Supermarkets owned by Nigerian citizens have now replaced those established by the multinational firms, the former include Zango stores, Sahad stores, and shele

Supermarket, while the latter include Leventis stores and Kingsway.

Street hawking and petty trading are very prominent in Kano state. There are many people who earn a living through these businesses.

While hawking is a general phenomenon in Nigerian cities and towns, a distinguishing characteristic of hawking in Kano is the fact that it involves to a great extent children, which is by all standard often called child abuse since it involves the use of child-labour. In Kano, a majority of street hawkers with kola nuts, and groundnut are young girls below 15 years of age. Also a good proportions of pure-water hawkers are young boys below the age of 14 years. Hence, it is observable that substantial income is raised in such activities, to the extent that a number of families of the immigrant population of Kano state, leaving predominantly in Sabongari, survive on the incomes raised by the children hawkers. High-way roundabout are common sites for hawking activities.

Another aspect of commerce in Kano state that is yet to gain academic credence is that carried by women in the pudahs. Most of the Hausa and the Fulani women are traders. They carry out retail activities especially in the spheres of food items, textiles including dresses, Jewelries and utensils. These activities go on in the pudahs and raises substantial income to these women. These particular commercial activities have escaped national income fecundating, and have for now eluded theoretical considerations, since they are carried out most often unnoticed.

MANUFACTURING

The industrial sector of an economy is usually the barometer used for measuring the extent of the country’s economic progress in terms of growth and development. In Nigeria, industrialization has been retarded by various factors eminent in the various political regimes that have governed Nigeria. In respective of this, Kano state has for long been known for its industrial activities and is still been rated as the second leading industrial centre in Nigeria after Lagos. Though, the state has witnessed a massive decline in its industries, and industrial activities, in line with the national trend, the state can still boast of over 350 large and medium industries. Industrialization which connotes manufacturing is engage in various transformation activities such as:

A. Food processing

B. Biscuits, Sweet and Confectionaries

C. Cement, Blocks, and Tiles Manufacturing.

D. Metal, Wood, Aluminum product manufacturing.

E. Plastics and Allied products manufacturing.

F. Soap, Perfume and Cosmetics manufacturing

G. Bicycle manufacturing and Assembly

H. Soft drinks manufacture.

I. Paper mills, Books and Stationary

J. Tanneries and Leather works

K. Textile and Apparel industries.

L. Agricultural and Agro allied manufacture.

M. Chemical and Pharmaceuticals.

With the recognition of industrialization as an important strategy for economic growth, various incentives were offered by the Federal Government to industrialists. In this light, the government established Export Promotion Zones (EPZ) and Industrial Estates. The existence of Sharada Industrial Estate, Challawa Industrial Estate and Bompie Industrial Estate just to mention a few, are evidence of this fact. In addition to these incentives, the Kano state government offered a wide range of incentives to prospective industrial investors in the state. The kano state government encourages establishment of industries with bias for utilization of the state blessed agricultural products, for import substitution, increase export, labour intensive and other local raw materials. Along this policy, the state government came up with the following incentives to investors;

1. Free land for industry and staff quarters,

2. Free feasibility studies, profiles and professional advice,

3. Tax exemption by the government

4. The government continued support and encouragement.

The main thrust of this policy, was to ensure even development in all areas of the state and provide effective utilization of local raw materials for mass-production and distribution of goods and service to the satisfaction of both domestic and international markets.

With all these incentives provided by both the Federal and Kano state government, modern industries expanded significantly in Kano, until late 1980’s and early 1990’s, when Kano and other parts of the country witnessed a down turn in industrialization due to the effects of SAP. The existence of modern industries in Kano producing a wide range of conventional products implies that a modern industrial sector exist side-by-side traditional industries. The traditional industries are specialized in producing semi-manufactured goods such as groundnuts oil and cake, sheanut Dutts, cotton seed oil, Animal feed, Cow horn Tips, leather, sesame seed oil, proto blocks, animal, fish, diary, pellet (animal) and poultry feeds, clothes, soft drinks, and other processed foods. Again the roles of Hausa/Fulani women in their matrimonial homes, guided by culture are brought to play. These women carry out a handful of the above activities.

As aforementioned, modern industries expand rapidly in Kano, to the extent that Kano was host to over 2500 industries until the late 1980’s when rapid decline in the industrial sector was witness in Kano. So many reasons account for the decline in industrialization in Kano. Among these reasons, the prominent ones are explained below:

 (I)   WRONG AND INCONSISTENT MONETARY POLICIES OF THE COUNTRY

(a)  Devaluation and exchange rate policies with the introduction of SAP in 1986, firms were forced to look inwards for raw materials, machinery and equipment when the raw materials were either inadequate or unavailable as most of the industries rely on imported inputs and machinery. Coupled with me low exchange value of the Naira obsolete plants can not be repaired or replaced due to prohibitive cost of importing them. This has caused many firms to close down not only in Kano but all over the Federation.

(b) Financial Sector Reforms:- This policy that affects the financial sector in terms of liberalized interest rate, foreign exchange deregulation in terms of acquisition and utilization have also negatively affected the survival of firms in terms of high cost of funds either invisible funds or working capita;. Unpatriotic Banks have also channeled foreign exchange to individuals that will use them for unproductive activities and not to industry. They have also given incentives to manufacturers to disengage in manufacturing and resort to distributive tradeand foreign exchange trading.

(c) Liberalization- Policy: - This policy in the name of making our industries competitive internationally has also caused industrial decline not only in Kano but in the whole country. Given the state our industries and the environment in which they operate there is no way we can make them to compete on equal terms with more mature and long established industries with superior and higher quality products from south East Asia and other advanced countries. The end result of this policy is that most of our industries have closed or have became distributors and marketers of these imported substitutes because they earn a higher margin by doing so.

The other problem associated with liberalization / free trade or open door policy is that Nigeria has become a fertile ground for countries like China, India Indonesia and other East Asian countries for operationalsing successfully their "dumping policy. This suggests that they have been dumping their inferior and low quality products (unknown to our consumers) at a very low price either on account of creating consumer brand loyalty or as a deliberate policy by their home government to heavily subsidize exports so as to keep jobs and other industries running.

The other negative effect of liberalization and export promotion strategy is that Nigerians were given an incentive to export every available resource in the country including raw materials that are needed by our industries and this obviously compounded their problems -as the prices of these raw materials became high and the cost of production of the firms. Consequently raw materials became scarce and their prices high, so also the prices of manufactured products and this has resulted to high level of unplanned inventories.

The policy of liberalization and export promotion was also associated with an incentive to exporters to use the foreign exchange they earn freely. This gave them an impetus to import foreign substitute consumer goods that are cheaper and more qualitative than those produced by our industries resulting in further deterioration of industrial activities not only in the state, but in the whole country.

Another aspect of liberalization that have caused the col lapse of industries not only in Kano but in the whole country is the liberalization of the foreign exchange market either through a deliberate policy of devaluation as we witnessed in 1986 when SAP was introduced or in the present day where we are told that the value of our N is determined by the Market forces and therefore Government has not been influencing the continuous depreciation of the N/$ exchange rate which presently stands in the range of between N140 to N150 to a dollar compared to N100 or less 2 years back. It is common knowledge to all of us that our industries are import dependent particularly in terms of raw materials, spare parts and machinery. Moreso, most of their products are not sold in dollars. So imagine the huge discrepancy that may exist between their cost & revenue and the implications for their survival. Even if our industries sell their products in dollars the buyers will use local price and convert its equivalent in dollars.  There will also be out competed by other countries producing similar products because of their relative cost advantage. The other negative implication of a rise in the cost of production due to depreciating Naira/dollar exchange rate is that consumers will find the new prices charged by industries prohibitive & they will respond by either reducing the size of their demand or outright refusal to purchase the goods or by switching to a cheaper substitute or inferior goods and the industries will be left with huge inventories. The immediate reaction of the industries is either to lay off workers (Casual and permanent), reduce daily output, put workers on half pay or even send them on compulsory leave and the effect will spill over to all other sectors of the economy.

A related problem that is macro in nature and also requires macro solution from the center is the problem of smuggling of substitutes goods that are locally manufactured.  Even in cases where the import of these substitutes goods are subjected to high tariff or import duty the unpatriotic section of the men of customers and excise at our Borders do not make the policy to yield the desired effect and as result our local industrial products are out-competed.

(II)        POOR CONDITION OF INFRASTRUCTURAL FACILITIES.

(A) It is a common knowledge that-part of the industrial incentives  that are put in place by all nations aspiring to industrialize are the provision of power, energy or electricity, water, telecommunications and road network or transportation infrastructure in general such as water ways, railways and Air transport.   Adequacy and availability of these facilities is I think what made Kano what it was in the past industrially, and the poor condition of some of these facilities as at today has also played a key role in the collapse of industries in Kano. However, it is encouraging to note that the present administration under Governor Rabiu Musa Kwankwaso has pursued vigorously the rehabilitation of the entire dilapidated road network in the state. I think this is highly commendable and will go in a long way to boost the confidence and morale of industrialists in the State as well as attract fresh investments particularly if the road rehabilitation programme is extended to the industrial enclaves.

(b) The condition of power supply from NEPA has also caused serious industrial decline in the State. The standby generators purchased by the firms have not proved to be alternative or a solution as the diesel they use is either very expensive or unavailable which means an increase in production cost and idleness of machinery and workers, decline in daily output, closures half pay and unemployment, which also translate into low demand for industrial products. On this note the current efforts and plans by Kano State Government to establish a hydro generating plant using- Tiga water resources and infrastructure is highly commendable as it will go in a long way in stabilizing  power supply not only to industries but residential consumers. I heard that Lagos and Rivers States have also embarked on similar plans.

(c) The Condition of Water supply has also been discouraging and has been   having a devastating effect on such industries like tanneries, textiles and bottling companies. The problem is much more acute at Bompai industrial estate as compared to Challawa and Sharada. The problem is more compounded when there is power disruption from NEPA as a result of load shedding or repairs. The State Water Works Generating Plants lack also the capacity to simultaneously supply both the residential and industrial consumers. The Borehole alternative has not proved to be an effective solution as some posses hard water which has to be softened for some chemical treatment and processes particularly in textiles and tanneries. Moreso, the Boreholes do not give sufficient water as their average yield is 2 litres per second or 7200 litres per hour and the firms require on the average 2-3 times higher. Equally, from the Engineering point of view sinking more than one Borehole in an industrial plot measuring 150 by 150 meters is not advisable.

(d) The lack of telecommunication services particularly in Chalawa and   part of Sharada and Tokarawa / Jogana areas has also been cited as one of the factors responsible for the collapse of industries in Kano. The role of telecommunication in speeding up the process of ordering and delivery of goods both finished and un-finished products or raw materials can not be overemphasized. When breakdown of plants also occur, telecommunication services are needed to speed up repairs so that production cannot be discontinued. Several studies have attempted to shed light on the issue of Government investment in infrastructure and private investment or manufacturing activities. Lee & Anas (1992) study of the Nigerian Manufacturing firm, reported that in the face of chronically unreliable public services, many manufacturing forms had acquired radio equipment for communications and Borehole to ensure their own private water supply. The study also found that this extra cost amounted to same 10% of the total machinery and equipment budget of the sampled firms. This study concluded that for smaller firms these extra costs could be as high as 25% of their total cost. This same study discovered that out of the 306 companies that were surveyed 44% had private generators and boreholes.

in another study by Lee and Usman (19S3) this time around in Thailand, it was found that of the 300 firms that were surveyed only 6% (18) had private generators and 24% (72) had private power supply. This should provide an interesting comparison with 44% figure for Nigeria.

(III)  FISCAL /TAX DISINCENTIVES.

Tax policy has been in use for a very long period as powerful instrument to         promote industrial activities in both developed and developing countries. However, the present situation in which industries in Kano are subjected to multiple tax payment has also cited as a strong cause of industrial collapse because of it's disincentive effect. According to M.S Umoru (2000) there are approximately 22 different taxes and levies payable by industries in the State which are collected by all the 3 tiers of Government.

(IV)   RELIGIOUS/TRIBAL/POLITICAL UPHEAVALS.

Disruption of peace as a result of rioting or demonstration on the basis of religious, tribal or political reasons had also negatively affected industrial activities in the State. Among other things it leads to capital flight or relocation of firms to a more peaceful environment. It can disrupt suppliers of basic inputs and raw materials to industries causing stoppage of production and idling of workers and eventually losses which may never be recovered. It can also discourage fresh investments or expansion of existing ones.    Qualified manpower indigenous and expatriates are also lost as a result of insecurity to lives and property. Incidences such as the 1980 Maitastine turmoil, July 1981 riot to defend the Emirs palace, October 1982 riot motivated by Reinhard Bonke's visit to Kano, May 1995 riot caused by a quarrel between Fulani and Igbo man and of recent the 1999 Spill over carnage in Kano as a result of Shagamu incidence are definitely a food for potential investors in the State. On a general note other factors may include: the risk aversion of the financial sector not to give long term loans that are required by industry because production in manufacturing is characterized by long gestation period. Failure of the agricultural sector and the small scale industry sub-sector to thrive and provide the bigger industries with the needed backward integration, lack of Management Capacity on the part of local indigenous industrialist to lead the pace in Manufacturing exemplified by the collapse of Bagauda Textiles, Bebeji oil mill, Globus enterprises and soon and so forth. On the contrary while these enterprises are collapsing others with the same line of production are Expanding /booming.   These industries include Multitan at Challawa, African Textile, Standard Plastic at Jogana, Fahid Dyke ventures, Mario Jose Enterprises and some few others. Sunusi (2000) summarized this by estimating that by the year 2000, numerous companies in kano had become dorm out and many others closed. 

MINING

Minerals have played a major role in human development from the pre-historic era. Man has explored the abundant mineral resource in the world to achieve most of this technological advancement in every sector. Olurunfemi (2001) holds that there are about 2000 minerals in the earth, while only about 100 are of economic importance. These economic minerals are distributed irregularly all over the world and as such, no country/region can boost or possessing all her minerals requirements. Most developed countries or regions today arrived their original developments to the preserve of mineral resources is their immediate areas.

Kano state is blessed with metallic, non metallic minerals and gemstone in commercial quantities. It has mineral resources such as tin, kaolin, silicate, feldspar and quartzite, clay mica, columbite, copper, iron ore, diamond, Limestone and sapphire. Yet, mining activities are almost non – existent in the state. The over reliance on petroleum by the federal government, which owns all mineral resources in Nigeria retards mining activities.

BANKING AND INSURANCE

The rate of banks and insurance company in the smooth functioning of economics activities of a particular area, can not be under stated. These two economic industries act as the grease that oil the wheels of economic activities. As the leading commercial centre in the north, Kano state has a number of banks and other financial institutions which provide capital and diverse services for business men and general public. There were 31 commercial and merchant Banks and 44 Insurance companies in the state, as at 1987. This numbers has more than doubled today.

TOURISM AND RECREATION

Kano State has a number of tourist attraction and recreational center, which attracts Nigerians and foreigners and serve as a means of earning revenue.

The centers include the following:

1. Audu Bako Zoological garden.

2. Falgore game reserve

3. Gidan makama museum 

4. Kurmi market

5. The Emir’s palace and its festivities

6. The city walls and gates

7. Kofar mata dyeing pits

8. Dala hill

9. Tiga Dam and Bagauda lake hotels and resorts

10. Kusalla dam and fishing centre

11. Rurum picnic site.

Kano state has an international airport and many decent hotel which support or form part of the tourist and recreation centres of the Kano Economy.

The prominent hotels that support these tourists’ activities include Prince hotel, Tahir guest Palace, Ni’ima Guest Palace, Royal Tropicana hotel, Central hotel and Daula hotel. Unfortunately, most of all these prominent hotels are located in the Kano metropolis leaving the rural environment backward, thereby encouraging migration.

OTHER SERVICES

There are a myriad of other services which support the economy by providing income and employment opportunities to many people living in Kano state.

Health services are provided by public and private hospitals in clinics. Educational services are provided by also public and private schools in the state.

Consultancy services in the field of engineering, medicine, management, information and education are being provided by a number of firms.

There are modern and traditional estate valuers and agents who provide services to people wishing to rent or buy houses and lands in the state. There are thousands of motor vehicles, motorcycle and bicycle mechanics whose services are very essential to the progress of Kano state.

In the traditional sub – sector of the services of the Kano economy, there are many services from which many people earn their means of livelihood, this include barbing, traditional medical practice, and occultism.

Women in their matrimonial homes and in governmental and non-governmental organizations (NGOs) also render many services which help the economy of Kano state. The services provided by women in their matrimonial homes to their families and neighbors, though very difficult to be measure monetary terms, are very much appreciated and valued in the Islamic socio – economic system cherished by almost 99% of the citizens of the Kano state.  

PROBLEMS MILITATING AGAINST THE PROGRESS OF THE KANO ECONOMY

The initial cases of the decline of industrialization in Kano state still persist today. In addition to these cases there are a number of problems that draw back the Kano economy. These problems include.

EDUCATIONAL CRISIS

Kano state is among the educationally backward state in Nigeria. As such a majority of its populace who engage in agriculture and commerce (the two most prominent sectors of the economy) are illiterates. Ngozi (2000), illustrates that the rate for primary school and secondary school enrollments in the country are lower in these state. They therefore lack the basic knowledge and skills required to squarely face the challenges and competitions brought by modernism and globalization and are unable to adequately tap the abundant resource in the state.

LACK OF TRUST AND COOPERATION AMONG ENTREPRENEURS

Rampant cases of mistrust discourage entrepreneurs in Kano state to cooperate with one another in order to run partnership or joint stock businesses. People prefer to run sole proprietorship business for fear of mistrust and conflict of interests in the running of the business. This sets a limit to the expansion of economic activities in the state.

INADEQATE CAPITAL

The problem of mistrust has made it very difficult for an investor to get loan or counter funding from friends, associates and relatives. Loans from banks are not also profitable due to high interest rate, which stands at over 25%. Even in situations where these loans may be turned into profitable venture, the need for collateral security poses a problem. This militates against the Kano economy.  

DIVISION OF LABOUR AND SPECIALIZATION IN  KANO ECONOMY:

Based upon observations, there is clear division of Labor and Specialization in the Kano economy with respect to the ethnic groups and settlers in the state. The Table below depicts this:

TABLE 5.1.ETHNIC SPECIALIZATION IN KANO ECONOMY.

Source: Author’s computation

CONCLUSION

When one considers the numerous resource endowment of Kano state, the conclusion that comes to mind is that the state is blessed and has potential to leapfrog the Kano state economy to economic growth. Hence the future of the state economy is bright provided that it receives due attention from appropriate quarters. If the problems of wrong and inconsistent overall monetary policy, fiscal disincentives, paltry infrastructure religious / tribal / political up - heavals, educational crises and the problem of mistrust, all of which are highlighted above are positively addressed i.e. other activities de-congested from metropolitan Kano to other rural areas of the state the economy could pilot itself to growth.

References:

Kano State Ministry of Commerce, Industry and Cooperation (n.d) Kano state Commercial and Industry Handbook.

Kano state (1997) The People’s Vision of Development: Report of a National Survey Sponsored by U.N.D.P.

Potential Investors Guide to Kano state (n.d) A Kano State Publication

Sani Badayi M. (2001) The collapse of Industries in Kano state of Nigeria: Causes and Solutions  A Paper presented at the Joint Annual General Meeting of the Manufacturers Association of Nigeria held at Kano on 31st may, 2001.

Sanusi, Sa’idu M. (2000) “Decline of the Great” Nigerian Outlook News Magazine May 2002        

Ngozi (2001): “The role of social in structure in Nigeria’s Development”: A paper presented at the CBN First National Monitoring Forum, November Abuja.

Olurunfemi B.N. (2001); “The solid mineral sector and Nigeria’s Economic Development.” A paper presented at the CBN First National Monitoring Forum, November Abuja.  

CBN (2000): Nigeria: Economic, Financial and Banking Information.