Welcome to class! 

In today’s class, we will be talking about nationalization. Enjoy the class!


This is the taking over (or transfer of ownership) of privately owned business enterprises by the government for economic, social and political reasons.  Such industries involved are known as NATIONALISED INDUSTRIES and the individual owners of the affected industries are paid compensation by the government.

Reasons why the government nationalize industry

  1. To prevent the exploitation of the consumers.
  2. For security, strategic and political considerations.
  3. To provide employment for the citizens.
  4. To generate revenue that will be used for development.
  5. To ensure fair and equitable distribution of social and economic amenities.
  6. To break private monopoly power.
  7. To provide the large capital required to run some business which private owners may not be able to afford.

Advantages of nationalization

  1. It eliminates wasteful competition.
  2. It enables the government to provide essential goods and services to consumers at affordable prices.
  3. It is used by the Government to control or prevent exploitation of consumers.
  4. It provides employment opportunities.
  5. It leads to the elimination of private monopolies.
  6. It enhances Government control of the economy.


  1. State five reasons why the government will nationalize an industry.
  2. State five advantages of Nationalization.

Disadvantages of nationalization

  1. It destroys private initiatives.
  2. It promotes state monopolies.
  3. Nationalized businesses become inefficient.
  4. Corruption and embezzlement is rampant in nationalized industries.
  5. Bureaucracy and political interference in the operations/management of nationalized industries.
Differences between the nationalised industry and public limited company
1 Ownership Owned by the government Owned by shareholders
2 Aim To provide essential services To maximize profit
3 Capital Provided by the government Provided by shareholders
4 Control Controlled by the Board of Directors appointed by the government. Controlled by the Board of Directors elected by shareholders.
5 Formation By decrees or Acts of Parliament Incorporated under CAMA(1990)
6 Publication of Account The account is not usually published Account must be published
General evaluation
  1. What are the main objectives of nationalization?
  2. State five differences between nationalized industry and public limited company.

Reading assignment

Essential Commerce for SSS by O.A. Longe page 240-244.


  1. Define the term nationalization.
  2. State three disadvantages of nationalization.


In our next class, we will be talking about Indigenization.  We hope you enjoyed the class.

Should you have any further question, feel free to ask in the comment section below and trust us to respond as soon as possible.

For more class notes, homework help, exam practice, download our App HERE

Join Telegram Community for exclusive content and support HERE

1 thought on “Nationalization”

Leave a Reply

Your email address will not be published. Required fields are marked *

Don`t copy text!