Networks and Linkages in African Manufacturing Cluster: A Nigerian Case Study

Employing survey data, this paper investigates the basis for long-term sustainable development of industrial clusters in Lagos, Nigeria. We compare these metropolitan clusters with the Nnewi cluster, located within a rural setting in a homogeneous ethnic community. The characteristics of clustering examined are: the forms and intensity of inter-firm linkages, including the formation of trade networks, and the role of business associations. We found a significant level of collaboration among firms in sharing utilities and modest forms of subcontracting non-core activities among Lagos firms, but this is less so at Nnewi. The Lagos clusters have relatively high proportions of educated manpower but this important asset is underemployed in a situation of low grow rate of demand for quality products. The firms at Nnewi on the other hand are owned by seem-illiterates who came from trading backgrounds into manufacturing. Networks such as Industry associations are playing vital roles as information providers and as links into the global market although the benefits are yet to fully manifest. Ethnic and kinship ties play a prominent role at Nnewi while social networks and non-family ties are more important in the Lagos clusters. This study suggests that non-economic factors exert profound influence on the evolving forms industrial organisations in late industrialisation