WAEC Commerce 2012 Theory — Question 9

Model answer

(a) Nationalisation: This is the act of converting a privately owned firm to government owned corporations. This is done to improve the welfare of the citizens. Meanwhile, indigenisation is the act of making the citizen of an economy to participate actively in the control of the economy so as to save the economy from being controlled by foreign firms. (b) Reasons for indigenisation: - to encourage the citizens in participating in the economy - to avoid control of the economy by foreigners - to reduce unemployment in the country - to avoid transfer of capital abroad - to preserve foreign reserve - to provide essential services to citizens at a cheap price