A major consequence of the privatization exercise in Nigeria is

Step 1: Analyze the question The question asks for a major consequence of privatization in Nigeria. Privatization is the transfer of government-owned enterprises (e.g., NITEL, Nigeria Airways, power distribution companies) to private owners. The policy was pursued under the Privatization and Commercialization programme, later managed by the Bureau of Public Enterprises (BPE).

Step 2: Explain the concept When the government sells or hands over state-owned companies, the new private owners aim for efficiency and profit. Public enterprises were often overstaffed, so new owners typically cut staff to reduce costs. This is the most widely documented negative social effect of privatization in Nigeria.

Step 3: Evaluate each option

• A. Collapse of the Nigerian economy. Too extreme. Privatization did not collapse the economy.
• B. Reduction in foreign exchange. Not a direct or major consequence. If anything, privatization was meant to attract foreign investment.
• C. High rate of indebtedness. Privatization was meant to reduce government subsidies and the financial burden of loss-making enterprises, not raise indebtedness.
• D. Mass retrenchment of labour. Correct. Following the takeover of firms such as NITEL/MTEL, Nigeria Airways, and various textile and cement companies, thousands of workers were laid off as new owners restructured and downsized. This is the classic criticism of privatization from labour unions such as the NLC.

Step 4: Answer The correct option is **D.

Exam tip: For "consequence of privatization" questions, remember the link: private owners → profit motive → cost-cutting → job losses. Options that are extreme ("collapse of the economy") are usually wrong in JAMB Government questions.