LAGOS – The inclination rate at which multinational companies are ending their manufacturing operations in Nigeria has become alarming to every concerned economic stakeholder and indeed every Nigerian.
And, if timely strategic interventions are not brought to the fore, as a proactive step in mitigating the impact of the multi-dimensional challenges currently being faced by the businesses, there is no doubt that more of these companies will find their way out.
Between January 2023 and December, no fewer than seven multinationals have either left or announced their decision to exit the country.
Notably, some of these organisations are- Unilever, GlaxoSmithKline (GSK), Sanofi-Aventi Nigeria, Bolt Food, Jumia Food, Equinor and the latest being Procter & Gamble (P&G).
Echoing the concerns for the pullout of these strategic companies, the Director General, Lagos Chamber Of Commerce & Industry, Dr Chinyere Almona, urged the Federal Government to engage multinational corporations and the business community and do the needful so as to forestall the exodus of businesses from Nigeria
“Over the last few months, there has been a consistent increase in exit plans or a reduction in involvement in the Nigerian market by the multinationals, and this trend is worrisome. We have seen the likes of Unilever Nigeria, GlaxoSmithKline, and Guinness Nigeria Plc,” Almona noted.
Over the years, there have been calls for ease of doing business in Nigeria by stakeholders in various business circles and even by some government officials, but it has become evident that the government has been paying lip service to all policies it issues from time to time without corresponding actions.
Some of the issues calling for attention over the years and which government has not given enough attention to, include lingering foreign exchange scarcity, poor power supply, port congestion, multiple taxation, insecurity, poor infrastructure, among others
Commenting further, LCCI helmsman asked the government to engage multinational corporations and the business community to understand their challenges and gather input and feedback on policy decisions to collaboratively develop solutions that will forestall the exodus of businesses from Nigeria.
He also implores the government to adopt the right policy mix to ensure price stability and create a more flexible and transparent foreign exchange policy to address scarcity issues.
Without mixing words, the Chief Financial Officer of Procter & Gamble, Andre Schulten, last year, announced P&G plans to transition its Nigerian operations to an import-only model, effectively dissolving its on-ground presence in the country. The company cited challenges in conducting business as a dollar-denominated organization and attributed its strategic decision to the macroeconomic conditions in Nigeria. The company has a portfolio valued at $85 billion with Nigeria contributing $50 million in net sales.
It is common knowledge that most of the challenges which the government itself is in the know of, have taken a huge toll on many businesses in the country. And to stem the tide of mass exodus of companies, the government and perhaps relevant stakeholders must wake up to the reality and do the needful.
In the wake of GlaxoSmithKline’s announcement to leave the country, the Organised Private Sector has expressed worry that development could trigger a mass exodus of multinational manufacturers from the country.
In separate statements, LCCI and the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) also urged the Federal Government to speedily address the unfriendly business environment to prevent more businesses fold up.
“With justification, the chamber is concerned that if the trend persists, the nation’s economic growth potential will not be realised. It is time the government took appropriate action to reverse the saddening trends in the business clime in Africa’s largest market.”
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