Connect with us

EVENTS

Economic Crisis: Job Losses As 16 Multinationals Exit Nigeria In 3 Years

Published

on

Spread the love

 

As Nigeria battles an economic crisis sparked by the government’s twin policies of petrol subsidy removal and unification of FX windows, United Kingdom-based Diageo joined about 15 other multinational companies that have exited the country in the past three years.

Diageo is the latest to announce its departure on Tuesday, June 11 when it said it will sell its 58.02% stake in Guinness Nigeria to Tolaram.

Diageo joins others like Kimberly-Clark, manufacturers of Huggies and Kotex brands of diapers; US-based Procter and Gamble (P&G); GlaxoSmithKline (GSK); Unilever and Sanofi-Aventi Nigeria, who are either exiting completely or reducing their exposure in a country facing its worst cost-of-living crisis in decades.

Unilever Nigeria announced its exit from the home care and skin cleansing markets in Nigeria in November 2023, saying it did so “to find a more sustainable and profitable business model.”
Procter & Gamble was the last to announce its exit from the country the same year.
Similar reasons given by these and other companies include high energy costs, currency depreciation, insecurity etc.

The Federal Government itself acknowledged these challenges in an interview granted by Minister of Finance, Wale Edun on Channels Television’s Sunday Politics programme, where he said “lack of a liquid foreign exchange market was the major reason why some multinational companies exited Nigeria,” explaining that the inability of the exiting multinationals to access foreign exchange was a major impediment to their operations in the country.

Weighing-in, the Director-General of Nigeria Employers’ Consultative Association, NECA, Adewale Oyerinde, disclosed that at least 15 multinationals have either divested or partially closed operations in the country in the last three years.

Oyerinde, in his assessment, stated: “Over 15 organisations, with a combined value-chain staff strength of over 20,000 employees, have either divested or partially closed operations,” lamenting that this has “dire consequences not only for organised businesses but also for labour, government revenue and the households; massive job losses across sectors, which would continue to create insecurity challenges”.

Oyerinde added, “When NECA examined the exit of prominent companies like GSK, Sanofi, Procter & Gamble, Nampak, and others, who had been doing business in Nigeria for decades and were huge employers of labour, it was worried about the ripple effect on the broader business ecosystem.

“Within the value chain, numerous enterprises serve as suppliers to these major corporations, and their sustainability is significantly compromised when the primary businesses they cater to face extinction.

“The survival prospects of these secondary businesses are at stake, and their employees are also at risk, as the departure of the main clients could lead to their demise. The crisis within the value chain deserves more attention than it currently receives”.

Related NewsJob losses: 10,733 affected workers get N4.5b part pension paymentJob Losses: 10,733 affected workers get N4.5bn part pension paymentReactions as Warri lady ‘tired of life’ jumps from flyover to death

Other sectoral group leaders and analysts maintain that the continuous exit of multinational firms would dampen Nigeria’s $1trn GDP target of President Bola Tinubu’s administration.

The President had, at the 29th Nigeria Economic Summit in Abuja, told business leaders and Nigerians that Nigeria’s economy can grow to $1 trillion by 2026.

Analysts believe the persistent exit of multinational companies from the country is set to impact negatively on this target.

Data from the National Bureau of Statistics (NBS) revealed that the performance of the GDP in the first quarter of 2024 was driven mainly by the services sector, which recorded a growth of 4.32 per cent and contributed 58.04 per cent to the aggregate GDP, whereas the nominal GDP growth of the manufacturing sector in the first quarter of 2024 was recorded at 8.21 per cent (year-on-year), 9.64 per cent points lower than the figure recorded in the corresponding period of 2023.

Real GDP growth in the manufacturing sector in the first quarter of 2024, on its part, was 1.49 per cent (year-on-year), lower than the same quarter of 2023.

Reacting to this, President of the Manufacturers Association of Nigeria (MAN), Otunba Francis Meshioye said, “MAN expects the government to frontally address insecurity, improve electricity supply, promote fiscal sustainability and ensure policy consistency.

“Among other priorities, the fiscal authority must also lend supportive measures by adequately incentivising the manufacturing sector and other productive sectors.

“This is very important to boost non-oil export earnings in addition to the increase in oil export proceeds occasioned by increased oil production, rising global oil prices and the coming on stream of the Dangote Refinery”.

Director-General of Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona, also speaking on the issue, said: “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 recently now Guinness Nigeria Plc.

“In Nigeria, lingering foreign exchange scarcity, poor power supply, port congestion, multiple taxation, insecurity, and poor infrastructure, among others, have taken a toll on many businesses in the country.”

The chamber recommended that the government should implement measures to stabilise and ensure the availability of foreign exchange for businesses, particularly those operating in dollar-denominated environments, also imploring the government to create a more flexible and transparent foreign exchange policy to address scarcity issues.

“Further, the Chamber urges 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. The CBN should prioritise the stability of the country’s currency and adopt the right policy mix to ensure price stability,” Almona said.

National President of the Association of Small Business Owners of Nigeria, ASBON, Femi Egbesola, maintained that multinationals are among the companies that contribute largely to the country’s GDP and earnings.

“We cannot be talking of growing our economy when the real investors are leaving. Assuming they are leaving and the indigenous ones are increasing, it would have been a different thing. But that is not the case. You make income as a nation when you have investments and investors,” he said.

However, since the coming of the Tinubu administration, Tinubu and Edun, among others, have been speaking on efforts being put in place towards revamping the economy, encouraging Foreign Direct Investment (FDI) and also making local industries vibrant and competitive.

Whether the assurances of Edun, who, on the Channels Television’s Sunday Politics programme, said, “recent executive orders signed by President Bola Tinubu have improved the investment climate … and also disclosed that tax reform proposals aimed at simplifying doing business for local and foreign manufacturers are being considered as part of an Economic Stabilisation Package,” would stem the flow of multinationals exiting the country, only time will tell.

 

EVENTS

Alleged 20Billion Fraud: EFCC Arraigns Ex AMCON MD, Ahmed Kuru, Company in Lagos

Published

on

Spread the love

The Economic and Financial Crimes Commission, EFCC, on Tuesday, February 11, 2025 arraigned a former Managing Director, Asset Management Corporation of Nigeria, AMCON, Ahmed Kuru before Justice R.A. Oshodi of a Special Offences Court sitting in Ikeja, Lagos for an alleged N20 billion fraud.

He was arraigned alongside a company, Sigma Golf Nigeria Limited on an amended six-count charge bordering on conspiracy, stealing and dishonestly taking the property of another.

Details later…

Continue Reading

EVENTS

BREAKING: Terrorism: Justice Nyako adjourns Nnamdi Kanu’s trial indefinitely

Published

on

Spread the love

Justice Binta Nyako of the Federal High Court in Abuja has adjourned the trial of Nnamdi Kanu, leader of the Indigenous People of Biafra, “sine die.”

Kanu’s trial was stalled after Nyako of the Abuja Federal High Court entered a recusal order on September 24, 2024.

The judge issued the recusal order after Kanu asked her to step down from his trial because he lacked confidence in her ability.

Following her decision, Justice Nyako returned Kanu’s case file to the Chief Judge of the Federal High Court, John Tsoho.

However, Tsoho was said to have returned the file to Nyako to continue the trial.

Kanu is currently facing charges of terrorism leveled against him by the Federal Government.

The IPOB leader has been in detention since he was rearrested in Kenya and subjected to extraordinary rendition back to Nigeria in 2021.

Continue Reading

EVENTS

Gospel Singer Paul Nwokocha reveals why he divorced his second wife just one year after marriage despite marrying her one month after first wife left him.

Published

on

Spread the love

Gospel singer Paul Nwokocha has confirmed that his second marriage has hit the rocks.

Paul Nwokocha married a woman named Goodness in September 2023 just one month after his marriage to his first wife, Alice, ended.

At the time he married Goodness, he extolled her virtues with songs on their wedding day and stated that she was from his hometown, so his fans concluded this meant he knew her well.

He also explained at the time that he “decided to marry my new wife, Goodness, one month after my ex wife packed out of our matrimonial home because the Holy Bible said Paul Nwokocha should not be alone.”

Sadly, the second marriage ended after just one year.

Addressing his second failed marriage in a video, Paul Nwokocha claimed his wife Goodness was caught taking nud£ photos of herself and sending to men.

“I married a wife not a wh0r£, so I owe no one apology for this,” he said.

“Stop calling me names. He who wears the shoe knows how it pinches,” he added.

“Not even minding how long I married you, if I find that you are doing evil, you’re going out of my house,” he concluded his statement.

Continue Reading

Trending