New Telegraph

P&G’s Exit: MAN, LCCI Predict Doomsday for Nigeria

As the number of investors exiting Nigeria continues to grow with Procter & Gamble (P&G) queuing behind others that have left, members of the Organised Private Sector (OPS) have warned the Federal Government that Nigeria does not have the shock absorbers to watch multinationals stream out of the country. They said this would spell doom for the country’s Gross Domestic Product (GDP), both in the short and long- term, unless the Federal Government urgently intervenes in challenges confronting the manufacturing sector. Procter & Gamble cited harsh macro-economic conditions for its decision.

Speaking with New Telegraph in Lagos the Director- General, Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, and Director-General, Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona, unanimously stated that the trend of exit of multinationals was worrisome and not sustainable. They charged the government to urgently find ways to implement measures to stabilise and ensure the availability of foreign exchange (forex) for businesses, particularly those operating in dollar-denominated environments. Ajayi-Kadir said that the hierarchy of MAN was saddened to hear the news of another exit of a multinationals, Procter and Gamble; a firm that has invested billions of dollars in Nigeria’s economy, citing that the company had a portfolio valued at $85 billion.

The MAN DG explained that MAN could not fold its hands to see continued exit of multinationals in the country’s manufacturing sector, without proactive steps being taken by government in an already challenged business environment. According to him, the lingering foreign exchange (forex) scarcity, poor power supply, port congestion, multiple taxation, insecurity, and poor infrastructure, among others, have taken a toll on many businesses in the country.

In the same vein, Dr. Almona explained that the various reasons raised by the Chief Financial Officer of Procter & Gamble, Andre Schulten, in his statement, including challenges in conducting business as a dollar- denominated organisation and others to the macroeconomic conditions in Nigeria, had clearly shown that firms were still struggling to find their bearings in the country, especially in the manufacturing sector.

The LCCI DG noted that in the last few months, there has been a consistent increase in exit plans or a reduction in involvement in the Nigerian market by multinationals, saying this trend is worrisome. According to her, the country has seen the likes of Unilever Nigeria, Glaxosmithkline, and Guinness Nigeria Plc taking exit steps out of Nigeria.

Amidst the prevailing economic challenges, the economic expert said that the Chamber was recommending that the government should implement measures to stabilise and ensure the availability of foreign exchange for businesses, particularly those operating in dollar-denominated environments, create a more flexible and transparent foreign exchange policy to address scarcity issues, engage multinational corporations and the business community to understand their challenges and gather input and feedback on policy decisions to jointly develop solutions that will forestall the exodus of businesses from Nigeria and prioritise the stability of the country’s currency and adopt the right policy mix to ensure price stability.

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