Companies are leaving Nigeria because of regulations, legislative activities, policy inconsistencies – NECA

Reacting to the recent planned exit of Procter & Gamble, P&G, not long after the GSK, Nampak exited Nigeria, the Nigeria Employers’ Consultative Association, (NECA), has expressed disappointment over the development.

The employers’ body blamed stringent regulatory and legislative activities, insufficient infrastructure, and policy inconsistencies for the difficulties faced by businesses.

Speaking, NECA’s Director-General, Adewale-Smatt Oyerinde, said “NECA commends the Federal Government for supporting the Small and Medium Enterprises (SMEs), and manufacturers through the disbursement of the N125 billion Presidential Palliative Programme.

“This strategic intervention is a proactive step in mitigating the impact of the multi-dimensional challenges currently being faced by businesses. It strongly emphasized the immediate need for decisive measures to halt the ongoing trend of companies divesting from the country.

“While we commend the Federal Government for the disbursement of the intervention funds, we urge a quick and definitive action to arrest the continuous exit and divestment of legitimate organizations in Nigeria.

“In the last few years, hitherto strong brands like GSK, Nampak and now P&G and some other local brands have either closed shop or divested fully or partially. These regrettable departures will persistently undermine the Federal Government’s efforts to attract Foreign Direct Investment, rendering its initiatives highly ineffective.”

Highlighting the probable factors behind these business closures, the NECA boss asserted “that the challenging business landscape, marked by stringent regulatory and legislative activities, insufficient infrastructure, and policy inconsistencies, all conspired to exacerbate the difficulties faced by businesses.

“When established global brands like P&G cannot survive the environmental and regulatory onslaught, it is worrisome how many more businesses will capitulate.

“Regulatory bodies tasked with fostering business growth persist in prioritizing revenue generation at the expense of their core mandate, while legislators, in the guise of oversight functions, consistently create impediments for organized businesses, hindering their operations.

The contradictions and self-disruptive tendencies of many federal and state Institutions can only be imagined, as they negate the efforts of the President to attract Foreign Direct Investment.”

NECA implored President Bola Tinubu, as well as the Minister for Finance and the Coordinating Minister of the Economy, “to prioritize the survival of local businesses as the primary step before actively seeking Foreign Direct Investment.

“We advocate for the 2024 Appropriation Bill to address crucial infrastructural requirements conducive to business expansion, laying the groundwork for a prosperous nation.

“Additionally, he underscored the necessity of focusing on comprehensive tax reforms and addressing the challenges related to FOREX and exchange rates with a sense of urgency.”