Nigeria (Commonwealth) _Despite being the largest economy in Africa and a population of over 200 million people, Nigeria has recently seen a significant departure of global corporations.
Since January 2023, no fewer than seven multinational corporations have either departed or indicated their intention to leave the country before the end of December. Many of these firms have been conducting business in Nigeria for decades, while others are closing their doors just three years after announcing their entry.
Prior to 2023, some of the obstacles encountered by local and global manufacturers in Nigeria were a power crisis, frequent depreciation of the Naira, forex availability, and other rigorous government policies.
However, many things altered after President Bola Ahmed Tinubu’s inauguration on May 29, 2023, including widespread inflation. In his inauguration speech, the President ordered the withdrawal of gasoline subsidies, which has now affected Nigerians from all socioeconomic strata, and urged the Central Bank of Nigeria (CBN) to commence monetary policy changes.
Following that, Angela Sere-Ejembi, the CBN’s director in charge of financial markets, stated in a press statement that the apex bank announced immediate adjustments to operations in the Nigerian Foreign Exchange (FX) market.
The central bank merged its formerly several exchange rate windows into the business-based Investors and Exporters (I&E) window. However, notwithstanding the CBN’s devaluation and foreign exchange unification, there is still a scarcity of Forex.
This, undoubtedly, impacted international corporations whose operations were heavily reliant on currency availability, as well as Nigerians whose purchasing power had been substantially reduced by soaring inflation.
However, one of the firms featured in this article announced its withdrawal before the end of May.
While the President has repeatedly urged investors to examine the country’s many economic opportunities, the evacuation or divestment of multinational corporations in Nigeria continues to send contradictory messages to prospective investors.
Multinational companies which are fleeing Nigeria:
Unilever
Unilever announced the withdrawal of its home care and skin cleansing products from Nigeria in March. According to the maker of well-known brands like as Omo, Sunlight, and Lux, changes in the company’s business led to the decision to discontinue operations in the nation.
GSK Plc..
GlaxoSmithKline Consumer Nigeria Plc, Nigeria’s second-largest medication maker and British pharmaceutical company, announced the closure of manufacturing activities in Nigeria only four months later, in July 2023.
While no reason was given for the company’s departure from Nigeria, GSK Plc, headquartered in the United Kingdom, stated that its prescription medications and vaccines will be distributed in the country through third-party distributors.
Sanofi-Aventi Nigeria Limited
Sanofi, a French pharmaceutical company, has indicated its intention to leave Nigeria, similar to GSK Plc. In a November release, this firm stated its intention to select a third-party distributor for its commercial portfolio of medications beginning in February 2024.
Food Bolt
Bolt meal, the ride-hailing firm Bolt’s online meal-ordering branch, provides food delivery in 16 countries and 33 locations worldwide. However, two years after launching Bolt meal in Nigeria, the firm announced the painful choice to end meal delivery operations in the nation.
The corporation blamed the decision on the need to “streamline its resources and maximize overall efficiency,” according to a statement. Aside from the company’s justification, Bolt Food’s leave may be related to recent operating losses due to a variety of variables familiar to the Nigerian market.
In 2022, driving services accounted for around 80% of Bolt’s sales income, followed by 10% from rentals, and only 9% from food deliveries.
Food Jumia
Another meal-ordering site, like Bolt meal, has announced the closure of its food delivery operations, leaving other rivals in the Nigerian market. According to TechPoint, Jumia Food will now concentrate on its core physical products business and the Jumia Pay platform in 11 countries.
P&G (Procter & Gamble)
Last Tuesday, the US consumer goods behemoth Procter & Gamble (P&G) announced its decision to discontinue manufacturing in Nigeria.
