Segun Ajayi-Kadir, Director General of the Manufacturers Association of Nigeria (MAN), has expressed concern at the departure of global consumer goods maker Procter & Gamble from Nigeria, warning that additional manufacturers may follow suit.
He believes that further departures would occur in the industrial sector until the Federal Government adopts articulated actions to address the issues that manufacturers face in the nation.
“Obviously, we received it (P&G exit) with sadness but it is not totally unexpected and more may happen because there is no doubt that we operate in an environment that is challenged,” Ajayi-Kadir stated.
“Manufacturing in any economy is a strategic choice, the government has to make up its mind whether it wants its country to be an industrialised one. Once that decision is taken, you have to do all that is needed to remove the binding constraints that limit the performance of that sector, Nigeria has not done so and that is why you can see there are closures.
“I think it is news because it is Procter and Gamble, it is news because it is GlaxoSmithKline, it is news because they have been in the country for a very long time, but there are several others that have died quietly and for reasons that are clearly avoidable.”
However, the MAN director general stated that the departure of multinational corporations from the country should serve as a lesson to the government, adding that it presents a chance to encourage local manufacturers over international investors since they are more durable.
“I think there is a strong lesson to be learnt there which is the fact that the big ones that are exiting are those multinationals and I think this will send a clear signal to the government that regrettable as it is, it should guide future actions, we need to be strategic in what we promote.
“So, what this means is that if you have a challenged local manufacturer, he is not likely to go anywhere. That is why we are saying that foreign direct investment is excellent, it has led to phenomenal improvement in the performance of the manufacturing sector for so many economies but it should come secondary to empowering the local investor, the existing manufacturers because that is what is enduring.
“So, it is regrettable, it is not totally unexpected, and I think except we take clear redefined measures, many more will happen,” he said.
P&G recently announced its plan to close production lines in Nigeria and begin exporting its goods into the nation, following in the footsteps of another firm, GlaxoSmithKline.
