The Nigeria Employers’ Consultative Association (NECA), representing the interests of employers in the country, has raised concerns over the exit of at least 15 multinationals from Nigeria in the past three years.
Adewale Oyerinde, the Director-General of NECA, highlighted the potential dire consequences of this trend, including increased unemployment, insecurity challenges, and the rise of child labor.
Oyerinde emphasized the alarming impact of the departure of these multinational companies on the country’s economy, labor force, government revenue, and households. He revealed that more than 20,000 employees were affected by the divestments or partial closures of operations by these organizations.
The NECA director cautioned, “The consequences of these massive job losses across sectors will continue to create insecurity challenges, increase the occurrence of child labor (as children will be forced to become breadwinners), adversely affect the disposable income of families, erode the purchasing power of individuals and drastically reduce the economy’s output.”
Prominent companies like GSK, Sanofi, Procter & Gamble, Nampak, and Unilever Nigeria have exited or scaled down their operations in the country in recent years. Unilever Nigeria, for example, announced its exit from the home care and skin cleansing markets in November, citing the need to find a more sustainable and profitable business model.
The NECA director expressed particular concern about the impact on the broader business ecosystem, as these multinational companies were not only major employers but also played crucial roles in supporting numerous enterprises within their value chains.
“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,” Oyerinde stated.
As NECA raises the alarm, the issue of multinational exits becomes a focal point for stakeholders, including the government, businesses, and labor unions, to address the challenges and work towards ensuring the sustainability and growth of the Nigerian economy.
