Since Buhari resumed his political office in 2015, both local and foreign investors have expressed their lamentations on the Nigerian economy.
A few years ago, history was made in the democratic era of the country as President Muhammadu Buhari unseated an incumbent president.
His emergence as Nigeria’s president, no doubt gladdens the heart of many Nigerians.
Following Buhari’s inauguration, the country at large was awash with optimism that his government would reignite a fading economy, perhaps by replicating the relatively successful Lagos-APC model.
However, Buhari’s purported lack of economic acumen has been a major sticking point, with former president Olusegun Obasanjo saying the president was weak in the understanding of the Nigerian economy.
“I knew President Buhari before he became President and said that he is weak in the knowledge and understanding of the economy but I thought that he could make use of good Nigerians in that area that could help. Although, I know that you cannot give what you don’t have and that economy does not obey a military order.” Obasanjo said.
Since Buhari resumed his political office in 2015, both local and foreign investors have expressed their lamentations on the Nigerian economy. There have been established businesses that had hundreds and thousands of Nigerians employed but have crumbled due to the economic situation under the Buhari administration.
The mid-point of president Buhari’s tenure presents an opportunity to enlists giant businesses that sustained the country’s economy during the previous administration that are no more.
Etisalat
On Monday, July 10, Chief Executive of Etisalat International, Hatem Dowidar confirmed that Etisalat Telecommunication Company has terminated its management agreement with its Nigerian arm and ordered the business time to phase out the brand in the country.
Dowidar said all UAE shareholders of Etisalat Nigeria have exited the company and have left the board and management. After nearly ten years of trying to promote a successful subsidiary in Africa’s largest telecoms market, Etisalat exited following the failure to agree to a debt restructuring deal with leading Nigerian banks, who had lent $1.2 billion to its erstwhile Nigerian unit, Etisalat Nigeria, which is now called 9mobile.
Etisalat’s failure in Nigeria can be credited to the country’s inability to meet its loan obligations. Etisalat Nigeria had in 2013 obtained a seven-year loan facility of $1.2 billion from 13 local banks and their foreign counterparts to refinance a $650 million loan as well as fund the expansion of its network.
For many reasons, the consequences of Etisalat’s exit will reverberate throughout the country’s telecoms and banking sectors in particular, and the economy in general, for a long time.
Erisco Foods
Erisco Foods Limited announced the shutdown of its tomato manufacturing business in Nigeria, citing an unfavourable operating climate which escalated operational costs. The company, according to the President/CEO of Erisco Foods Limited, Chief Eric Umeofia, relocated the manufacturing aspect of the business to China from where finished products would be imported and sold to consumers in Nigeria and other parts of the world.
According to him, the decision to shut down the Nigerian manufacturing plant was taken after the expiration of a 30-day ultimatum given by the management of the company to the Federal Government to compel the Central Bank of Nigeria to make available enough foreign exchange to assist in the imports of raw materials as well as the requisite equipment needed to keep the manufacturing plants running and also profitable.
The company had also demanded that the Federal Government compel regulatory agencies like NAFDAC, SON, and the Federal Ministries of Agriculture, Industry, Trade and Investment to end the imports and dumping of sub-standard tomato paste in the country.
OLX
Sjoerd Nikkelen, CEO of the Argentinian global online marketplace, OLX confirmed the company’s exit with claims that though, it was a difficult decision to quit but was a necessary one.
Nikkelen said, “We made a difficult but important decision in Nigeria to consolidate our operations between some of our offices internationally.”
Following the shut down of the Nigerian operation, hundreds of people are believed to be left out of jobs.
“Of course, we are committed to helping our affected colleagues during this transition and have already offered them meaningful financial and other support. As we’ve expressed to them directly, we are extremely grateful for their many significant contributions to OLX’s success.” Nikkelen added.
Efritin
Just sixteen months after its official launch, the advertisements website wound down operations in Nigeria.
An investigation revealed that high cost of data and operational demands forced the e-classified advert player to close shop.
Nils Hammar, the Chief Executive Officer, Saltside Technologies and owners of Efritin, confirmed the development, blaming it on the harsh economic conditions of the country.
Hammar said the high cost of data is slowing down investments, adding that the current economic indices in the country may last longer than expected.
Intercontinental Hotel
Intercontinental Hotels Group, IHG may follow businesses that have left Nigeria for one reason to the other. The company has already threatened to leave the country.
IHG is alleging breach of contract by Messrs Kunle Ogunba, the Skye Bank appointed receiver/manager of Intercontinental Hotel Lagos.
The IHG, which went into an international management agreement with Milan Industries Ltd, owners of Intercontinental Hotel, Lagos, in January 2012, had in a notice of termination of the agreement, expressed its displeasure with Messrs Kunle Ogunba who was appointed receiver/manager by Skye Bank following an interim court order.
However, the Nigeria Customs Service, NCS, had earlier threatened to shut down the popular Intercontinental Hotels in Lagos back in 2015. The Customs claimed the decision to shut down the hotel was because the hotel’s parent company, Milan Nigeria Limited is a major debtor yet to pay the federal government its share of an estimated N23. 6 billion rice import duty.
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