P&G Exit: More Multinationals Likely To Follow, Warns MAN DG

Following the recent departure of multinational consumer goods giant, Procter & Gamble (P&G), from Nigeria, the Manufacturers Association of Nigeria (MAN) has expressed concern and warned of potential further exits from the sector.

Segun Ajayi-Kadir, Director General of MAN, voiced his disappointment but acknowledged that the exit was not entirely unexpected.

He attributed it to the numerous challenges manufacturers face in the country’s difficult operating environment.

“We received the news with sadness, but it is not totally unexpected,” Ajayi-Kadir said when he appeared on Channels Television’s Sunrise Daily on Monday.

“Manufacturing in any economy is a strategic choice, and the government must decide if it wants the country to be industrialised. If so, it must take all necessary steps to remove the binding constraints that hinder the sector’s performance. Nigeria has not done so, and that is why we see closures.”

Ajayi-Kadir stressed that the exit of P&G is just the latest in a string of manufacturers leaving the country. He noted the need for the government to take immediate action to address issues like poor infrastructure, inconsistent policies, and limited access to finance.

“This is news because it’s Procter and Gamble, it’s news because it’s GlaxoSmithKline, it’s news because they have been in the country for a very long time,” he said. “But several others have quietly closed down, and the reasons are clearly avoidable.”

While expressing regret over the departure of these large companies, Ajayi-Kadir sees it as an opportunity to focus on promoting local manufacturers. He believes that empowering existing manufacturers will result in a more sustainable and enduring industrial sector.

“I think there is a strong lesson to be learned here,” he said. “The big ones that are exiting are the multinationals, and this should send a clear signal to the government. We need to be strategic in what we promote. 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, but it should come secondary to empowering the local investor, the existing manufacturers, because that is what is enduring.”

The MAN DG concluded by reiterating his concern about the future of the manufacturing sector in Nigeria.

He called for clear and decisive action from the government to prevent further exits and ensure the sector’s long-term success.