June 17, (THEWILL) – On 12 June – a day set aside to commemorate the 25th year of Nigeria’s unbroken democratic experience last week Wednesday – President Bola Ahmed Tinubu tumbled and fell. That’s the consequence of choking off the President from visible dystonia or Huntington’s disease, a genetic disorder that causes involuntary muscle contractions and brain tremors.
That’s a story for another day.
The rapidly collapsing Nigerian economic climate is the major thrust of this series for which I’m staying focused. Guinness Nigeria Plc is leaving the country after 74 years due to the country’s harsh economic climate and unbearable inflation. The company recorded a loss of N61.9 billion after-tax between July 2023 and March 2024.
Diageo, Guinness’ parent company, is selling its 58.02% majority stake to the Singaporean conglomerate Tolaram Group. The sale is expected to be completed by fiscal year 2025, subject to regulatory approvals in Nigeria, according to the report. Diageo’s exit follows other multinational companies that have left Nigeria in the last one to two years due to the economic climate.
Guinness Nigeria Plc’s recent announcement to leave Nigeria after 74 years is a stark reminder of the country’s deteriorating economic conditions. The company’s exit is not an isolated incident but rather part of a larger trend of multinational companies fleeing Nigeria due to unfavourable economic policies and harsh operating conditions to which the government is pretending that it didn’t exist.
Multinational companies that have exited Nigeria in the last 8 years are GlaxoSmithKline (2020), Microsoft (2022), Unilever (2020), Mondelez International (2019), and Procter and Gamble (2018). In spite of the unintelligent handling of the economy, and the government’s imperviousness to correction, yours sincerely can’t be excused for critiquing the APC/PBAT administration without pointing the ways out of the woods.
To stem the tide of departing multinational companies, Nigeria must address the following issues, and swiftly too. The government must, as a matter of urgency, foster a business-friendly environment by streamlining regulations and reducing bureaucratic hurdles. The President’s economy team should urgently establish clear and consistent policies that encourage investment and growth. The government of Tinubu should provide incentives for businesses to innovate and expand, as well as encourage public-private partnerships to drive economic development. Most importantly, the government should regularly engage with the private sector to understand their needs and concerns.
The President, alongside states and local governments, should prioritise investments in infrastructure. President Tinubu should develop a comprehensive infrastructure development plan that addresses the country’s needs, namely; modern transportation systems, including roads, railways, and ports. Improve electricity generation and distribution to ensure reliable power supply. Develop industrial parks and special economic zones to attract investments. Upgrade digital infrastructure to support e-commerce and digital innovation.
Tinubu’s Presidency should enhance and revamp the nation’s security architecture. The government should ensure the safety of lives and properties by deploying effective security measures and tackle corruption by strengthening institutions and enforcing the rule of law. Improve intelligence gathering and sharing to prevent crimes should be a major tool in this regard. Enhance border security to prevent illegal activities. Ditto establishment of a special task force to protect businesses from harassment and extortion.
The hostile business climate that didn’t promote friendly taxation has been responsible for businesses and multinational companies relocating from the country. We have no choice but to reform the tax system to make it more business-friendly and competitive. It has to reduce tax rates and eliminate multiple taxation; introduce tax incentives for investments in priority sectors, simplify tax compliance procedures to reduce the burden on businesses, as well as establish a tax ombudsman to address tax-related grievances.
Apart from insecurity and unremitting banditary, the government is burdened with onerous tasks to quickly address the issue of hostile community activities. The government should establish a community engagement programme to address grievances and concerns, by setting up a special task force to protect businesses from harassment and extortion. This should be followed with collaboration with community leaders to promote peaceful coexistence, establish dispute resolution mechanisms to address conflicts and provide incentives for communities that promote a peaceful business environment.
On a final note, President Tinubu’s duty to remake a nation free of poverty with a livable economy hinges on boosting growth and creating jobs in the country. The task is immense because Nigeria’s challenges are multifaceted and legion. As of today, 40.1% of people are poor, according to the 2018/19 national monetary poverty line, and 63% are multidimensionally poor, according to the National MPI 2022, while conflict, climate change, unsustainable debt burdens, fuel prices, astronomical prices of good and services, abominable inflation, electricity crises cast a shadow over the country’s economic outlook.
To achieve our aims, President Tinubu must focus on how he can help Nigerians achieve these critical goals anchored on twelve fundamental pillars earlier enumerated in this series, which will require a strategy based on the key priorities.
*** Written by Erasmus Ikhide via: [email protected].
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