After years of operations in Nigeria, American Technology giant International Business Machines (IBM) has decided to exit the Nigerian market. The company has also announced plans to leave Ghana and other African countries. IBM’s departure is part of a larger restructuring initiative that involves transferring its operations to MIBB, a subsidiary of the Midis Group. According to the company, MIBB will oversee the marketing and sales of their products and services in 36 African countries, ensuring continued access to the technology giant’s offerings while promoting Innovation and growth in the region.
Furthermore, the firm emphasised that this transition is designed to enhance customer experiences and empower local partners, marking a major change in how the company manages its operations across the continent. Meanwhile, their contribution to the region’s technology sector cannot be overstated. In the 1960s, the company partnered with the University of Ibadan to establish an educational centre to build digital capacity. Over the years, it has played a pivotal role in shaping the country’s technological system by providing infrastructure, consulting services, and solutions to key industries, including education, banking, telecommunications, oil and gas, and government.
Multinationals leaving Nigeria amid economic challenges.
Their exit marks the end of an era, as it was instrumental in promoting technological innovation and capacity-building in the country. However, IBM has clarified that its decision to transition to a new operating model does not mean an end to its presence in Africa. Instead, the company aims to leverage third-party expertise to ensure its services remain accessible across the region. In recent years, a growing number of multinational corporations have exited Nigeria, citing a combination of economic and operational challenges. Companies such as Microsoft Nigeria, PZ Cussons Nigeria Plc, Kimberly-Clark Nigeria, Diageo Plc, and South African grocery retailer Pick n Pay have all ceased operations in the country.
In some cases, these companies have sold their stakes or transitioned their operations to local entities, reflecting the difficulty of navigating the nation’s complex business environment. Economic instability has been a key factor driving these exits. The country’s weak currency, high inflation, and limited access to foreign exchange have made it increasingly difficult for multinationals to sustain profitability. Unstable government policies, poor infrastructure, high energy costs, and rising Insecurity have compounded these challenges, leaving many companies with little choice but to shut down or divest their operations.
Oil and gas companies and other sectors were also affected.
Meanwhile, the exodus of multinational companies is not confined to the technology sector. The oil and gas industry, a cornerstone of the nation’s economy, has also seen significant divestments. For instance, Shell sold its onshore oilfields in Nigeria for $2.4 billion, while Total Energies and other global players have reduced their involvement in the country. Consumer goods and service-oriented firms have similarly been affected, with companies like Heineken selling its majority stake in Champion Breweries and Jumia discontinuing its food delivery services in the country.
This has led to job losses, reduced foreign capital inflows, and a weakened Manufacturing sector. Additionally, secondary businesses that supply goods and services to these corporations have also struggled, exacerbating the economic downturn. While the exit of multinational companies presents significant challenges, it also creates opportunities for local enterprises to fill the void left behind. With IBM’s transition to a new operating model, local partners may find new avenues for growth and innovation. However, the federal government must address the root causes of the economic woes to create a conducive environment for local and international businesses.
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As IBM hands over its regional operations, the company’s legacy serves as a reminder of the potential for technology to drive economic transformation. While its departure marks the end of an era, it also underscores the need for strategic reforms to ensure a brighter future for the business and technology sectors. As a result, policy reforms to stabilise the naira, improve access to foreign exchange, and reduce energy costs are crucial for reversing this current trend.