The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) has raised concerns regarding the ongoing departure of companies and businesses from Nigeria. It attributes this trend to poor monetary policies and a lack of transparency in the oil and gas industry, contributing to an unfavourable business environment. Dele Kelvin Oye, Esq, The National President of NACCIMA, underscored the seriousness of the situation, noting that the recent departure of major firms like South African retailer Pick n Pay symbolises larger issues.
According to Oye, Nigeria’s business environment suffers from policies undermining stability and investor confidence. He pointed out that the Central Bank of Nigeria’s (CBN) policies have led to significant losses in foreign exchange, pushing several enterprises to exit the market. Inadequate monetary approaches have caused a concerning decline in the value of the naira, presenting a difficult situation for businesses that depend on foreign currencies for their operations. They raised concerns regarding the unclear practices of the Nigerian National Petroleum Corporation (NNPC).
Subsidy removal negatively impacts Nigeria’s business environment.
Furthermore, the organisation argued that the absence of a transparent structure within the oil and gas industry, worsened by the Inflation in gas and petrol prices following the removal of subsidies, has further complicated domestic enterprises’ challenges. NACCIMA stated that although the intention behind ending Subsidies was to stabilise the economy, the resulting increase in energy prices has strained the financial health of companies in multiple industries. Oye called on the CBN to implement clear and consistent policies to address the current decline of the naira, which he believes is essential to reversing the mass outflow of enterprise.
He contended that a stable environment would promote investments and discourage firms from converting their capital into foreign currencies. To achieve this, NACCIMA suggested that the CBN suspend its attempts to eliminate the Bureau de Change system and instead urged for a partnership to optimise the current currency exchange system. The organisation emphasised that an additional Naira depreciation, particularly beyond the 1000 to 1 USD, would worsen economic instability and undermine investor trust. He emphasised the need for a stable regulatory structure from the NNPC to enhance investor trust in the oil and gas industry.
Issues between NNPC and Dangote Refinery were discussed and addressed.
Additionally, NACCIMA underscored the necessity of clarifying the existing uncertainties between the NNPC and the Dangote Refinery, enabling the refinery to function at its maximum capacity and stabilising domestic fuel prices. The group additionally called on the federal government to declare a clear restart date for the Port Harcourt Refinery, as this move could enhance fuel availability and decrease reliance on imports, potentially lowering energy expenses for both companies and consumers. Alongside efforts to stabilise the naira and reform the oil and gas industry, NACCIMA emphasises the importance of promoting non-oil exports, especially to satisfy the growing demand for domestic goods in global markets such as China.
Oye pointed out that Nigeria’s non-oil exports account for only 5% of global demand; however, enhanced support for this sector could lead to expansion, Revenue generation, and job creation. Besides financial and Trade strategies, NACCIMA emphasises the importance of honest and open communication between the government, companies, and Civil Society in developing customised responses to the country’s economic issues. They advocate for establishing a system that encourages productive partnerships, believing that such collaboration will enable the execution of extensive reforms to enhance the business environment and draw in both domestic and foreign investors.
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Lastly, Oye stressed that lacking this level of dedication, Nigeria risks a potential decline in its corporate foundation, which may affect job availability, economic progress, and the country’s overall development. In concluding statements, Oye emphasised the need for collaboration among various stakeholders to tackle the country’s urgent economic challenges. He cautioned that if the CBN fails to intervene promptly to stop the decline of the naira and the ongoing issues between NNPC and Dangote Refinery are not addressed; the nation risks incurring even larger losses in foreign exchange. He warned that these potential losses could lead to additional business failures, worsening Unemployment and poverty.