The Nigeria Employers’ Consultative Association (NECA) expressed concerns over the recent trend of relocation and divestment of foreign businesses saying it leads to unemployment and tax losses.
This was disclosed by its Director-General, Mr Adewale-Smatt Oyerinde, in a statement on Wednesday in Lagos.
NECA highlighted that the private sector continued is a catalyst for economic growth, being a major contributor to national income and the efficient flow of capital
Capital flight
Oyerinde noted that the capital flight trend is a major reason why the rate of unemployment continued to rise which relates to crime, he added:
- “When businesses cease operations, divest or move to other profitable and hospitable environments, a large number of Nigerians become unemployed.
- “Inadvertently, the country loses income from taxes, social investment is hindered and poverty holds sway, “.
He added that in most developing economies private businesses account for over 93 per cent of employment, including formal and informal jobs, citing that the private sector continued to remain the catalyst for economic growth, being a major contributor to national income and the efficient flow of capital.
Call for Action
NECA urged for more definitive and urgent intervention to address concerns of the private sector, they said:
- “While we acknowledge and commend the current administration’s effort to address the concerns of the private sector and the steps it took to provide some respite to businesses in specific sectors of the economy, more needs to be done.
- “Beyond the tax reforms activity and the provision of palliatives to select corporate entities, the government should, by deepening engagement with the Organised Private Sector, provide the right intervention.
- “Also, incentive, not only to attract more Foreign Direct Investment but to also prevent more companies from shutting down, divesting or leaving the country,”.
They also urged FG to work collaboratively with the private sector with the view to developing and implementing action plans capable of promoting enterprise sustainability and competitiveness.
- “Sectors such as cosmetics, services, pharmaceuticals, aviation, textile, maritime, construction and, in fact, the real sector should be prioritised as they have the capacity to generate jobs.
- “Expeditious action should be taken to finalise the appointment of Ministers and constitution of Boards of Agencies to drive the economic programmes of the administration.”
In case you missed it
Nairametrics reported last week GSK UK Group informed GlaxoSmithKline Consumer Nigeria PLC of its strategic intent to cease the commercialization of its prescription medicines and vaccines in Nigeria.
The Company made this announcement via an official statement signed by Company Secretary, Frederick Ichekwai which was sent to the Nigeria Exchange Limited (NGX).
According to its unaudited HY 2023 financial statement, the company noted that it would appoint a local third-party distributor in Nigeria for the supply of its consumer healthcare products.
Forex Challenges
GSK noted that they were doing all they can to “limit the period of time the market will be out-of-stock on our products” as it was a priority for patients to get access to their medicines and vaccines.
The company said they were actively engaging with all stakeholders to find a solution to enable a sustainable supply of GSK medicines and vaccines to patients in Nigeria.
