American multinational consumer goods company, Procter & Gamble (P&G), has announced plans to terminate its on-ground operations in Nigeria, transforming the country into an import-focused market.
This information was obtained from the company’s 39-minute webcast posted on its website on Wednesday, The Punch reports.
According to Businessday, over 5,000 jobs will be wiped out as a result of the shutdown in Nigeria.
The Punch quotes the Chief Financial Officer, Andre Schulten, as speaking at the Morgan Stanley Global Consumer & Retail Conference in New York, citing challenges operating as a dollar-denominated organisation in Nigeria’s complex macroeconomic environment.
Despite being a $50m net sales business in Nigeria, P&G, with an $85bn overall portfolio, said that it expected minimal impact on the group’s balance sheet in terms of sales or profitability.
Schulten stated, “The other reality that arises in some of these markets is that it gets increasingly difficult to operate and create US dollar value. So when you think about places like Nigeria and Argentina, it is difficult for us to operate because of the macroeconomic environment.
“So with that in mind, we are announcing a restructuring programme with the intent to adjust the operating model and adjust the portfolio to ensure that we maintain the portfolio discipline that has brought us to this point.
“The restructuring programme will largely focus on Nigeria and Argentina. We’ve announced that we will turn Nigeria into an import-only market, effectively dissolving our footprint on the ground in Nigeria and reverting to an import-only model.”
The American multinational joined a growing list of multinationals to leave Nigeria in 2023. In June, the President of the Manufacturers Association of Nigeria, Francis Meshioye, had warned that more international manufacturing companies may leave Nigeria and site their factories in other countries.
