The Nigeria Employers’ Consultative Association has expressed deep concern regarding the escalating trend of business divestment, capital flight, and business closures within the country.
In an official statement, NECA emphasized that in numerous developing economies worldwide, private enterprises contribute to more than 93 percent of total employment, encompassing both formal and informal job sectors.
The private sector remains a pivotal force for fostering economic growth, playing a vital role in national income generation and ensuring the efficient flow of capital, NECA highlighted.
Adewale-Smatt Oyerinde, the Director-General of NECA, lamented the regrettable recent surge in business relocations and divestments.
He remarked, “Throughout the past decade, the private sector has borne the brunt of unfavorable government policies.
Many of these policies lacked pro-growth orientation, were poorly timed, or failed to align with the economic realities of the country.”
“In more intricate cases, we witnessed clashes and inconsistencies among policies, along with excessive regulatory and legislative constraints on businesses, resulting in a lack of clear direction for planning and decision-making.
Operating costs have skyrocketed, exacerbating the challenges faced by numerous companies.”
The director-general underscored that the repercussions of these years of misguided policy decisions were predictable.
He pointed out, “It is no surprise that divestment, capital flight, and outright closures have become the ‘new normal’ in the business community.”
According to him, this phenomenon significantly contributes to the perpetual surge in unemployment rates, leading to a corresponding increase in crime and other security concerns.
When businesses halt operations, divest, or relocate to more favorable environments, a substantial number of Nigerians are left jobless, leading to a decline in tax revenue and hindrance to social investments, consequently deepening poverty.
Oyerinde emphasized, “It is crucial for the government to urgently address this predicament. While we recognize and commend the current administration’s efforts in addressing private sector concerns and providing relief to specific sectors of the economy, more comprehensive measures are needed.”
