Lingering issues such as foreign exchange scarcity,
inadequate power supply, port congestion, multiple taxation, insecurity, and
deficient infrastructure have affected many businesses, especially in the
manufacturing sector.
Apart from the local companies, several foreign operators
announced plans to exit Africa’s biggest economies last year. They are
GlaxoSmithKline Consumer Nigeria, Equinor, Sanofi, Bolt Food and Procter &
Gamble.
“It is not only the multinational companies that are leaving
but the indigenous ones as well who are also finding it difficult to survive
and they need to be supported,” Adeola Adenikinju, a professor of economics and
president of the Nigerian Economic Society, said.
“The government must do everything they can to communicate
with the people and industrialists to know their plans to take the economy from
this difficult position and to find a way to reduce the harsh business
environment,” he added.
Over the past seven months, the country’s inflation rate has
accelerated to the highest in 18 years largely on the back of the Federal
Government reforms such as the removal of petrol subsidy and naira devaluation.
According to the National Bureau of Statistics (NBS),
inflation rose to 28.2 percent in November last year from 27.33 percent in
October.
The latest Purchasing Managers’ Index (PMI) by Stanbic IBTC
Bank also showed that the headline index rose to 52.7 in December, the highest
in six months from 48.0 in November.
More details on the local companies
Mayor Biscuits Company Limited (MABISCO)
MABISCO, an indigenous biscuits company in Ogun State ceased
operations in March.
Established in 2016, the company had over 300 distributors
nationwide, boasting a manufacturing capacity of 3.5 tonnes per hour and
packing machines handling 350 packs per minute.
54Gene
54Gene, a genomics startup shut down in September, ending
its 4-year existence in which it has raised $45 million in three funding
rounds.
The company’s death in September culminated in a tumultuous
year in 2022 where it had three CEOs, a series of complaints from staff and
other legal issues.
Lazarpay
In April, Lazerpay, a web3 and crypto payment company,
closed after two years due to a lack of funds.
The company operated for only two years before calling it
quits.
Jubilee Syringe Manufacturing Company
Jubilee Syringe Manufacturing Company which was inaugurated
in 2017 by former Vice President Yemi Osinbajo, recently ceased operations in
December, citing unforeseen circumstances affecting business operations.
Although production had halted several months ago, the
company carried out in December what it described as temporary redundancy of
staff to ensure the long-term sustainability of the business.
DropX
DropX, a delivery-oriented startup founded in 2021, closed
its operations in December amid challenging economic conditions for startups.
The startup, founded by Praise Alli-Johnson and Oluwatope
Liasu in 2021, began with a plethora of plans to achieve their goals – to
connect businesses and individuals with swift and reliable delivery services.
Okadabooks
Okadabooks, a pioneer in digital publishing and bookselling,
shut down in November after 10 years, attributing it to insurmountable
challenges in the rough macroeconomic conditions.
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