Amid a growing trend of multinational companies scaling back their operations in Nigeria, the country's economy is poised to suffer a substantial blow, losing an estimated $335 million (approximately N310 billion) in Foreign Direct Investments (FDI). This financial setback is a consequence of Procter & Gamble (P&G), a prominent global player in the Fast Moving Consumer Goods (FMCG) sector, and Equinor, a major player in the upstream oil industry, announcing their exits.
Procter & Gamble (P&G), an American multinational consumer goods company, has disclosed its intention to shift from local production to exclusive product imports, signaling a gradual withdrawal from on-the-ground operations in Nigeria. Concurrently, Equinor is making its exit after divesting its Nigerian business, including its stake in the Agbami oil field, to the Nigerian-owned energy company Chappal Energies.
Addressing the rationale behind this strategic shift, Andre Schulten, Chief Financial Officer of P&G, cited the challenging business environment in Nigeria and the difficulties in creating US dollar value as key factors influencing the decision. Similarly, Nina Koch, Equinor's Senior Vice President for Africa Operations, stated in a press release, "Nigeria has been an important part of Equinor’s international portfolio over the past 30 years. This transaction realizes value and is in line with Equinor’s strategy to optimize its international oil and gas portfolio and focus on core areas."
This development follows the departure of two other major multinational companies, GlaxoSmithKline (GSK) Consumer Nigeria Plc and Sanofi-Aventis Nigeria Limited, a French pharmaceutical company, in the second half of this year. The combined assets divested by these companies amounted to over $800 million, with the harsh operating environment in Nigeria cited as a primary reason for their exits.
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