The alarm has been sounded by the Nigeria Employers’ Consultative Association NECA on the increase in business closures, capital flight, and business divestiture in Nigeria.
According to a statement from NECA, private enterprises are responsible for more than 93% of employment worldwide, including both official and informal occupations.
According to the report, the private sector remained the primary driver of economic expansion since it significantly contributes to national GDP and ensures the smooth flow of capital.
The recent tendency of corporate migration and divestitures, according to NECA Director-General Adewale-Smatt Oyerinde, is terrible.
The private sector has been negatively impacted by several government policy initiatives over the past ten years, he claimed.
Many of these measures were either anti-growth, poorly timed, or ill-thought-out, while others did not reflect the economic reality of the nation.
“In more complicated circumstances, we saw a time when policies clashed and were contradicted, firms were strangled by regulations and laws, and many enterprises lacked a clear path for planning and decision-making. Operational expenses have skyrocketed, causing many organizations even greater problems.
The director-general observed that the effects of years of poor policy decisions were not improbable.
He stated that, as to be predicted, “outright closures, capital flight, and divestment had become the ‘new normal’ among the corporate sector.
He said that this was one of the main causes of the ongoing, skyrocketing unemployment rate as well as the ensuing increases in crime and other security-related problems.
A big number of Nigerians lost their jobs as a result of firms closing, selling their assets, or moving to more prosperous and pleasant locations, he claimed.
He continued by saying that poverty reigns, social investment is constrained, and Nigeria loses tax revenue.
Oyerinde continued, “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. It is germane to state that Government must take urgent steps to arrest this predicament.