Global consumer goods giant Procter & Gamble (P&G) has announced plans to dissolve its on-ground operations in Nigeria, dealing a blow to the country’s manufacturing sector and raising concerns about potential job losses.
The decision, which will see the company transition to an import-only model in Nigeria, was attributed by Chief Financial Officer Andre Schulten to the macroeconomic reality and the difficulty of operating as a dollar-denominated organization in the country.
While the company assured that the restructuring would allow it to focus on markets with greater potential, concerns remain about the impact on the Nigerian economy, particularly regarding job losses and the potential increase in drug prices.
While addressing an audience during the Morgan Stanley Global Consumer & Retail Conference, Schulten stated;
“The other reality that arises in some of these markets is that it gets increasingly difficult to operate and create U.S 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 program 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 program 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”.
