NECA calls for govt intervention to prevent closure of businesses

The Nigerian Employers Consultative Association (NECA) has called on the Federal Government to urgently wade in with some incentives to rescue businesses from collapsing in the country.

NECA made the call in reaction to an announcement by Greif Nigeria Plc, of the closure of its plants in Delta and Kaduna states, adding that if something is not done urgently, many businesses may follow the way of Greif.

Greif Nigeria Plc manufactures and markets steel drums. The company was formerly known as Van Leer Containers (Nigeria) Plc and changed its name to Greif Nigeria Plc in May 2004.

The Director-General of NECA, Mr Timothy Olawale, said in a statement he issued on Tuesday in Lagos that it was quite regrettable that companies were suspending their operations in Nigeria due to many factors, while others which were still operating could no longer compete with their foreign counterparts.

Olawale, who said he was mindful of the efforts of President Muhammadu Buhari at entrenching Ease of Doing Business with a focus on attracting Foreign Direct Investment, insisted that businesses already operating in the country should be given all the necessary support to thrive and mitigate the effects of the inhospitable business environment.

He said: “It is disheartening to receive the news of the closure of the factory plants of the company in Delta and Kaduna states and ultimately the suspension of operations in Nigeria. This brings to fore the challenges businesses are faced with in Nigeria. It is not enough for the government to invite private capital from overseas, businesses already operating in Nigeria should be given all the necessary support to thrive and mitigate the effects of the inhospitable business environment.

“Beyond the many other parameters used to gauge the success of the Ease of Doing Business, one critical parameter is how competitive existing businesses are. We cannot lose sight of the many businesses facing the death knell and several others like Greif Nigeria already losing the battle for survival.”

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Speaking further on the dangers of business closures, Olawale explained that “business closures have greater consequences for the nation as a whole as more Nigerians would join the labour market. Beyond the income of families being truncated, unemployment figures increased and social malaise going out of hand,  government’s ability to generate income through Company and Personal Income Taxes will be reduced.”

As a way out of the current challenges, the NECA boss called on government to double its efforts at creating a conducive operating environment for businesses to thrive.

He said: “There is no reason why interest-free loans, bail-out grants or tax holidays should not be given to businesses that have been certified as being on the brink of extinction.

“A critical look at regulatory high-handedness and lawlessness that tend to stifle businesses is highly overdue if the nation does not want to have many other businesses closing down in few months.”

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