The Chartered Institute of Directors has advised the federal government to do more to attract foreign investments and retain multinational companies.
The Director-General of CIoD, Bamidele Alimi, gave the advice in the institute’s position paper on the exodus of multinationals from Nigeria.
The paper was made available to journalists in Lagos on Tuesday.
Mr Alimi said that the federal government should adequately address the issues making multinational companies exit Nigeria.
He said that Nigeria has recorded a significant exodus of multinationals over the past decade.
According to him, the exodus raises concerns about Nigeria’s business climate.
Procter & Gamble, GlaxoSmithKline and Kimberly-Clark are among the multinational companies that have left Nigeria.
The CIoD director-general said, “Obtaining foreign exchange is a significant hurdle for multinationals and the volatility in the exchange rate creates untold hardship for businesses.
“Lack of an easily accessible liquid forex market, where companies can easily buy and sell foreign currency at market rates, significantly hinders their operations. The depreciation of the naira against major currencies such as the US dollar further compounds foreign exchange problems.”
Mr Alimi said that unreliable power supply also posed a challenge, as frequent outages disrupted production, increased reliance on expensive generators, and raised operational costs.
He urged the government to adequately address infrastructural impediments, bureaucratic bottlenecks and security challenges.
Mr Alimi said that a stable and predictable business environment with access to foreign exchange, reliable power supply, efficient infrastructure and improved security would retain multinationals and attract new ones.
According to him, this will lead to increased investment, job creation and economic growth.
He stressed the need to reduce dependency on oil by diversifying the economy through improved investments in agriculture, manufacturing, technology and services.
He said that initiatives that would support small and medium-sized enterprises and innovation would drive diversification.
Mr Alimi advised that the Central Bank of Nigeria should adopt more flexible foreign exchange policies that would give businesses easy access to foreign currencies.
Mr Alimi said that the government should collaborate with the private sector to create a more business-friendly regulatory framework, simplifying processes and reducing bureaucratic bottlenecks.
“The Presidential Fiscal Policy Reform and Tax Committee should consider incentives to reduce the cost of doing business. This could include tax breaks, subsidies for critical inputs, and support for technology adoption to improve efficiency.’’
Mr Alimi said that business registration processes should be simplified.
He added that there should be improved access to credit, protection of minority investors and effective enforcement of contracts.
The CIoD director-general emphasised the promotion of partnerships between multinationals and local businesses to enhance local capacity and ensure more sustainable investments.
He said, “Lastly, the government should actively engage in public relations campaigns to rebuild confidence among foreign investors.”
NAN