Clover, a South African beverage line responsible for the production of
Tropika fruit juice, says it is withdrawing future investments in the
Nigerian market.
Clover becomes the second South African company
in two weeks to toe this line. In its fiscal year-end profit/loss
posting, the company said the financial crisis in Nigeria is to blame
for its withdrawal from the Nigerian market.
“The weakened global
economy and the impact of low economic growth forecasts and commodity
prices have had a significant impact on the risks facing Clover in the
rest of Africa,” the financial statement read.
“The current
financial crisis experienced in Nigeria, which is fuelled by low oil
price, is a further cause of concern, thus the Group has decided to
withdraw from future investments in Nigeria.”
The company said it would be looking to the rest of South eastern Africa for future investments.
“The
Group will continue to expand its operations within the Botswana,
Namibia, Lesotho and Swaziland region, and will continue to pursue
export opportunities in Africa where the currency risks can be
mitigated.
“The capital previously earmarked for Africa will no
longer be spent. It is anticipated that planned selling price increases
will absorb anticipated inflationary cost increases in the second half
of the year, as not all selling price increases were realised in the
first half.”
The current foreign exchange policy employed by the
Nigerian government has often been identified to be triggering
withdrawal of investments from the country.
Earlier in the year,
South African retail line, Truworths pulled out of the Nigerian market,
owing to the economic crisis in the nation. International pundits say
the comments of Michael Mark, CEO of Truworths, about the economy show a
sign that President Muhammadu Buhari’s attempts to boost local industry
are hurting foreign investment.
“We were unable to operate the
stores properly any longer because we were unable to send merchandise to
the stores because there’s regulation preventing that,” Mark had said.
https://www.today.ng/business/88199/another-safrican-company-pulls-out-of-nigeria
No comments:
Post a Comment