American multinational consumer goods corporation, Procter & Gamble (P&G) has announced that the company is stopping manufacturing activities in Nigeria.
The company lamented that it is becoming increasingly difficult to do business in Nigeria due to issues with Dollar to Naira exchange values and issues with the macro-economic environment.
The Chief Financial Officer of the group, Andre Schulten stated this during his presentation at the Morgan Stanley Global Consumer & Retail Conference.
He noted that the company would now focus on import activities only.
Naija News reports the strategic restructuring decision affects P&G’s activities in Argentina as well.
Mr 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 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”
On questions regarding the effect of the company’s planned restructuring in Nigeria and Argentina on its overall group’s portfolio, the CFO explained that Nigeria is a $50 million net sales business compared to the organization’s overall portfolio worth $85 billion, hence no material impact on the group’s balance sheet from a sales or profitability point of view is anticipated.