The exit of international companies from Nigeria could hurt the small and medium businesses in Nigeria, experts have warned.
According to economic experts, SMEs which provide backward, forward integration services, outsourcing and subcontracting jobs to large international corporations are at risk of potentially losing their jobs thus rendering a lot of Nigerians jobless.
Speaking with Saturday PUNCH, a professor of International Economic Relations, Jonathan Aremu, noted that the things that once attracted foreign firms to the country were no longer in place, hence it would be easy for such companies to leave for other African countries where the business climate was favourable to them.
Aremu, who is also a consultant at ECOWAS on the Common Investment Market, added that contrary to some people’s perception, it would be difficult for local companies to take over after the exit of the large companies.
“When you look at it without looking at the interconnectedness of the small and medium concerning practical integrations, subcontracting and outsourcing of activities between them and the large corporations, one may think that the small and medium enterprises may take over from the companies that are going but it is not as easy as that because the technology to take over is not there.
“So, the immediate thing you see with the going away of these transnational companies from where some of these SMEs are engaged in outsourcing and subcontracting activities is that many of them may have to fold up or go to the countries where these things are,” he said.
On his part, Prof Adeola Adenikinju, a professor of Economics at the University of Ibadan said the government must make an effort to stop the exit of the companies.
Adenikinju, who is also the Director of the Centre for Petroleum, Energy, and Economics at the university, revealed that their exit could ‘potentially’ harm the SMEs operating in the country.
SOURCE: PUNCHNG
