Despite two recent Executive Orders signed by Vice President Yemi Osinbajo, to improve the Ease of Doing Business in the country, more multinational corporations have continued to move fresh investments to other economies considered safer than Nigeria.
The latest move came from Coca Cola, a leading non alcoholic beverage bottler, which would be investing almost $90 million in Kenya, as part of its Africa expansion drive.
The company said the investment is to span over three years through 2018 and aims to increase its product range in the region.
In a statement on Tuesday in Nairobi, the company said the wider range of soft drinks in the country would begin in 2018, although it failed to give details of the range of products.
Coca-Cola, which is the leader in the Kenyan soda market with brands like Coke and Fanta, said it had invested a total of $17 billion in Africa since 2014, an amount that doubled what was invested in the continent a decade before.
The group, however, faces growing competition in Kenya from other soft drinks producers like SABmiller and PepsiCo.
Regrettably, the promise of Africa’s biggest economy has turned to peril with companies drawn to Nigeria by the prospect of a population bigger than Germany and Turkey’s combined are retreating; and foreign investors are pulling their money out.
“Our clients, Fortune 500 and other multinationals are all quite concerned by the state Nigeria finds itself in,” said Alexa Lion, a senior analyst at Washington-based Frontier Strategy Group, which advises companies looking at developing nations. “Sentiment has worsened. There’s a lot of anxiety.”
Recall that after four years of trying to gain traction, Truworths International Ltd., a South African clothing retailer, gave up in 2016. It closed its last two outlets in Nigeria, in the southeastern cities of Enugu and Warri. Not willing to tolerate Nigeria’s dilapidated infrastructure, complicated red tapism and expensive rent, the company said import and foreign-exchange restrictions caused it to throw in the towel.
“We were happy to lose money for a few years while we developed the business and opened new stores,” Chief Executive Officer Michael Mark, had said in an interview.
“The straw that broke the camel’s back was not being able to get stock into Nigeria. You can’t have a clothes shop with no clothes. With all the other things, it just wasn’t worth it. It was impossible to do business.”