Nigeria loses about $182,200  (N270.567 million) on each shipment of cargo into the country to maritime crime. This is according to data obtained from the Maritime Anti-Corruption Network (MACN).

The data shows that the impact of corruption in the sector adds about 15 percent to the cost of importing items such as food and bulk products into Nigeria.

The report detailed the results of a study developed by socio-economic impact assessment firm, Quantifying Business Impact on Society (QBIS) which applies a dollar value to direct and indirect costs of maritime corruption across the private sector, government, and society in Nigeria.

The report shows that government officials extract bribes from owners of consignments to carry out routine tasks, or ‘coercive’ corruption.

The study revealed that corruption adds $147,000 per import shipment of grain and more than $187,000 per shipment of petrol. And that Food and petrol account for around a third of Nigeria’s imports.

“With 63 percent of Nigerians or 133 million people classified as multidimensionally poor, most Nigerian families do not have a budget surplus. Increased import costs due to corruption are therefore likely to reduce their household demand and make essential goods less affordable to the average Nigerian family,” the report said.

The business-as-usual scenario adds 1-2 percent to retail prices for grain and petrol.

“Maritime corruption results in an annual reduction in GDP of $204m, an annual reduction in revenue collected by Customs of $42m, and 235,000 fewer Full-Time Equivalent (FTE) jobs due to less sales and economic activity,” the report said.

The report also indicates a zero-tolerance approach to bribery during vessel clearance and that it cuts the damages caused by corruption by around 62 percent.

It showed that by slashing around $114,000 per shipment in corruption costs, the bill for marine corruption falls by around $100m per year, and its economic impact drops by $230m.

“By ‘Saying No’ to maritime corruption, GDP increases by about $130m annually, customs revenue from tariffs increases by $28m annually, and more than 147,000 FTE jobs are created due to more sales and economic activity across the supply chain in Nigeria,” said the report.

 

Daily Trust

The founder of Stanbic-IBTC Bank, Atedo Peterside has announced his retirement as a banker.

Peterside made this announcement in a post via his verified social media page.

The banking icon wrote, “This has been an incredible 35-year journey that ends today, June 10, 2024. 

“Every single day since Feb 2, 1989, I have been either the CEO, Chairman or Bank Director. All good things must come to an end. I give God the glory at age 68,” he added.

His exit comes after over three decades and a half of dedicating his wealth of experience to the Nigerian banking sector.

According to sources, Peterside is investing his time more in advocacy, charity, philanthropy and human capital development through his foundation.

Recall that Peteside founded Investment Bank and Trust Company (IBTC), which later metamorphosed into Stanbic-IBTC Bank after a series of mergers over the years.

The Rivers State-born founded the bank in 1989, at 33, when many of his peers were busy lavishing their parents’ wealth.

After running the affairs of the bank for years leading it to the path of profitability and also ensuring the bank lived up to his expectations, he resigned in 2017.

He later channelled his strength to Anap Jets Ltd he founded in 2015. He also sits on the boards of The Standard Bank of South Africa Limited and Standard Bank Group Limited.

Those close to the former member of the National Economic Management Team and member of the National Council on Privatisation disclosed that when it comes to finance, economics and business success, he is a walking encyclopaedia.

His family background as the son of Pa. Clement Atowari Peterside, an ophthalmologist and a retired controller of Medical Services in the Old Rivers State ensured he had a sound education. 

He graduated from The City University, London with a B.Sc. in Economics and an M.Sc. in Economics from the London School of Economics and Political Science.

 

Vanguard

Israel pounds Gaza, killing dozens, as fighting rages

Israeli forces pounded Rafah in southern Gaza on Friday, as well as other areas across the enclave, killing at least 45 Palestinians as troops engaged in close-quarter combat with Hamas militants, residents and Israel's military said.

Residents said the Israelis appeared to be trying to complete their capture of Rafah, which borders Egypt and has been the focus of an Israeli assault since early May.

Tanks were forcing their way into the western and northern parts of the city, having already captured the east, south and centre.

Firing from planes, tanks and ships off the coast caused more people to flee the city, which a few months ago was sheltering more than a million displaced people, most of whom have now relocated again.

The Gaza health ministry said at least 25 Palestinians had been killed in Mawasi in western Rafah and 50 wounded. Palestinians said a tank shell hit a tent housing displaced families.

"Two tanks climbed a hilltop overseeing Mawasi and they sent balls of fire that hit the tents of the poor people displaced in the area," one resident told Reuters over a chat app.

The Israeli military said that the incident was under review. "An initial inquiry conducted suggests that there is no indication that a strike was carried out by the IDF (Israel Defence Forces) in the Humanitarian Area in Al-Mawasi," it said.

Earlier, the military said its forces were conducting "precise, intelligence-based" actions in the Rafah area, where troops were involved in close-quarter combat and had located tunnels used by militants.

Over the past week, the military said, troops targeted a university that served as a Hamas headquarters from which militants fired on soldiers and found weapons and barrel bombs. It did not name the university.

In the central Gaza area of Nusseirat, the military said soldiers killed dozens of militants over the past week and found a weapons depot containing mortar bombs and military equipment belonging to Hamas.

Some residents said the Israeli onslaught on Rafah had intensified in the previous two days and that the sounds of explosions and gunfire had hardly stopped.

"Last night was one of the worst nights in western Rafah: Drones, planes, tanks, and naval boats bombarded the area. We feel the occupation is trying to complete the control of the city," said Hatem, 45, reached by text message.

"They are taking heavy strikes from the resistance fighters, which may be slowing them down."

STRIKES ON KHAN YOUNIS AND GAZA CITY

More than eight months into the war in Gaza, Israel's advance is now focused on the two last areas its forces had yet to seize: Rafah on Gaza's southern edge and the area surrounding Deir al-Balah in the centre.

"The entire city of Rafah is an area of Israeli military operations," Ahmed Al-Sofi, the mayor of Rafah, said in a statement carried by Hamas media on Friday.

"The city is living through a humanitarian catastrophe and people are dying inside their tents because of Israeli bombardment."

Sofi said no medical facility was functioning in the city, and that remaining residents and displaced families lacked the minimum daily needs of food and water.

Palestinian and U.N. figures show that fewer than 100,000 people may have remained in the far western side of the city, which had been sheltering more than half of Gaza's 2.3 million people before the Israeli assault began in early May.

In nearby Khan Younis, an Israeli air strike on Friday killed three people, including a father and son, medics said.

In parallel, Israeli forces continued a new push back into some Gaza City suburbs in the north of the enclave, where they fought with Hamas-led militants.

On Friday, an Israeli air strike on a Gaza City municipal facility killed five people, including four municipal workers, the territory's Civil Emergency Service said. Rescue teams were searching the rubble for more missing victims.

In the nearby Beach camp, an Israeli air strike on a house killed at least seven people, medics said.

Palestinian health officials said at least 45 Palestinians were killed in Israeli strikes across Gaza on Friday.

The International Committee of the Red Cross (ICRC) said its Gaza office was damaged when heavy-calibre projectiles landed nearby, in an area where hundreds of displaced Palestinians are living in tents.

"This grave security incident is one of several in recent days; previously stray bullets have reached ICRC structures," the organization said in a post on X on Friday. "We decry these incidents that put the lives of humanitarians and civilians at risk."

Israel's ground and air campaign was triggered when Hamas-led militants stormed into southern Israel on Oct. 7, killing around 1,200 people and seizing more than 250 hostages, according to Israeli tallies.

The offensive has left Gaza in ruins, killed more than 37,400 people, according to Palestinian health authorities, and left nearly the entire population homeless and destitute.

The United Nations said on Friday it is Israel's responsibility - as the occupying power in the Gaza Strip - to restore public order and safety in the Palestinian territory so humanitarian aid can be delivered, amid warnings of imminent famine.

 

Reuters

RUSSIAN PERSPECTIVE

US permits Ukrainian strikes anywhere beyond conflict front line – Politico

The US has permitted Ukraine to strike targets on Russian territory using American-made weapons anywhere across the front line – not just in the Kharkov Region, Politico has reported.

This doesn’t represent a change to Washington’s policy on the use of US-supplied weapons by Kiev, anonymous sources told the outlet in an article published on Thursday.

In late May, media reported that the administration of President Joe Biden had quietly greenlighted Ukrainian attacks using American weapons inside Russian territory for “counterfire purposes in the Kharkov region.” The ban on long-range strikes deep inside Russia remained unchanged, according to the reports.

In an interview with ABC News earlier this month, Biden clarified that Ukraine could use US-made arms “only in proximity to the border [with Russia] when [Russian weapons] are being used on the other side of the border to attack specific targets in Ukraine.” Washington is “not authorizing strikes 200 miles into Russia and we’re not authorizing strikes on Moscow, on the Kremlin,” he clarified.

Officials who talked to Politico confirmed the statement made by White House National Security Advisor Jake Sullivan earlier this week, in which he said Kiev’s ability to fire US-supplied weapons wasn’t limited to Kharkov Region.

“It extends to anywhere that Russian forces are coming across the border from the Russian side to the Ukrainian side to try to take additional Ukrainian territory,” Sullivan said in an interview with PBS on Tuesday.

Russian forces are now advancing in Kharkov Region, but if they move across the border in some other area, “it would apply there as well,”Sullivan explained. “This is not about geography. It’s about common sense. If Russia is attacking or about to attack from its territory into Ukraine, it only makes sense to allow Ukraine to hit back against the forces that are hitting it from across the border.”

Russia has repeatedly warned against the use of weapons supplied to Kiev by the US and their allies to strike deep inside its territory, arguing that such attacks would amount to direct Western participation in the conflict, as the Ukrainian military is unable to fire foreign long-range systems without assistance from NATO states.

Russian President Vladimir Putin said on Thursday that Moscow would not rule out supplying weapons to other countries, including North Korea, in response to the West providing long-range systems to Ukraine.

 

WESTERN PERSPECTIVE

Ukrainian drones knock out two substations, Russia-installed officials say

Russian-installed officials said on Friday that Ukrainian drone attacks had put out of action two electricity substations in Enerhodar, the town serving the Russian-occupied Zaporizhzhia nuclear power station and cut power to most of its residents.

But an official at the occupied Zaporizhzhia station, Europe's largest nuclear plant with six reactors, said it was unaffected by the military action.

Russian troops seized the plant in the early days of the February 2022 invasion and Moscow and Kyiv have since routinely accused each other of endangering safety around it. It produces no electricity at the moment.

Eduard Senovoz, the top official in Enerhodar, wrote on Telegram that the latest attack had damaged the second of two substations supplying the town. The other substation was destroyed on Wednesday, he wrote.

Ukrainian officials have made no comment on the incidents and Reuters could not independently confirm the reports.

Russian news agencies quoted Yevgeny Yashin, director of communications at the Zaporizhzhia station, as saying the latest attack had no effect on the nuclear plant. And he said the substation could be repaired.

"Specialists have gone out to the site to assess the damage," Yashin told RIA news agency. "There is a chance to restore the damaged transformer but it will take time."

Russia launched mass attacks on Ukrainian energy infrastructure in the first winter of the conflict and resumed a long series of attacks in March.

Kyiv says the renewed attacks have knocked out half of Ukraine's energy generating capacity and forced blackouts.

Ukraine has stepped up its use of drones this year to attack Russian oil facilities. Ukrainian drones struck four Russian oil refineries as well as radar stations and other military targets in Russia in the early hours of Friday, Kyiv's military said.

 

RT/Reuters

The airplane flight between the Scottish islands of Westray and Papa Westray holds the world record for the shortest commercial flight, as the plane is usually in the air for just under 2 minutes.

Most of us can just hop into a car, bus, or train for short trips, but things are different in the islands of northern Scotland. The few people who call the Orkney Islands their home have only two options, a ferry ride over rough waters, or an incredibly short flight in a small plane. The second option is the most popular – because the ferry can often face disruption due to rough waters – and the most famous because of how short the flights can be.

In fact, the flight between the islands of Westray and Papa Westray is officially recognized as the world’s shortest commercial flight. It usually lasts about 90 seconds, but with favorable winds, it can be over in less than a minute.

The world’s shortest commercial flight was first established in 1967 and has been operated by Loganair ever since. It covers a distance of just 1.7 miles, which is shorter than the runways of most major airports and is more similar to a bus ride than an actual airplane flight. Passengers are flown in a Britten-Norman Islander, a small plane that requires only one pilot and has just eight seats. As you can imagine there is no in-flight service available.

In normal conditions, the world’s shortest commercial flight lasts between 90 and 120 seconds, but as one pilot has demonstrated, in favorable weather conditions, it can be completed in just 53 seconds. However, in unfavorable circumstances, the plane will be in the air for almost 3 minutes.

The flight between Westray and Papa Westray has been criticized as unnecessarily bad for the environment because of the short distance it covers, but for the inhabitants of Westray (600) and Papa Westray (90), it is a vital link to other more populated islands. For Orkney Islands residents, the flights are subsidized by the Scottish Government, while tourists can expect to pay between £17 to £45.

Despite the small populations of the two islands, the world’s shortest flight can be quite busy during the summer months, as there are plenty of tourists willing to experience it for themselves.

 

Oddity Central

We wanted to hear some wild stories from former "rich kids," so we recently searched Reddit and asked adults in the BuzzFeed Community who grew up rich to share the moment they realized their lives were far from normal.

Here are their most surprising responses (some of these made my jaw drop)!

1. "I thought every family had staff. We had a chef, gardener, chauffeur, two nannies, a handyman/errand guy, and two maids. These were full-time, and several of us lived with them. We had a host of part-time staff as well. When I went to college, I was shocked by how everyone took care of themselves so well when I barely knew how to tie my own shoelaces."

—richdudethrow

2. "I remember my parents having a sit-down talk with me after a parent-teacher meeting and letting me know that there was one student in our class who was feeling insecure because his family was the only one that didn't have a lake cottage or mountain home."

—talkaboutitlater

3. "The moment I realized my parents were filthy rich was when I realized not every kid has their own house. Yes literally. My parents gave me my own personal house when I was 16. It was right next to their mansion. It wasn't too big, but when I realized that wasn't normal, that was the first time I figured out my parents were really wealthy."

—Vampyr
4. "So, I grew up rich and had no idea that it was not normal for people to rent out the whole Disney Land park for a child's 7th birthday."

—Anonymous 
5. "When I learned that no other kids got allowances of $5,000 a week to spend, I realized that my life might not be normal."

—Anonymous 
6. "Growing up, all of our dishes were made of fine china, Waterford glassware, etc. And I just thought that's what plates and stuff were made of because we didn't have anything else. Then, one time, I went to a friend's house for dinner, and we ate on colored plastic plates and non-matching plastic cups; I just thought that was the weirdest thing ever and asked why we were eating with 'camping dishes.'"

—halycon

7. "At 7 years old, I looked out the living room front windows over the blue Pacific Ocean, a clear view of Catalina Island off in the distance. On TV, Sally Struthers greeted me from Africa, surrounded by starving, desperate children. Until that moment, I thought all people lived along a coastline in beach houses."

—Anonymous 
8. "My father was a successful chemical engineer/manufacturer and private pilot. I spent my childhood in a gated fly-in community with a fully functioning airport. Not only did we have a garage full of your 'everyday' vehicles, but we also had an airplane hangar full of classic cars that my dad enjoyed restoring, World War II era 'warbirds,' as well as the modern twin-engine planes he used to fly to business meetings. We owned property in Nantucket and St. Maarten and were constantly taking extemporaneous vacations. John Travolta would walk over from time to time and shoot the shit with my dad in our hangar up until he made Pulp Fiction and was sling-shotted back into relevancy."

"When I was about 4 years old, I made a new friend at school and was invited to spend the afternoon over at his house. It was an eye-opening experience, to say the very least, and when I returned home, still very confused, I remember saying something along the lines of, 'Mommy, they live in a really small house, and they don't have an airplane hangar.'My mother was slightly horrified at the realization that this was my reality and had to explain to me that 'not everyone has the same things that we have.'"
—benadrylcumberbatch

9. "Playing around as a 9-year-old in my friend's dad's Ferrari F40 like it was a playhouse."

—Uppgreyyed
10. "As kids, we didn't realize that everyone didn't live how we did. I literally was in my 20s and living in a different part of the country when I learned that Coach bags and products were not products designed for children. I saw an adult client of mine carrying a Coach purse and thought, 'Huh, what an odd choice for an adult.' I thought adults carried bags from 'real designers' and that Coach was a training pants designer or something."

"This sounds wild, but where I grew up, Coach bags were what parents got their elementary-age girls as purses. Getting a Coach bag for a present as a kid was normal. Luckily, I didn't embarrass myself by saying anything to my client, but I still catch myself doing a double-take when I see an adult with a Coach purse."
—Anonymous 

11. "Everything is embroidered to a certain point. From zebras to toasters, everything appears to be embroidered when you don't know any better. I can't think of any reason why, but the patterns in the air just really mess with your perception. See, when you're rich and have all this extra money, there isn't any reason to not get personalized everything. So everything else seems like it was embroidered by someone or something."

—amazing_mouse
12. "My siblings and I have practiced equestrian show jumping since we were very young, and our parents initially never told us how expensive the horses (or anything for that matter) were. As we got older, we would overhear my parents talking about how much they paid for the horses and didn't really understand just how high these figures were until one day; I heard a family friend sharing that she had bought herself an apartment after saving for many years and that it cost her x much. I remember feeling paralyzed because I realized my horse was more expensive than her home."

—Anonymous 
13. "I was 23 the first time I had to figure out how to use a washing machine. To this day, I can remember how helpless I felt, staring at it like a dead fish. Had to call the family maid."

—bontem
14. "My roommate in college would order a catered meal for every dinner. He'd have a restaurant bring so much takeout that they'd bring it in those aluminum trays and heaters underneath, and a server would stick around to dish out the food and clean up afterward. It took us a couple of months to realize that he thought this was totally normal behavior and was confused as to why we made such a big deal about it."

—joeb1kenobi

15. When I started working full time, I realized the yearly tuition at my private middle and high school was more than my whole salary. Then I did the math, and my entire education cost over $1 million with no loans. I am very grateful."

—Anonymous 
16. "In high school, I moved from private to public school (by choice). I realized that it's not normal to have multiple vacation homes in and out of the country, to own more cars than people to drive them, or to have an elevator, golf simulator, and walk-in wine cellar in our main house."

—Anonymous 
17. "Honestly, it was the little things. I knew we had nicer cars than average, a bigger house, went on more trips, etc. But I thought everyone's refrigerators had wood-paneled cabinet doors, for example. The first time I saw a metal fridge, I thought it was weird, and I thought it was even weirder that the fridge and freezer were combined."

"I also thought everyone had a central vacuum system where you can sweep dirt into a little hole under the cabinets by the floor, and it sucks it up. We had these little holes all over, in every room."
—Thighmaster220

18. "There was a windstorm by our summer house that resulted in fallen trees between our house and our neighbors. It was nice because we could see more of the lake, but my parents weren't pleased that we now had to see our neighbors' house. It was a small chartreuse square from the '60s, neatly kept and didn't obstruct our view, but it was not the most picturesque."

"Well, my parents ended up buying the house and tearing it down so that we wouldn't have to look at it. At the time, I didn't think this was odd (I was actually kind of peeved because my sister and I wanted to play in the house), but looking back on it, it's a pretty wild level of privilege to be able to buy a house and tear it down just to improve your view." 
—Anonymous 
And finally...

19. "One day I was visiting family friends on the way to Lake Tahoe, and they asked what I’d been up to lately. I replied that I had just been doing the usual, waterskiing on my friend's boat and riding their yacht, which they even let me drive, sailing, and hanging out at the yacht club, and told them we’d also recently arrived home from a trip to Japan and another to Fiji."

"I then informed them that we were soon leaving for the French Riviera and Monaco, which I was excited about. The look they gave me completely shocked me, and all I could think was, 'It’s not like I’ve done anything crazy lately!' That’s when it hit me that most of the country wouldn’t just talk about those activities as casual everyday ones."
—Anonymous 

Buzzfeed

The Debt Management Office (DMO) says Nigeria’s total public debt has reached N121.67 trillion within three months.

This figure represents an increase of N24.33 trillion or 24.99 percent from the N97.34 trillion as of December 2023.

Nigeria’s public debt profile consists of domestic and external debt stocks of the federal and subnational governments — the 36 states and the federal capital territory (FCT).

According to the DMO, the increase was primarily due to new domestic borrowing by the federal government to partly fund the deficit in the 2024 budget as well as disbursements by multilateral and bilateral lenders.

“Total domestic debt was N65.65 trillion (USD46.29 billion) while total external debt was N56.02 trillion (USD42.12 billion).

“Excluding naira exchange rate movements in Q1 2024, only the domestic debt component of total public debt grew from N59.12 trillion on December 31, 2023, to N65.65 trillion on March 31, 2024.

“The increase was from new borrowing to part-finance the 2024 Budget deficit and securitization of a portion of the N7.3 trillion Ways and Means Advances at the Central Bank of Nigeria.

“Whilst borrowing, as provided in the 2024 Appropriation Act, will continue, we expect improvements in the government’s revenue to enhance debt sustainability.”

On June 13, Wale Edun, the minister of finance and coordinating minister of the economy, announced the approval of two major “financial support packages” by the World Bank — valued at $2.25 billion.

In May, the Bureau of Public Enterprises (BPE) said the federal government has secured a $500m World Bank loan to boost electricity distribution in the country.

Prior to this, the federal government had received $750 million from the World Bank for humanitarian and social reforms and $1.5 billion for its economic stabilisation plan.

 

The Cable

Indian steel maker, Aarti, is exiting the Nigerian manufacturing sector, joining a long list of companies leaving the country on account of economic woes.

The Ota, Ogun State-based steel maker, has already been put up for sale and big players have submitted unconfirmed bids ranging between $50 million and $100 million.

The steel maker’s exit is attributed to a combination of factors, notably high rate of indebtedness, challenging economy, fluffing currency, surging inflation and high energy cost, a source who spoke on condition of anonymity told BusinessDay.

“We are aware that Aarti Steel Nigeria has been put up for sale but we are yet to make our bid,” a reliable source from one of the bidding companies, who is not authorised to speak on the issue, said.

According to the source, African Industries and Bharti are bidding to buy the Indian-owned steel manufacturer for $50 million to $100 million. The process is expected to be completed in a few months.

The company is asking investors to submit their profiles, another source noted, saying that the management of the company wants to hand over Aarti to a credible investor.

This will make it the sixth company to exit Nigeria in the first half of 2024 after Microsoft Nigeria, Total Energies Nigeria, PZ Cussons Nigeria PLC, Kimberly-Clark Nigeria and Diageo PLC left the shores of Africa’s most populous nation.

The exit of Aarti will further dent the country’s perception as an investment destination and its $1 trillion gross domestic product (GDP) target, experts weigh in.

“The continuous exiting of multinationals from the economy is a serious cause for concern and this is because of the implication that it has,” said Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise.

“It has a negative implication for employment and the country’s perception as an investment destination,” Yusuf added.

In 2017, Aaarti spent $20 million to $30 million to establish a 120,000-capacity cold-rolled mill in Ota, Ogun State, to serve Nigeria’s downstream players using the steel to produce home appliances, roofing sheets, metal furniture and filing cabinets, tables and chairs, among others.

But the investment does not seem to matter much now.

 

Businessday

Nigerian energy firm Aiteo has shut down all oil production at its Nembe Creek facility, nearly 50,000 barrels per day of output, after detecting a leak, the company said on Wednesday.

Aiteo Eastern E&P said the leak was reported on Monday during routine operations in the Nembe area of Nigeria's oil-rich Bayelsa state. It is one of the most polluted places on Earth after decades of spills that have hurt farming and fishing.

The Nembe Creek facility is the largest of 11 fields under an oil mining lease operated by Aiteo, which also produces significant natural gas volumes that supply the Nigeria LNG plant at Bonny Island.

The leak's cause was undetermined, Aiteo said, adding that the shutdown was precautionary while it contained the spill.

Aiteo said it has notified regulators.

"While we regret the production losses ... and the potential environmental impact, our current priority is to expedite an efficient spill-management process in line with regulatory standards and collaborate with all stakeholders to restore production and mitigate associated risks," said Aiteo Managing Director Victor Okoronkwo.

Solomon Ukponevi, head of the country's oil-spill detection and response agency NOSDRA, said an investigation was underway.

In Nigeria, Africa's biggest oil producer, oil spills have had a catastrophic impact on communities where people have no other water supply than creeks and rely on farming and fishing.

Oil spills, sometimes due to vandalism or corrosion, are common in the Niger Delta, a vast maze of creeks and mangrove swamps crisscrossed by pipelines and blighted by poverty, pollution, oil-fuelled corruption and violence.

 

Reuters

The wave of multinational companies exiting Nigeria continues to swell, presenting a grim reflection of the nation's current economic climate. The latest casualty, Aarti Steel, a prominent Indian steel maker, is set to leave the Nigerian manufacturing sector, further deepening concerns about the country’s investment environment. This trend starkly contrasts with the Nigerian government’s professed commitment to attract foreign investment through orthodox economic policies championed by international financial institutions like the IMF and World Bank.

President Bola Tinubu’s administration has embarked on a series of reforms intended to liberalize the economy and create a conducive environment for business. These measures include the withdrawal of subsidies, devaluation of the naira, and increased taxation. Ironically, instead of bolstering investor confidence, these policies seem to be exacerbating the economic woes, leading to a spate of high-profile corporate departures.

The challenges plaguing Nigeria’s economy are multifaceted. Aarti Steel’s decision to exit is attributed to a combination of high indebtedness, a volatile economic environment, a depreciating currency, surging inflation, and exorbitant energy costs. These factors collectively create a hostile business environment, making it difficult for companies to operate profitably.

The departure of Aarti Steel is not an isolated incident. It joins a growing list of multinational corporations that have exited Nigeria in recent times, including Microsoft Nigeria, Total Energies Nigeria, PZ Cussons Nigeria PLC, Kimberly-Clark Nigeria, and Diageo PLC. The exodus of these firms not only disrupts the local job market but also tarnishes Nigeria’s image as a viable investment destination, undermining efforts to achieve a $1 trillion GDP target.

This troubling trend calls for a re-evaluation of the current economic policies. While the withdrawal of subsidies and devaluation might align with IMF and World Bank prescriptions, the adverse impacts on the local economy suggest that a more nuanced approach is necessary. Here are several strategies that could help reverse this tide and create a more stable and attractive environment for both local and foreign investors:

1. Stable Macroeconomic Policies: The government must focus on stabilizing the macroeconomic environment. This includes controlling inflation, stabilizing the currency, and ensuring a consistent regulatory framework that supports long-term business planning.

2. Improving Infrastructure: High operational costs, particularly in energy, significantly hinder manufacturing. Investing in reliable and affordable infrastructure, especially in energy, transport, and communication, can reduce these costs and make the business environment more attractive.

3. Incentives for Local Manufacturing: Providing tax incentives, subsidies for key inputs, and facilitating access to finance for local manufacturers can help boost domestic production and reduce reliance on imports.

4. Enhancing Security: The pervasive security challenges in Nigeria deter investment. Strengthening law enforcement and ensuring a safer environment for businesses and their employees is crucial.

5. Promoting Ease of Doing Business: Streamlining bureaucratic processes, reducing red tape, and enhancing transparency can improve Nigeria’s ranking in global ease of doing business indices, thereby attracting more investors.

6. Public-Private Partnerships: Encouraging collaboration between the government and the private sector can lead to more effective policy-making and implementation. This includes involving businesses in the dialogue on economic reforms and infrastructure development.

7. Skill Development: Investing in education and vocational training can create a more skilled workforce, which is attractive to both local and foreign businesses looking to operate in Nigeria.

While the exit of multinational companies like Aarti Steel paints a bleak picture, it also serves as a wake-up call for policymakers. By addressing the underlying issues that drive businesses away and fostering a more supportive environment, Nigeria can turn the tide, retain its existing investors, and attract new ones, ultimately paving the way for sustained economic growth and development.