Exit of Shoprite Will Not Affect Nigeria’s Economy Negatively—Expert

The President, Association of Capital Market Academics of Nigeria, Prof Uche Uwaleke has said the planned exit of Shoprite will not have any significant negative impact on the Nigerian economy.

He said this while reacting to reports that the company would be discontinuing it’s operations in Nigeria.

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Uwaleke who is a former Commissioner of Finance in Imo State said the exit of Shoprite should be seen as an opportunity for the country to tackle it’s dependence on importation of foreign goods.

He said, “The exit of Shoprite or any other foreign business for that matter, ordinarily should be a cause for concern especially for a country like Nigeria that is in dire need of foreign direct investment.

“The importance of Foreign Direct investment especially in the area of job creation cannot be over emphasized.

“With particular reference to Shoprite, the big question is: what is the net contribution of the company to the Nigerian economy?

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“Beyond the menial jobs, how many Nigerians are in the employ of the SA firm?

“Aside the crowding out effect of Shoprite on local competitors, its operations in Nigeria have also contributed to dwindling foreign reserves through imports that serve to satisfy the appetite of wealthy Nigerians for foreign goods.

He said while Nigeria is in serious need of investment inflows, the government should be mindful of the quality of investments that come into the country.

He added, “The type and quality of Foreign Direct Investments should matter for Nigeria.

“What the country needs now are foreign direct investments in manufacturing, agriculture value chain, Telecoms and Information Technology and not businesses that promote the consumption of foreign goods and perpetually leave us import-dependent.

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“Which is why I think Nigerians should not lose sleep over the exit of Shoprite. Where possible, the company should be bought over by Nigerians.

“As Shoprite is exiting, some other companies are waiting to berth. The right business environment post COVID’19 will bring this about.

“The country’s economic potentials and market size are such that the World cannot ignore.”

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