Procter & Gamble Nigeria will be shutting down a $300 million factory the company recently opened in Agabra Ogun state, South West Nigeria.
Insider sources who spoke to local media in Nigeria said: “The company is battling with the challenge posed by government policies that regulate the importation of raw materials for its production.”
Another unnamed source told a local news website said “It is so expensive to import these raw materials which are not produced in Nigeria. Other companies take the shortcut by manoeuvring the system, but we cannot.”
Procter & Gamble global owns a key stake in the Nigerian unit, the group has not commented officially on the matter.
Sources also claimed that the company’s misfortune with its $300 million factory investment was not borne out of its making but unconnected to underhand dealings prevailing in the industry where the company operates.
“Our competitors invested much less in their factory, can manoeuvre their way in the system, and thus produce and sell for much less. We cannot do that. Our investment in Agbara is arguably the largest single investment by a non-oil firm in Nigeria. But we just have to shut it. The loss is much.”
The factory shut down is estimated to affect about 120 workers. PageOne.ng cannot confirm this figures officially as the company cannot be reached as at the time of filing this report.
BusinessInsider Nigeria claimed it spoke with an unnamed staff at the company’s sister factory in Ibadan, South West Nigeria. He gave an indirect credence to the reported closure.
“The Agbara line has only been producing Safeguards – a bar soap – for a while now, and the factory has since been turned to a warehouse or some sort, so it may be shutting down.”
“The Ibadan factory has been running optimally and I don’t think there are internal issues here,” he told Business Insider,” he said.
P&G started operations in Nigeria since 2Vicks and Always