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Procter & Gamble (P&G) shuts Nigerian plant

The leading FMCG (Fast-moving Consumer goods) is set to shut the production plant situated in Agbara Industrial Estate, Ogun State, PREMIUM TIMES can report

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The leading FMCG (Fast-moving Consumer goods) is set to shut the production plant situated in Agbara Industrial Estate, Ogun State, PREMIUM TIMES can report.

The company expanded its footprint in Nigeria in June 2017 with the commissioning of the state of the art production line which reportedly cost the firm about $300 million to complete.

The plant is for its ‘Always’ and Pampers brand of sanitary pads and diapers.
Sources at the firm said about 120 workers are being laid off as part of the shut down with some of them already receiving their disengagement letters which is to commence next month.

“About 30 staff will be left who may either be outsourced or deployed to our only remaining plant in Nigeria,” a company source told PREMIUM TIMES.

The company, a multinational FCMG with stakes in about 180 countries of the world, is the producer of Always sanitary pad, Pampers, Ariel detergent, Oral B toothpaste, Gillete shaving stick, among other products in the Nigerian market.

The shutdown is coming barely a year after the production line was commissioned by Vice President Yemi Osinbajo and Governor Ibikunle Amosun of Ogun State.

Read Also: Nigerian-based Kobo360 raises US$1.2 million seed round

Insiders familiar with the development told PREMIUM TIMES that the company is battling with the challenge posed by government policies that regulate importation of raw materials for its production. A source explained that the cost of importing raw materials was becoming unbearable for the company, which has refused to involve in shady deals in order to cheat the system and ease importation.

“It is so expensive to import these raw materials which are not produced in Nigeria. Other companies take the short cut by maneuvering the system, but we cannot,” a top official of the troubled firm disclosed.

Similarly, another factor said to be responsible for the shutdown was the unhealthy competition being faced by the company.

“Our competitors invested much less in their factory, can maneuver 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 source said.

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Zimbabwe continues battle to save currency, introduces gold coins as legal tender. Will that work?

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South African country, Zimbabwe has continued its battle at fighting inflation as its central bank will start issuing gold coins as legal tender in late July.

Soaring inflation has weakened the local currency and the central hopes the gold coin, named ‘Mosi-oa-Tunya’, after Victoria Falls, can be converted into cash in the bid to strengthen its legal tender.

Last month, Zimbabwe raised its key rate to 200 percent after it was raised from raised to 80% in April from 60%. The decision made the country’s rate the highest in the world as it battles with soaring inflation persist. The rate was last

The central bank governor, John Mangudya in a statement on Monday, said that the gold coins will be available for sale to the public in both local currency and US dollars and other foreign currencies at a price based on the prevailing international price of gold and the cost production”.

The coins are expected to act as a ‘store of value and to reduce the demand for US dollars’ – something that has been blamed for the weakening value of the local currency.

In another move 2 months ago, the Zimbabwean government has ordered commercial banks in the country to stop lending money to government at all levels, businesses and individuals with immediate effect.

Will the introduction of the coins be the final answer to Zimbabwe currency crises the possibility is low as its current inflation situation is a product of many factors which cannot be turned over night but hopefully the coins will be the flip that leads a new path.

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Somalia gives foreign banks licence to operate in decades

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The Somali government has announced the licensing of foreign banks for the first time in over two decades six weeks after President Hassan Sheikh Mohamoud was sworn into office following an elections that took years to conduct following a lingering political crisis.

The announcement which was made on Monday by the governor of the Central Bank of Somalia (CBS) Abdirahman Mohamed Abdullahi, said the war-ravaged country has granted banking licenses to two foreign institutions to operate in the country after President Mohamoud had promised to open the country to international investment during his campaigns for the elections.

The first foreign banking institutions to benefit from the decision are Egyptian bank, Banque Misr, and Turkish bank, Ziraat Katilim, who have been allowed to operate in Somalia.

“The review of the applications of these two banks has been the subject of a lengthy process of several months.

“These are two strong banks that will add value to the development of Somalia’s financial sector and contribute to the growth of our economy,” the CBS governor said

Ranked one of the poorest countries in the world by the World Bank, the average Somalian lives on less than $1.90 a day as the country struggles to recover from decades civil war and and opening its doors to foreign investments is seen as President Mohamoud fulfilment of his pledge to improve the economic situation and provide basic banking services to the population.

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