Guinness Nigeria considers export to solve forex liquidity crisis
Amidst the foreign exchange crisis in Nigeria, companies are beginning to ponder other alternatives avenues to sourcing needed forex in order to sustain their operations.
Diageo Nigeria the second largest brewer in the country has said it was looking at the possibility of exporting products, including Guinness stouts to South Africa and other countries in other to generate foreign exchange and also tackle dwindling sales in Nigeria.
The company also plans to include Origin Herb on its export list. Chief Executive Officer of Guinness Nigeria, Peter Ndegwa told Bloomberg Newswire that the decision will go a long way in helping to resolve the company shortfall of foreign currencies, which it needs to pay for imported raw materials.
Companies in Nigeria are struggling after the decline in oil prices cut government revenue and caused a shortage of foreign currency, causing the economy to shrink last year for the first time since 1991.
It makes sense that companies are trying to export more to reduce their dollar needs from the interbank foreign exchange market, Sugun Ajayi-Kadir, Director General of Manufacturers Association of Nigeria, told Bloomberg.
“It’s a difficult situation where you have nothing to export, or you can export very little, whereas your dollar need is big,” he said.
Another Nigeria companies that is already on this path is Dangote, Africa’s largest manufacturer of cement. CEO of the company Onne Van der Weije said Dangote is struggling to maintain it plants and it expansion plans.
Dangote is already exporting cement to coastal countries like Benin, Ghana and Chad. And it is now looking at other possibilities to expand it forex earning.
The Central Bank of Nigeria has recently crashed the exchange by pumping dollar into the foreign exchange market and ordering banks to sell at N360 to cater for the request of customers and to meet basic travelling allowance, medicals and tuition fees.
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