Ban on Sachet Spirits, PET Bottles threaten N800Bn Investments, 25 Companies, 5.5M Jobs-MAN

 

The Manufacturers Association of Nigeria (MAN) said the ban imposed on the production and sales of alcoholic drinks in sachets and less than 200ml PET bottles by the National Agency for Food and Drug Administration and Control (NAFDAC),  threatens investments worth over N800 billion, as well as 5.5 million direct and indirect jobs.

This was disclosed by Chief Executive Officers and stakeholders in the industry during a question-and-answer session with news men at the press conference on the enforcement of ban on production of alcoholic beverages in sachets and less than 200ML pet bottles held at the MAN Corporate Office in Lagos on Friday 9, February 2024.

Earlier, Mr Segun Ajayi-Kadir, mni, Director General, Manufacturers Association of Nigeria (MAN), has lamented that industries have invested hundreds of billions of naira not only in the business, but overtime, in packaging and distribution, logistics and advertisement of their products, adding that most of the huge investments are backed by enormous indebtedness to both foreign and local financial institutions.

The MAN DG further said: “This is what the ban is going to wreck for no justifiable reason. The proposed policy would amount to unnecessary and avoidable debilitation of the business of local and indigenous investors who through thick and thin have kept faith with the Nigerian economy.

“They have continued to invest and reinvest at enormous cost in the economy and in the Nigerian people who are the bulk of its nearly 500, 000 direct workforce.

“By the time you factor in the workforce involved in the value chain of packaging and distribution of these products, the total direct and indirect jobs that would be threatened by the ban are more than 5.5 million.

“This is in spite of the daunting challenges that businesses have faced in the difficult times, which if we must emphasize, has led to several companies closing down and foreign investors leaving the country.”

Ajayi-Kadir added: “It must be explicitly stated that moderation and responsible drinking promote good health. Small is good, if you buy small you will consume small. If you buy big you will consume big, this is not healthy.

“Bigger sizes encourage consumption of bigger portions, while small sizes encourage portion control. “If you take away small sizes, you are encouraging excessive consumption of alcoholic beverages.

“To go ahead with the policy based on perceived danger, without empirical information and not minding the consequences, is unfair to the industry operators, the thousands of workers that will lose their jobs and inimical to the Nigerian economy.”

DG MAN also stated that the association has engaged NAFDAC in many ways that are constructive, but have not agreed on foundational issues which is on the survival of our businesses.

“We need NAFDAC to protect the sanctity of what we consume. We also believe that as a regulatory agency, they will be responsible to the survival of our business. The whole value chain involves 5.5 million people. It is likely to lead to the weakening of the enthusiasm of attracting foreign investors to Nigeria,” he emphasized.

Speaking on the development, the Executive Secretary, Distillers and Blenders Association of Nigeria (DIBAN), Mr John Ichue, said, “25 companies are affected, with an investment outlay of over N800 billion. Most of the money was borrowed from banks. And many of the companies have stocks that will last for more than two years.

“They have continued to invest and reinvest at enormous cost in the economy and in the Nigerian people who are the bulk of its nearly 500, 000 direct workforce.”

According to Ichue, the multinationals are moving away from beer because of sugar to spirit, noting that what is going on now was tried in Kenya and Tanzania and it failed.

He hinted that there is a group out there putting pressure on NAFDAC to take over their businesses, adding that the Memorandum of Understanding (MoU) that they were stampeded to sign is not a policy, so they are waiting for the outcome of the National Alcohol Policy first.

“DIBAN is saying that access control and regulation is the way forward’’, Ichue added.

Chief Executive Officer, Stellar Beverage, Mr Gandhi Anandan stated that we are living in a serious economic crisis in Nigeria and queried why the regulatory authority NAFDAC will want people to drink responsibly and the same time want people to drink large products only.

Chief Executive Officer, of Grand oak industries, Mr Wale Majaolagbe said that NAFDAC is not working in tandem with the Federal Government in its Renewed Hope Initiative, but to dash the hope of the citizenry, noting that investors borrowed money in both local and Forex, so how do they pay back the money they borrowed?

Chief Executive Officer, Intercontinental Distillers, Chief Engr Patrick Anegbe recommended access control and stricter regulation, so that people are protected and underage are kept under control, then business will grow, noting that they are ready to work with NAFDAC.

“I urge the Federal Government to come into the matter so that many jobs will not be lost across the value chains because those businesses will be dead,” Anegbe said.

There was mammoth crowd made up of the members Trade Union Congress (TUC) at the MAN House who were addressed by Mr Segun Ajayi-Kadir, mni, Director General, Manufacturers Association of Nigeria (MAN) alongside the TUC executives after the press conference on the step the Association is taking to solving the issue.

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