The Nigeria Employers’ Consultative Association (NECA) has issued a strong rebuke of the Lagos State Water Regulatory Commission (LASWARCO) for its recent actions against several major manufacturing companies in Lagos. NECA’s Director-General, Adewale Oyerinde, described LASWARCO’s alleged closure of factories belonging to these companies over purported non-payment of water abstraction levies as misleading and potentially damaging to the already fragile business environment in Nigeria. The association contends that the actions, coupled with accompanying negative media coverage, amount to economic sabotage, sending a detrimental signal to potential investors and exacerbating job security fears among employees. NECA’s call for a halt to these actions and the dissemination of what it deems misinformation underscores the growing tension between businesses grappling with a challenging economic climate and regulatory bodies seeking to enforce regulations and generate revenue.
NECA’s central argument revolves around the precarious position of businesses operating in Nigeria. Oyerinde highlights the current economic downturn, emphasizing that many businesses are struggling with substantial losses. He argues that LASWARCO’s approach, characterized by demands for hefty water abstraction levies, is unreasonable and insensitive, particularly given the multiple taxes businesses already shoulder. The association fundamentally disagrees with the premise of imposing levies for water abstraction on businesses that are forced to provide their own water due to the government’s failure to adequately provide this essential resource. NECA asserts that access to water is a fundamental responsibility of the government and that penalizing businesses for filling this gap is counterproductive and detrimental to economic growth.
The controversy surrounding LASWARCO’s actions touches upon a broader issue: the balance between regulation and economic realities. NECA acknowledges the importance of responsible regulation but stresses that regulatory bodies must demonstrate empathy and understanding of the challenges faced by businesses. The association criticizes the allegedly disruptive patterns of regulatory enforcement, arguing that such actions contradict the Federal Government’s efforts to attract investment and promote job creation. NECA’s call for a more civil and legitimate approach emphasizes the need for dialogue and collaboration between regulatory agencies and the business community to ensure that regulatory measures do not stifle economic activity.
The timing of LASWARCO’s actions is particularly concerning to NECA, given the current economic climate and the wave of divestments and job losses impacting Nigeria. The association argues that the negative publicity surrounding the factory closures and the perceived heavy-handedness of the regulatory commission will further deter investment and exacerbate existing economic challenges. Oyerinde appeals to Lagos State Governor Babajide Sanwo-Olu to intervene and prevent further harm to businesses operating within the state. NECA’s appeal underscores the importance of government intervention to mediate between regulatory bodies and businesses, ensuring that regulatory measures are implemented in a manner that supports rather than hinders economic growth.
The specific case of the three companies reportedly targeted by LASWARCO – Nigerian Bottling Company, FrieslandCampina, and Guinness Nigeria Plc – highlights the potential impact of regulatory actions on major employers. These companies are significant players in the Nigerian economy, and their alleged closure, even temporarily, can have ripple effects throughout the supply chain and the broader economy. NECA’s concern is that such actions, especially if perceived as arbitrary or insensitive, could create a chilling effect on other businesses, discouraging investment and innovation. The association’s stance underscores the need for a transparent and predictable regulatory environment that provides certainty and stability for businesses to operate and thrive.
The core of NECA’s argument rests on the principle that access to water is a fundamental right and a responsibility of the government. The association maintains that imposing levies on businesses that are forced to secure their own water supply due to the government’s failure to provide this essential resource is unjust and counterproductive. Furthermore, NECA emphasizes the already heavy tax burden borne by businesses operating in Nigeria, arguing that additional levies for water abstraction further strain their financial resources and hinder their ability to operate profitably. This situation highlights the complex interplay between government responsibility, regulatory oversight, and the economic realities faced by businesses. NECA’s appeal to the Lagos State Governor underscores the need for a holistic approach that balances the needs of all stakeholders while ensuring a sustainable and thriving business environment.
