Multi-National Corporations In The Nigeria’s Economy: The Questions and the Responses
“When shall we continue to be snared by your lies? The blood you keep spilling, the torment you keep piling on this land, shall someday rake it horns on you and when the keeper comes, tell him this story I weave from my lonesome hut. For I am sad and somber of what I am seeing in Africa…”~Lateef Raji
United Nations, 1974, defined Multi-National Corporations (MNC) as an enterprise which own or control production or service facility outside the countries in which, they are based. Going by this definition, MNC can be classified as a centrally controlled oligo-polistic enterprise in which ownership, management, production, sales and other activities extends over jurisdiction.
Expediently, MNCs are seen as engine room of growth and economic development in their host states most especially in the countries of the south i.e., as foreign investors, they injects financial resources into the economy of their host states and these resources they inject fill resources gap. MNCs also help in the transfer of technology from their headquarters to where technology is backward.
MNC provide jobs for the unemployed, improves quality of labour and to some extent, generate revenue to their host states through royalty and tax they pay thereby leading to improved standard of living of the people in their host states.
However, MNCs are reputed for tax evasion. They are rooted in business restriction, produces quality products in their home states and questionable products for their host states. The technology they claimed to be importing and transferring into developing countries hosting them is mostly obsolete and capital intensive.
Also, MNCs usually operates in enclave economy. They employ few local hands, designate particular area of operation where local hands can work without moving forward, creates inappropriate consumption pattern that is equivalent to cultural imperialism.
MNCs in the countries of the South like Nigeria have stunted the growth of local industries. Rather than invest in local areas, they buy them up and merge them with theirs. MNCs engage in aggressive marketing and advertisement which local companies don't have the resources to do.
The MNCs especially in the developing nations have used their economic power to destabilize and pollute local environment by bribing local, state and central officials from implementing policies that are antithetical to their economic progression.
Furthermore, they get involved in the politics of their host countries with enormous secret financial and material donations to political parties involved in electoral competitions in order to ensure that anyone that emerges favours their establishments.
It is worth-mentioning that MNCs, through unholy alliance with their home states, over-throws the government of their host states (Davies, 2014).
MNCs In the Nation of Nigeria
Nigeria, according to the International Monetary Fund (IMF), is classified as a country of the south with the highest Gross Domestic Products (GDP) and the fastest growing economy on the continent of Africa. Nigeria has a population of over 170million people, divided along ethic and religion lines with 45% of her people wallowing in the euphoria of squalor, abject poverty and maximum starvation (Omo Omoruyi, 2012).
The MNCs operating in the Nigeria are numerous, but the most powerful among them are as follows; Shell, Chevron, Cadbury, Guinness, Coca-Cola, Dangote, MTN, GLO, Etislat, Airtell, UBA, First Bank, Standard Chartered, AICO, KPMG, Philips Consulting, Kaymu, UPS, PWD, UAC, Eco Bank, Peak Milk, Cowbell, Samsung, Nokia, Toyota, Peugeot, Total, Nokia, Accenture, Jumia, Air France, Ericson, Unilever, GlaxoSmithKilne, OANDO, Conoil, etc.
The Pro of MNCs in Nigeria
Affirmatively, MNCs have contributed immensely to the economic development of Nigeria. The likes of MTN and ETISALAT have helped significantly to advance Information and Communication Technology (ICT) in Nigeria. Today, multi-national communication firms in Nigeria serves as internet providers to many organizations, individuals and group of individuals. The National Communication Commissions (NCC) had also revealed that more than 10 million Nigerians use MTN internet service to transact business.
The MNCs operating in Nigeria, according to the Trade Union Congress (TUC), have more than 70, 000 Nigerians on their payroll with enhanced remunerations and better conditions of service. Most MNCs pays better salary than the local and public corporations. Employees in MNCs enjoys better standard of living than their contemporaries in local corporations and public service.
MNCs injects financial resources into the Nigeria economy when kick-starting their businesses. Take for instance, the MTN Nigeria, after constructing her offices nationwide, injected over N35billion into the Nigeria economy when commencing operations in year 2002.
The taxes and royalties that Guinness Nigeria, MTN Nigeria, Etisalat Nigeria, Airtell Nigeria, GLO Nigeria, UBA Nigeria, UAC Nigeria, Eco Bank Nigeria, UAC Nigeria, Shell, Chevron and First Bank Nigeria, according to the Federal Inland Revenue, pays into the Nigerian government accounts annually constitutes 2% of the country's total revenue per annum.
In term of Corporate Social Responsibilities, MNCs are the best. The contributions of Guiness, Cocacola, GLO, MTN, Airtell and ETISALAT Nigeria to sports development in Nigeria are immensurable. The afore-mentioned organizations have sponsored both local and international competitions than any other organizations in Nigeria. For 8 years running, Glo Nigeria had been sponsoring the Nigerian Football League. Guinness Nigeria pays salary of the secretariat staff of the Nigerian Football Federation (NFF). MNCs have donated lecture theaters, e-library, books, vehicles, etc to tertiary institutions and organizations. They have contributed significantly into the development of Nigeria's entertainment industry by signing local Artists as Corporate Ambassadors. They gave Scholarship awards to indigent students. They have changed the fortune of many hopeless Nigerians from nobody to somebody through their endless and highly intimidating promos.
Also, MNCs, as a result of their aggressive marketing policy, serves as major source of income to many advertising companies and media houses in Nigeria. Take for instance, 70% of online news mediums in Nigeria are on the payroll of Konga, Jumia and kaymu (Timothy Odedina, 2014).
The deficiencies of the MNCs in Nigeria
Without being immodest, let me confidently state that the technology that most MNCs in Nigeria claims to be importing into Nigeria are obsolete, sub-standard and inferior to what they use in their home countries. The used Apple and Samsung products imported into Nigeria from the United Kingdom (UK) lasts longer than the brand new products imported into Nigeria. According to an official of the Standard Organization of Nigeria (SON) who spoke to me on the condition of anonymity, used Samsung Computers brought from UK functions longer than the brand new ones imported into Nigeria.
Shade Ojo, a friend based in the UK had also lamented that the taste of peak milk produced in Netherlands is more pleasurable and hygienic than the one produced in Nigeria. Consumers have also alleged that the coca-cola products being sold in London are incomparable in terms of quality and standard with the ones in the Nigeria market.
Nigeria has directly and indirectly been turned to a dumping ground by multi-national corporations. The quality of services of MTN, South Africa is different from that of Nigeria. While MTN internet runs faster in South Africa, it is slower in Nigeria. Clarity, Concise, Accuracy and Brevity exists only in the communication dictionary of MTN South Africa; what MTN Nigeria serves Nigerians are mediocre and quantity services , notwithstanding, the communication giant makes twice more of the profit she makes in her home state in Nigeria. The relocation of MTN Corporate and Operational Headquarters from South Africa to Nigeria in year 2013 is a point of reference.
Also, MNCs in Nigeria evade tax. According to Femi Bankole, a tax consultant, the tax MNCs pays annually which Nigerians thinks is of higher dimension is less than 50% of what they ought to be paying into the Nigerian government accounts. Bankole, while speaking on Channels Tv in June 2014, explodes that what MNCs does is to pay 50% tax, bribe top officials of Nigeria's tax regulatory agencies with 20% and pockets the remaining 30%.
Another shortcoming of MNCs in Nigeria is the unpardonable marginalization in their labour policy. Today, no Nigerian can move beyond Directorate level in Shell Development Petroleum Company. Nigerians can't head the organization. Today, the Managing Director of Guinness Nigeria is a non-Nigerian which contravene Nigeria's policies of nationalization and indigenization.
Furthermore, MNCs, despite being reputed for paying higher wages and salary than local corporations, are renowned for undermining the dignity of labour. Most MNCs in Nigeria today outsources Nigerian Graduates into their organization. They no longer recruit directly from labour market. They now engage companies owned by their agents to recruit for them. Sadly, the same responsibilities given to those directly employed by the Human Resources Unit of these MNCs are assigned to those outsourced and cheaply paid. Today, I can assertively declare without any fear of intimidation that Eco Bank Nigeria, First Bank Nigeria, UBA Nigeria, Guinness Nigeria, etc outsources their new staff and use the graduates among them for 4 years before being asked to write conversion test. Those who fail the test are asked to go without any benefit while the few who pass are converted to full staff. Again, let me explicitly say that 35% of Chevron Staff are on contract basis. In addition to that, Eco bank, First Bank, etc Nigeria runs each of their branches with just 5 permanent staff; the rest are on contract appointment.
MNCs are agents of globalization trying to introduce cultural imperialism which they have succeeded in introducing. The western nations, through their corporations in Nigeria, have forced Nigerians to jettison traditional mode of dressings. Today, all the MNCs operating in Nigeria allow only English mode of dressing in their organizations at the detriment of Nigeria's traditional attires.
In a related development, MNCs in Nigeria have stunted the growth of most of the local companies. The Nigerian Telecommunications (NITEL) parked off after the emergence of communication giants like MTN and Airtel. All efforts made by Nigerian government have been frustrated by these Communication giants via the intervention of their home states. Today, NITEL which use to be the pride of all Nigerians home and abroad is practically dead. Nigerian government, rather than helping the defunct made-in-Nigeria's Oceanic Bank International to scale through the economic crisis of the year 2009, sold it off to a relatively unknown Eco bank Nigeria at a meagre amount of money.
The Nigerian government looks weak and inefficient to confront the hegemony of the MNCs in Nigeria. Despite calls by the Nigeria Labour Congress and Trade Union Congress for abrogation of contract recruitment of personnel by MNCs in Nigeria, the government has refused to take action. However, it has been alleged by the organized labour unions that MNCs do secretly make donations to political parties during electioneering so that anyone that wins implements policies that are favorable to their common existence. Apparently, the afore-mentioned has made Nigerian government to compromise standard at the detriment of her people.
The multi-national's advertising and delivering corporations in Nigeria have pushed the local ones into extinction through their aggressive marketing and advertising strategies. Take for instance, the Nigeria Postal Agency has been sent out of business by the likes of DHL, ESS, UPS Red Star Express, etc.
Additionally, in the words of Davies A., a University Don, the MNCs have been caught in the web of collaborating with their home states to over-throw legitimate government antithetical to their progress in their host states. For an example, a former Iran Prime, Mosadeq was controversially removed for plotting against the interest of American Corporations in his country. A Guatemala's former leader, Col. Label was gunned down for attempting to revoke the Certificate of Occupancy of about 234,000 hectares of land owned by an unnamed American Company. In 1973, a Chilean Leader, Salvador Alliande was over-thrown and killed with his wife and children for implementing policies detrimental to the interest of MNCs in his country.
In Nigeria, the Mohamadu Buhari's military regime as Head of States was allegedly terminated by the western nations for refusing to implement IMF policies such as devaluation of naira, removal of fuel subsidy, liberalization of trade etc. Buhari's successor, Ibrahim Babangida introduced Structural Adjustment Programmes (SAP) which has similar features with that of IMF policies. Babangida, with the back up of US, UK, UN, IMF, World Bank, ended up spending an uninterrupted 8 years as Nigeria's helmsman.
In conclusion, dear Readers, going by the above empirical affirmations, I wish to patriotically and sincerely advise the Nigerian government to braze up and start acting like a sovereign state. Nigerian Government should wake up from her slumber and deliver Nigerians from being exploited in their fatherland. The hegemony of MNCs must be drastically checked. A situation whereby the outsourced Airtell Nigeria staff serving as Customer Care Officers are paid N50,000 monthly despite working from 7.am to 7.pm is unacceptable to me. Nigerian government, I say again that this is totally unacceptable.
I say no to cultural imperialism, neo-colonialism and perpetual hegemony in Nigeria. I call for the implementation of the policy of nationalization to the fullest. I also put it to the Standard Organization of Nigeria to braze up and challenge the MNCs dumping sub-standard goods into our countries. Follow come tyres last longer than tyres bought in Nigeria. Coca-cola produced in London is hygienic than Coca-cola Nigeria. Which Way Nigeria?
Maxwell Adeyemi Adeleye, Magodo, Lagos.
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@adefolamax on twitter