A significant portion of Ogun State’s table water producers, vital for daily sustenance, are facing an existential threat, with over 25% having shuttered their operations within the past year. This stark reality, unveiled by the Association of Table Water Producers of Nigeria (ATWAP), Ogun Chapter, paints a grim picture of the challenging economic landscape facing small and medium-sized enterprises (SMEs) in the region.
Babatunde Lawal, the association’s chairman, speaking to the News Agency of Nigeria (NAN), attributed this alarming trend to an “unfavourable business environment,” a phrase that, in essence, translates to a relentless barrage of financial and operational obstacles. “More than 25 per cent of our members have exited the industry because the environment is not conducive for production,” Lawal stated, highlighting the severity of the situation. This exodus from the industry, which once boasted over 2,500 registered members across the state, signals a deeper economic malaise.
The burdens weighing down these producers are multifaceted. Lawal identified unstable power supply as a primary culprit, forcing reliance on costly generators and drastically reducing profit margins. “Most producers rely heavily on generators, which significantly reduces their profit margins,” he explained. This dependence on alternative power sources is a common plight for many Nigerian businesses, where grid reliability remains a persistent challenge. According to the World Bank, Nigeria’s access to electricity is among the lowest globally, creating significant operational hurdles for businesses.
Adding to the strain is the issue of multiple taxation, a recurring grievance among SMEs across the country. This, coupled with what Lawal describes as a “lack of supportive policies from the government,” creates a perfect storm for business failure. “In addition, no water producer can survive these numerous challenges without being part of the association because we protect our members’ interests,” he emphasized, underscoring the necessity of collective action in a hostile economic climate.
Furthermore, the bureaucratic hurdles associated with renewing operational licenses, particularly with the National Agency for Food and Drug Administration and Control (NAFDAC), have compounded the producers’ woes. Lawal decried the “cumbersome” process, adding another layer of complexity to an already challenging operating environment. NAFDAC licensing is critical for consumer safety, but when the process becomes unduly burdensome, it can stifle legitimate businesses.
For many families, these closures translate to job losses and increased financial insecurity. The ripple effects of these business failures extend beyond the immediate entrepreneurs, impacting their employees, suppliers, and the broader community. As I consider the implications, I realize that these aren’t just statistics; they represent livelihoods and the ability of families to provide basic necessities.
The ATWAP chairman’s plea to the federal and state governments to create a more enabling environment is a call for urgent action. “The situation could lead to increased unemployment and economic hardship for many families,” he warned. This is not merely a business issue; it is a societal concern that demands proactive intervention.
The direct impact on essential services like water production hits close to home. It’s a reminder that economic policies have real-world consequences, affecting the very fabric of our communities. It is imperative that policymakers listen and respond effectively to safeguard these vital businesses and the people they serve.
