Food, Beverage Sector Loses 11,000 Jobs, 12 Firms

• Food, Beverage Sector Loses 11,000 Jobs, 12 Firms

About 11,254 jobs have been lost in the food, beverage and tobacco sub-sector in the last four years, the Association of Food, Beverage and Tobacco Employees (AFBTE) President, Patrick Anegbe, has said.

He said about 13 companies had also closed shop, noting that the figure was expected to rise if the recently-approved rise in excise duty on tobacco and other local consumer goods comes into effect from June 4.

The breakdown of the job losses showed that 8,456 jobs were lost in the drinks (breweries, bottles and distillers), 2,683 jobs in the tobacco and 115 others within the period.

Specifically, with 28,059 employed by 29 companies in 2013, 17,453 workers were retained by 16 companies, while 13 companies closed shop or relocated to other countries.

At the association’s Annual General Meeting (AGM) in Lagos, Anegbe lamented that the manufacturing sector was yet to be impacted by the Ease of Doing Business policy.

Anegbe said: “It is obvious that the impact of absorbing the cost of the revised duty would be overwhelming on players in the industry. The development will no doubt reverse some of the growth recorded by the food, beverages and tobacco sub-sector.

He said in 2017, the sector improved by 8.62 per cent over 2016, recording a growth of 2.35 per cent, stating that the manufacturers are opposed to the increase and the timing, as most players were just recovering from the negative profitability and revenue contradiction.

He said taxes are withdrawals and the increase in excise duty will reduce margins and could prompt higher unemployment. We strongly hold the view that if the intention of the government is to grow the industries, imposing exorbitant duties on locally manufactured goods is a contradiction of that objective, he stated.

Anegbe expressed the association’s worry over the introduction of borehole taxes in Lagos and Ogun states, appealing to the Federal government to come to the rescue of manufacturers in the two states, by dissuading them from compelling manufacturers to pay for providing their own water through boreholes.