Keep up with the latest news and be part of our weekly giveaways and airtime sharing; follow our WhatsApp channel for more updates. Click to Follow us

The abrupt withdrawal of Uber from Nigeria has sparked renewed discussions about the state of the country’s business environment, particularly the challenges confronting foreign-owned companies.

Uber recently ended its operations in Nigeria after 12 years, a development that came as a surprise to many and has been linked in some quarters to what they described as an unfair and difficult business environment.

Some observers believe the company’s departure may have been connected to a July 30 directive from the Federal Airports Authority of Nigeria, FAAN, instructing airport managers to prevent Uber and Bolt from conducting commercial operations at airports under its control until licence agreements were finalised.

The FAAN directive was followed by widespread complaints over increased transportation costs at airports, leading the Minister of Aviation and Aerospace Development, Festus Keyamo, to intervene on August 27.

Keyamo directed FAAN to respond to the concerns raised by the public, but Bolt was subsequently cleared to resume its airport operations while Uber was not.

While some believe the FAAN dispute may have been the final factor behind Uber’s departure, the company rejected the suggestion, maintaining that its decision to leave Nigeria had nothing to do with FAAN’s directive on e-hailing services at Nigerian airports.

Uber said it would remain operational in other African countries apart from Nigeria and Uganda, adding that its immediate focus was on assisting drivers, riders and members of its local team during the transition.

“Uber remains deeply committed to Sub-Saharan Africa, where we continue to see robust growth and long-term opportunity,” it said.

The company further explained that it directs its investments towards markets where it believes it can create the greatest value for drivers by offering earning opportunities at scale while allowing riders to travel conveniently.

Uber acknowledged that its exit would have consequences for employees but said it would engage with affected staff directly and explore ways to support them.

“We are committed to supporting affected employees through the transition and will communicate directly with them regarding the arrangements that apply to them.

“We have been in touch with active drivers to extend a token of our appreciation as they transition over the next period.

“Uber for Business services will also be discontinued. We are in touch with partners to support them through the transition,” the company added.

The company also stated that rider information would continue to be processed in line with relevant data protection legislation, privacy obligations and Uber’s internal data protection policies.

“Uber will limit data retention to what is legally required, maintain appropriate security controls, and fulfil ongoing legal obligations and data requests,” it said.

Uber began operations in Lagos in 2014 before expanding to Abuja in March 2016, with the company describing the Nigerian capital at the time as its 400th city worldwide.

Uber Nigeria operates under Uber Technologies Inc., the US-based publicly listed company that owns the Uber platform and is headquartered in San Francisco, California.

Following the company’s departure, however, the decision has continued to attract reactions, with some critics accusing the All Progressives Congress, APC-led Federal Government of creating policies that are driving businesses away instead of encouraging investment and improving citizens’ living standards.

One of the prominent groups to criticise the government over the continued closure and downsizing of businesses in Nigeria is the African Democratic Congress, ADC, which alleged that the country was becoming a graveyard for businesses under President Bola Tinubu.

The party had reacted to Uber’s departure, alongside the closure or reduction of operations by other international companies, arguing that the development showed that the economic policies of the Tinubu administration were allegedly turning Nigeria into a “graveyard of businesses.”

In a statement issued by its National Publicity Secretary, Bolaji Abdullahi, the ADC said the increasing number of companies shutting down, reducing their activities or leaving Nigeria had highlighted the growing disparity between the government’s claims of economic improvement and the realities facing businesses and ordinary citizens.

The party questioned the Federal Government’s celebration of a marginal 0.2 percentage-point increase in Gross Domestic Product, GDP, at a time when companies were shutting down, employment opportunities were being lost and millions of Nigerians were allegedly experiencing deeper hardship.

It further claimed that while the government was celebrating a 0.2 percentage-point improvement, Nigeria’s poverty rate had risen to 63 percent, affecting an estimated 140 million people.

The party said: “When the President and his party say things are getting better, we expect them to tell us what has improved in the lives of Nigerians. They should tell us how much food their GDP growth has put on the table. They should tell us which bill it has paid. If 0.2 percent is a mark of success in their books, President Tinubu and APC should tell us what they consider as failure.”

According to the ADC, Uber’s departure after 12 years was another indication of what it described as the increasingly challenging operating conditions for businesses, particularly rising energy and transportation costs, with fuel prices increasing by as much as 1,700 percent following the removal of fuel subsidy and devaluation of the naira.

“This is precisely why the ADC presidential candidate, Alhaji Atiku Abubakar, has proposed the restoration of a targeted fuel subsidy to bring down the cost of fuel, transportation and production,” the party added.

The party also cited a report by the Manufacturers’ Association of Nigeria, MAN, which reportedly showed that 767 manufacturing companies, including 20 major international brands, had either shut down or stopped operations in Nigeria since 2023, when President Tinubu assumed office.

Among the companies the ADC listed as having exited or reduced their activities in Nigeria were Microsoft, Jumia and Bolt Food, Pick n Pay, Shoprite, GlaxoSmithKline, GSK, Sanofi-Aventis, Bayer AG, Procter & Gamble, Unilever and PZ Cussons, among others.

“Therefore, when the President announced that Nigeria has turned the corner, we wondered which corner he was talking about. If, indeed, the economy is improving or the slightest hope exists in the minds of those who run these businesses that this APC government can improve the economy, why are they closing shops and moving elsewhere?

“The painful truth is that Tinubu has turned Nigeria into a graveyard for businesses. Every business that shuts down or pulls out is a vote of no confidence in the Tinubu administration and its capacity to manage the economy.

“Each exit delivers a blow to the economy. But perhaps, more importantly, each one represents a massive loss of jobs and increased poverty.

“Therefore, when the APC and its government celebrate even the most negligible shift in GDP numbers and flaunt that as evidence to show that things are getting better, they are immediately contradicted by the painful reality that Nigerians are getting poorer and hungrier.

“Those who had jobs yesterday are not sure how long it would take before their employers would close shop, and those earning salaries are struggling even to transport themselves to work,” the party stated.

Also commenting on the development, entrepreneur Gbolahan Olusegun backed the ADC’s position, arguing that Nigeria’s difficult business climate, particularly the removal of fuel subsidy, contributed to Uber’s decision to leave the country.

“The main issue that pushed Uber out of Nigeria is the hostile business environment. This predicament was made worse by the fuel subsidy removal, which affected the cost of transport.

“The high transport fare equally affected the number of passengers that drivers get in a day, and to make ends meet, the drivers had to cut corners. And with the drivers cutting corners, Uber as a company was operating at a loss because it was not receiving what was due to it from the drivers.

“However, the last straw that broke the camel’s back was the directive by FAAN to stop the company from operating at the airport. Even though the company does not want to accept that as the final knell on its coffin, that is exactly what happened,” he said.

Olusegun criticised the government for what he described as insensitivity to Nigerians’ economic difficulties, arguing that a responsive government would not allow companies employing hundreds of people to shut down without considering the wider consequences for the economy.

“With this Uber exit, do you know how many families have been affected? So many people’s means of livelihood have been negatively affected and the government doesn’t care; that’s the irony of it all.

“I just pray and hope that those in the employ of Uber will find another way to keep their families going. But honestly, this government is not helping matters at all.

“The government should be creating an environment that would attract more companies and not contribute to the closure of existing ones, thereby worsening the unemployment situation in the country,” he stated.

Please don’t forget to “Allow the notification” so you will be the first to get our gist when we publish it. 
Drop your comment in the section below, and don’t forget to share the post.