The Manufacturers Association of Nigeria (MAN) has expressed strong disapproval of the Lagos State government’s decision to seal down factories belonging to Coca-Cola Bottling Company, FrieslandCampina WAMCO, and Guinness Nigeria. This action was taken by the Lagos State Water Regulatory Commission (LASWARCO), which sealed the factories for extracting groundwater for commercial purposes without proper authorization.
According to reports, LASWARCO stated that it had been in discussions with the three companies for over seven years, but they had either partially complied or failed to meet the necessary regulations, prompting the enforcement action.
In an open letter addressed to Governor Babajide Sanwo-Olu, MAN’s Director-General, Segun Ajayi-Kadir, labeled the sealing as unfortunate and poorly timed. He noted that all attempts to resolve the issue through dialogue with agency heads and ministry officials had proven unsuccessful.
Ajayi-Kadir criticized the actions of LASWARCO, stating, “MAN is appalled by the inauspicious act of the Lagos State Water Regulatory Commission in sealing factories over their purported refusal to pay the astronomical and unjustifiable water abstraction fees imposed by the Commission.” He further emphasized that this decision comes at a particularly challenging time, as MAN and LASWARCO had been engaged in constructive discussions and had reached agreements that were expected to lead to a Memorandum of Understanding (MoU) in January 2025.
Highlighting the broader economic context, Ajayi-Kadir pointed out that industries are already grappling with significant challenges, including over ₦1.2 billion in unsold inventory, borrowing costs exceeding 30 percent, and a staggering 250 percent increase in power costs. He stressed that manufacturers are also contending with multiple taxes and fees, as well as high logistics costs and insecurity that disrupt production activities.
“It is important to properly situate this inappropriate action within the context of the prevailing inclement operating environment in general and the downturn in the manufacturing sector in particular,” he stated.
Moreover, Ajayi-Kadir warned that the sealing of the factories could lead to job losses and have serious socioeconomic implications. He urged a regulatory environment that supports, rather than hinders, business operations, emphasizing the negative signal this action sends to potential investors.
