State Emissary, November 2017. Issue 1 2017 Edition | Page 30

SM | ECONOMY
IMPLICATIONS OF
ETISALAT'S EXIT
FROM NIGERIA
In one of the biggest corporate
upheavals in Nigerian history, Abu
Dhabi-based Etisalat Group exited
the country last month after nearly
ten years of trying to promote a
successful subsidiary in Africa's
BY KELSEY LILLEY
The exit came after Etisalat failed to agree a debt
restructuring deal with leading Nigerian banks, who
had lent $1.2 billion to its erstwhile Nigerian unit,
Etisalat Nigeria, which is now called 9mobile. negotiations before the regulatory intervention that
facilitated the exit agreement. Substantial job losses
would have been the result of seizure of the company
by its creditors.
Even though Etisalat, and its partner, Mubadala, have
relinquished their Etisalat Nigeria shares and
departed the shores of the country, the consequences
of their exit will reverberate throughout the country's
telecoms and banking sectors in particular, and the
economy in general, for a long-time. Moreover, the facilitation of the agreement between
Etisalat and its creditors is in line with the policy
stance of the Nigerian government on supporting
businesses in the country. Inadequate infrastructure –
and, in some cases, yawning gaps in the regulatory
frameworks – have continued to serve as a rebuke of
the government in terms of enterprise development in
the country. But the government, through the
regulatory agencies have continued to support
businesses. Through various policy instruments and
direct financing, government's support cuts across
businesses considered to be “too big to fail” and the
SMEs.
However, the circumstances of Etisalat's exit is not
without salutary effects. With the intervention of the
Central Bank of Nigeria (CBN) and Nigerian
Communication Commission (NCC), Etisalat
Nigeria was saved an implosion, which could have
arisen from its creditors seizing the company and
selling off its assets to recover their funds. This action
was reportedly contemplated in the course of the
28 | NOV. 2017
Perhaps the biggest fallout of Etisalat's departure from