By Victor Owencho
Employers’ group says regulatory uncertainty threatens investor confidence as NAFDAC ignores suspension order
Nigeria’s apex employers’ organization has delivered a scathing critique of the government’s handling of the sachet alcohol ban, warning that contradictory policy signals and regulatory overreach are putting thousands of jobs at risk while damaging the country’s investment climate.
The Nigeria Employers’ Consultative Association (NECA) accused the National Agency for Food and Drug Administration and Control (NAFDAC) of undermining investor confidence by resuming enforcement of the ban despite a clear suspension directive from the Office of the Secretary to the Government of the Federation issued in December 2025.
“Regulatory Overreach” Disrupting Legitimate Business
In a strongly-worded statement released Wednesday, NECA Director-General Wale-Smatt Oyerinde described NAFDAC’s actions as regulatory overreach that was already disrupting legitimate businesses and unsettling ongoing investments in the beverages sector.
“Investor confidence depends on predictability and respect for due process,” Oyerinde said. “This kind of policy flip-flopping destroys the predictability that investors need.”
The employers’ group pointed out that NAFDAC’s renewed enforcement contradicts not only the December 2025 SGF directive but also a March 2024 resolution by the House of Representatives calling for restraint and broader stakeholder consultation before any action on the ban.
NECA warned that thousands of jobs across manufacturing, packaging, distribution and retail are now at risk at a time when Nigeria’s economy is already under severe pressure from high operating costs, currency volatility and weak consumer purchasing power.
Questioning the Scientific Basis
While emphasizing its support for public health objectives, NECA challenged the scientific rationale behind the ban, arguing that the current approach is misdirected and disproportionately targets compliant manufacturers.
The association noted that the alcoholic products now affected by the ban were tested, registered and periodically revalidated under NAFDAC’s own scientific procedures, with alcohol content clearly labelled and falling within internationally recognized standards.
“If these products are now being declared dangerous without presenting new scientific evidence, it raises serious questions about regulatory consistency,” Oyerinde stated.
NECA rejected claims that packaging size is the core driver of underage drinking, arguing instead that access control is fundamentally an enforcement problem at the retail level.
“Where minors obtain alcohol, the failure lies in weak monitoring of outlets and poor enforcement of age restrictions, not in the existence of sachets or small bottles that are legally consumed by adults,” the group said.
Warning of Unintended Consequences
The employers’ association warned that eliminating low-cost packaging formats could backfire spectacularly, pushing demand into informal and unregulated markets that would increase health risks while shrinking the formal economy and government tax revenues.
In a country where many consumers rely on small, daily purchases due to limited purchasing power, NECA argued that the ban fails to account for economic realities on the ground.
The group also questioned NAFDAC’s allocation of regulatory resources, pointing out that enforcement pressure is being concentrated on a regulated segment of the drinks industry while more dangerous illicit narcotics and abused pharmaceuticals continue to circulate widely among young people.
“We have a situation where compliant manufacturers who follow all regulations are being targeted, while the real threats to young people—illicit drugs and unregulated substances—are largely ignored,” Oyerinde observed.
Environmental Arguments “Conflating” Issues
On environmental concerns, NECA acknowledged that plastic waste is a valid issue but argued that using environmental arguments to justify selective product bans conflates waste policy with product safety regulation.
The association called for waste management reforms, recycling systems and extended producer responsibility schemes to be applied across all sectors, rather than singling out specific products for prohibition.
NECA’s Demands: Suspend, Consult, Collaborate
The employers’ group called for immediate suspension of all enforcement actions in line with the federal government’s earlier directive, and urged regulators to return to structured, evidence-based dialogue with industry stakeholders, public health experts and consumer groups.
NECA outlined what it considers a more effective approach: tougher retail-level enforcement of age restrictions, stronger public education on responsible consumption, intensified action against illicit products, and collaborative approaches to environmental challenges.
“Regulation should protect public health without destroying jobs or discouraging investment,” Oyerinde emphasized. “Policies that ignore evidence, economic realities and the rule of law risk doing more harm than good.”
Broader Implications for Investment Climate
Beyond the immediate impact on the beverages industry, NECA’s intervention highlights growing frustration among employers over what they see as an increasingly unpredictable regulatory environment that discourages both local and foreign investment.
The association’s criticism comes at a time when Nigeria is actively seeking to attract investment to revive economic growth and create jobs for its youthful population. Policy inconsistency and sudden regulatory reversals, NECA argues, send exactly the wrong signal to potential investors evaluating Nigeria against other African markets.
With the sachet alcohol controversy now stretching back to a 2018 memorandum of understanding that was never fully implemented, the latest clash between NAFDAC and industry stakeholders underscores what NECA sees as a fundamental governance challenge: the ability to develop and implement coherent policies through transparent, consultative processes that balance competing interests.
For Nigeria’s employers, the message is clear—regulatory certainty matters as much as the substance of regulation itself.
Sources:
- Original report: Business Day Nigeria – “NECA questions Nigeria’s policy consistency as sachet alcohol ban returns” (January 29, 2026)
- Additional context: NAFDAC enforcement actions and government directives (January 2026)
