Adapalm Nigeria Limited, established in 1975 by the former East Central State, represents a cautionary tale of government intervention in business. Following the division of the East Central State in 1976, Adapalm was transferred to the Imo State government and expanded across 4,300 hectares in Ohaji/Egbema Local Government Area. It once provided employment for nearly 1,000 workers and contributed significantly to palm oil production.
However, the company’s decline began in 1987 when the Imo State government indigenized its operations. Tribalism, mismanagement, and dwindling production plunged the firm into disrepair. Efforts to revive it—such as the 2011 handover to Roche Group—failed due to existing debts, unpaid wages, and mismanagement. Subsequent attempts to resolve the situation, including a handover to Imo-VTU, also fell short, with Roche Group eventually pursuing legal action.
By 2022, the Imo State government sought to settle disputes out of court and partnered with investors to inject N350 billion into Adapalm. Yet, as of 2025, the company continues to struggle while global players like Indonesia’s Musim Mas Group thrive, generating billions in palm oil revenue. Adapalm’s challenges mirror those of other government-run entities in Nigeria, such as Ajaokuta Steel, which has received billions in allocations despite years of inactivity. In 2025, Ajaokuta is set to receive another N2.6 billion, adding to its N4.296 billion personnel cost allocation in the 2024 budget.
Charles Sanni, CEO of Cowry Treasurers Limited, attributes the inefficiency to government interference, emphasizing that the private sector is better equipped to handle crises and recover distressed assets. Similarly, Samuel Nzekwe, a financial analyst, advocates for a limited government role in economic activities, focusing instead on creating an enabling environment for private sector growth. While institutions like the Asset Management Corporation of Nigeria (AMCON) have played a role in rescuing distressed businesses, critics argue this is another form of government interference. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, acknowledges AMCON’s importance in stabilizing the financial system but recommends selling off assets to competent private firms to maximize their value.
Globally, private sector-led economies have demonstrated remarkable success. In China, while the government controls critical industries, the private sector contributes 60% to GDP and accounts for 80% of urban employment. The U.S., known for its free-market capitalism, limits government interference, creating a competitive environment where businesses thrive. The Nigerian private sector, however, remains hindered by government dominance. Ibrahim Ayuba, an associate professor at Mewar University, criticizes the government for crowding out private enterprise, calling for legislation to promote private-sector leadership in driving economic growth.
The World Bank underscores the private sector’s critical role in development, noting that it generates 90% of jobs, 75% of investments, over 70% of output, and 80% of government revenues in developing economies. Nigeria’s economic future depends on its ability to empower the private sector and reduce bureaucratic obstacles.
