The Nigerian Government, has announced a five-year extension for the validity of operators’ licences in free trade zones across the country.
The Minister of Industry, Trade and Investment, Niyi Adebayo, explained that the move is meant to mitigate challenges hindering operators in the zone, noting that the directive is also coming on the heels of the Nigerian Government’s ease of doing business mandate.
Speaking at a stakeholders’ forum organised by the Nigeria Export Processing Zones Authority (NEPZA) tagged “Streamlining free zone operations for global competitiveness,” the Minister urged the operators to take advantage of the extension, but ensure they file their yearly returns.
He added that the “Free trade zones are very critical to revenue generation for the Nigerian economy and can also help to improve Nigeria’s fiscal position especially given the volatility of oil prices.
He further explained that “Expanding Nigeria’s export capacity needs under the African Continental Free Trade Agreement (AfCFTA) mitigate the risk of Nigeria being a dumping ground for imports, while also boosting our foreign currency reserves. Therefore, it is absolutely necessary to adopt strategies that will transform them into a dynamic instrument for economic growth.”
He noted that despite their social and economic potentials, operations within the free trade zones are impacted by challenges such as infrastructural deficit, limited financing to ease operational constraints and misalignment of interest between operating firms and government agencies.
He stated that in December 2020, the ministry temporarily suspended the issuance of new free trade zone licenses, saying the move was motivated by concerns that the free trade zones have not delivered on expected contribution for employment, government revenue and export proceeds as envisaged in various national development plans.
The Managing Director, NEPZA, Prof. Adesoji Adesugba, said stakeholders must come together to maximise the potential of the scheme, adding that over $25 billion have been generated through the scheme.
On his part, the Managing Director, Oil and Gas Free Zones Authority (OGFZA), Umana Okon Umana, said the success of any country is based on development of its free zones, saying that Nigeria has not done so much to maximise the potentials of the free zone.