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Minister of Industry, Trade, and Investment, Jumoke Oduwole
The Federal Government has announced plans to overhaul and modernise the operations of free trade zones in the country by tightening regulations to combat widespread misuse and corruption that has affected its contribution to national growth.
The Minister for Industry, Trade and Investment, Jumoke Oduwole, said the revamp is necessary because a lot of companies operating in the free zones have not been exporting enough.
Nigeria started the free zones in 1992 to promote exports, attract investment, and foster technology transfer. The zones were set up to boost exports but companies also use them to sell into the domestic market at the expense of local competitors.
This policy initiative has led to the entrance of more than 600 firms operating in 50 zones across the federation.
Oduwole, speaking in an interview with Bloomberg published on Thursday, noted that the government is also considering allowing companies to raise equity in Nigeria to finance investment and expansion.
She said, “A lot of companies operating in the free zones have not been exporting enough, The fiscal authority is pushing you to lose your license, but we are pushing you to pay tax. There are plans to overhaul scores of free customs zones it operates across Africa’s most populous nation to clamp down on misuse.
“I have visited two free zones already and I am visiting another one in Lagos to make sure that we support them to produce more for export,” the minister said. “Companies target Nigeria for the volume but we are targeting Africa.”
But many of the zones lack amenities, which pushes up costs and makes them less competitive. To fix the problem, the ministry is studying requests to let zone-based companies raise equity in Nigeria to finance investment and expansion, she said.
The report added that lawmakers are considering a proposal to withdraw licenses from zone-based firms that sell more than 25 per cent of their production to Nigeria.
On Tuesday, the Comptroller-General of the Nigeria Customs Service, Adewale Adeniyi, revealed that Nigeria recorded a total trade value of N196.94tn for 2024.
Adeniyi said the figure reflects a 179.3 per cent increase from N70.50tn recorded in 2023.
“The total trade value handled by the Service in 2024 amounted to N196.94tn, compared to N70.50tn in 2023, representing a 179.3 per cent increase,” the NCS boss said.
On the export performance, the comptroller-general said the service recorded a cost, insurance, and freight value of N136.65tn in 2024, representing a 219.5 per cent increase from N42.77tn in the previous year.
“While the number of export transactions remained relatively stable at 38,199 compared to 38,294 in 2023, we witnessed a substantial increase in export volume, processing 12.35bn kilograms in 2024 compared to 3.70bn kilograms in 2023,” Adeniyi said.
“This 234 per cent increase in export mass, coupled with the higher value, indicates a robust growth in our export trade and suggests increasing competitiveness of Nigerian products in the international market.”
