Federal Gov’t Not Scrapping Free Trade Zones – NEPZA

Managing Director of the Nigeria Export Processing Zones Authority (NEPZA), Dr Olufemi Ogunyemi has assured operators of the Free Trade Zones that the Federal Government was only poised to boost global competitiveness of the scheme and not annihilate it as held in some quarters.

Ogunyemi who is also the Chief Executive Officer of the agency made the remarks at the 3rd Nigeria Economic Zones Association meeting on Thursday in Lagos.

The Managing Director, in a statement by the Head, Corporate Communications of NEPZA, Martins Odeh, explained that the mandate of the scheme that aimed to fast-track industrialisation, non-oil trade, employment generation, export among others, was too precious for the government to now circumvent.

According to Olufemi, the Authority remains a product of law of the parliament positioned to drive economic growth through the Free Trade Zones scheme, in line with global best practice.

The stakeholders have since the introduction of the proposed Tax Reform Bills 2024 raised concerns over the likelihood of scrapping the scheme.

Ogunyemi, however, said the new tax policy was not completely bad, adding that the stakeholders should attend the public hearing on the bills to canvass their positions.

He explained that the proposed tax bills were aimed at harmonising the country’s tax system, stating that they were not constructed to destroy the scheme.

“We are working behind the scene to ensure that genuine concerns of the stakeholders with regards to clauses that tended to have placated the scheme’s incentives are expunged in the interest of all,” he said.

He emphasised that President Bola Tinubu remains the chief promoter of the SEZ scheme and committed to nurturing it to full maturity.

The NEPZA boss also said the association’s annual gathering highlighted stakeholders’ shared commitment to advancing the prosperity of Nigeria through efficient operation and strategic utilisation of Special Economic Zones.

“The country’s economy is navigating challenging times that demand innovative thinking and strategic tools. The Renewed Hope Agenda of President Bola Ahmed Tinubu has laid out a robust framework to guide our economy toward revival through the 8 Presidential Priorities.

“SEZs are positioned as a pivotal economic instrument to expedite the realization of 5 of these priorities, which are food security, poverty eradication, economic growth and job creation, inclusivity, and indirectly, security,’’ he said.

Ogunyemi further stressed that the event provides a critical platform to examine key issues, foster collaboration, and strengthen the synergies necessary to align SEZs with these Presidential priorities.

“Achieving this alignment calls for a concentrated focus on skill enhancement, industrialisation, economic diversification, and export promotion. SEZs remain central to our mission to attract investment, create jobs, and establish globally competitive industries,” he said.

According to him, enhanced collaboration between government agencies is key to improving SEZ operations and delivering world-class services.

“Notably, AfCFTA data highlights Nigeria’s strategic role as a central hub in Africa’s trade routes, emphasising the need for concerted efforts to ensure the country does not become a dumping ground for goods from other African nations.

“Nigeria has nurtured the SEZ scheme for more than three decades, and the fruits are just starting to manifest. The SEZ average cumulative annual growth rate for export stands at 0.79% while domestic export is 3.26%. Additionally, FDI has grown at an average annual rate of 3.68%, while LDI shows a growth rate of 1.49%.

“Other key indicators include backward linkage at 2.80%, duty (Custom Duty and VAT) at 3.34%, and PAYE at 4.21%. It is now imperative to focus on executing strategic reforms that accelerate this growth trajectory while safeguarding its progress,’’ Dr Ogunyemi said.

He noted that these reforms must foster a symbiotic relationship between investors and the nation.

“In light of AfCFTA’s acceptance of SEZ-produced goods, Nigeria must adopt policies that attract FDI, enhance investor trust, and make investment processes competitive and seamless.

“I reiterate NEPZA’s unwavering commitment to collaborating with all stakeholders to build a thriving SEZ ecosystem. Together, we can position Nigeria as a leader in industrialisation and trade, fostering sustainable economic growth for generations to come,’’ he said.