By Merciful Omoba
In a bid to boost local production and reduce Nigeria’s dependence on imports, the Federal Government has approved a set of tax incentives for manufacturers that utilize locally sourced raw materials.
The policy, announced on Wednesday, is part of ongoing economic reforms aimed at revamping the manufacturing sector, creating jobs, and conserving foreign exchange.
According to the Ministry of Industry, Trade and Investment, the incentives are targeted at encouraging backward integration and promoting local content.
“The incentives are designed to encourage backward integration and support local content development. Manufacturers that demonstrate significant use of local raw materials will benefit from tax rebates and other fiscal reliefs,” the ministry stated.
The move comes amid concerns over Nigeria’s high importation rate, with manufacturers reportedly sourcing over 70% of their production inputs from abroad.
Industry experts have welcomed the policy, noting its potential to boost the competitiveness of Nigerian-made goods.
However, some stakeholders have raised concerns about the availability and quality of local raw materials.
A senior official of the Manufacturers Association of Nigeria (MAN), who spoke anonymously, described the initiative as a step in the right direction but stressed the need for complementary infrastructure investments.
“We are optimistic about the tax incentives, but the government must also invest in infrastructure and power to make local sourcing viable,” the official said.
The government has assured stakeholders of ongoing engagement to fine-tune the policy’s implementation and tackle potential challenges.
“This is not a one-off policy. It is a long-term commitment to industrialisation,” the ministry added.
