The Senate has passed a bill making it compulsory for all raw materials to undergo at least 30 per cent local processing before they can be exported from Nigeria.
This decision followed the adoption of the report by the Senate Committee on Science and Technology on the amendment of the Raw Materials Research and Development Council Act, 2022.
The bill, sponsored by Senator Onyekachi Nwebonyi, who represents Ebonyi North, is aimed at promoting value addition, strengthening Nigeria’s local manufacturing sector, reducing dependence on imports, and driving sustainable economic growth.
According to the new provisions, exporters who fail to meet the 30 per cent local processing requirement will be subjected to a 15 percent levy on the export value of the raw materials. They may also face suspension or revocation of their raw material value addition certificates.
The level of processing will be determined by factors such as the nature of the material, the technology applied, and the standards required by the intended export markets.
The Raw Materials Research and Development Council will be responsible for issuing detailed guidelines on what qualifies as 30 percent processing. These guidelines will include clear benchmarks for quality, safety, and environmental sustainability.
Raw materials exported without meeting the required processing threshold will be classified as “smuggled goods” and penalised under existing Customs and trade laws.
The bill also seeks to encourage local industries by reducing the importation of raw materials that can be sourced or processed within Nigeria.
Speaking on the development, Senate President Godswill Akpabio described the amendment as a significant milestone in the country’s march toward industrialisation.
“This bill is expected to create job opportunities, boost Nigeria’s trade competitiveness globally, and promote responsible management of the country’s natural resources. It will increase capacity to reduce reliance on totally imported raw materials, promote sustainable resource management, environmental protection through the adoption of best practices in the utilisation of locally sourced raw materials, and in addition, it will reduce carbon footprints.
“This will support the adoption of advanced processing technologies in local industries to improve efficiency and product quality,” he said.
Akpabio further noted that the new law would help cut down imports of raw materials already available locally, protect domestic industries from unfair competition, and encourage investments aimed at enhancing Nigeria’s processing capacity.
He added that it would also support the adoption of modern technologies to boost efficiency and quality in local manufacturing, thereby attracting investors interested in processing raw materials within Nigeria, which would give an additional boost to the nation’s industrial sector.