MAN, Customs address barriers against manufacturing

Manufacturers Association of Nigeria (MAN) and Nigeria Customs Service (NCS) say they are committed to Nigeria’s economic transformation through enhanced manufacturing sector performance.

MAN and NCS highlighted the need for clear alignment between customs trade facilitation objectives and manufacturing sector development needs to boost manufacturing operations for the overall benefit of the Nigerian economy.

President of MAN, Otunba Francis Meshioye, and Comptroller General of Customs, Adewale Adeniyi, resolved to address barriers that mitigate manufacturing at a strategic engagement on Friday, September 26 in Lagos.

MAN President, Meshioye, listed operational challenges faced by the manufacturing sector, which include implementation of the 4% FOB, multiple checkpoints as threat to trade facilitation, multiple alerts in the clearance system and B’Odogwu platform glitches.

Responding, the Comptroller General of Customs, Adeniyi, who listed various trade facilitation initiatives undertaken by the Service, expressed strong commitment to balancing the Service’s revenue generation mandate with innovative trade facilitation measures.

The following were concrete outcomes of the interaction:

Nigeria Customs Service announced that following consultations with the Honourable Minister of Finance and the Coordinating Minister of the Economy, approval has been granted for strategic exemptions from the 4% FOB charges on the following, among others:

i.        Importation of raw materials, spares, and machines by the manufacturers who are beneficiaries of concessions contained in Chapters 98 and 99 of the Customs Tariff, Manufacturers who are currently on chapters 98 and 99 are advised to apply for pre-release of the consignment to avoid payment of demurrage.

In addition,

ii.        Members of MAN who import raw materials, machines, and spares that are not currently on chapters 98 and 99 to be onboarded in order to enjoy the exemptions provided in 5(i) above.

iii.        MAN, NCS, and the Federal Ministry of Finance will work together for the inclusion of manufacturers that are currently not on chapters 98 and 99.

iv.        An immediate tripartite consultation of the Federal Ministry of Finance, NCS, and MAN would be held immediately to work out the modalities for expedited onboarding of manufacturers on chapters 98 and 99.

v.        In the meantime, the 4% FOB payments already made by manufacturers who are yet to be onboarded to chapters 98 and 99 will be held as credit and be utilized for future customs-related transactions after their onboarding.

vi.        Government projects with Import Duty Exemptions Certificates.

vii.        Goods imported for Humanitarian, Life Saving and other related purposes.

viii.         Beneficiaries of the Presidential Initiative for unlocking Healthcare value chain.

ix.        Commercial airlines’ spare parts.

Manufacturers Association of Nigeria commends the AEO scheme; hence, it was agreed that a clear guideline for admission would be issued by the Nigeria Customs Service.

The gesture of these exemptions presents concrete evidence of the Service’s commitment to supporting critical sectors of the economy as it continues to maintain appropriate revenue collection frameworks.

Beyond existing exemptions, discussions focused on additional trade facilitation initiatives being implemented by the Nigeria Customs Service to support manufacturing operations. These include the development of one-stop shop frameworks designed to streamline regulatory processes and eliminate bureaucratic bottlenecks, systematic reduction of unnecessary checkpoints that add costs without corresponding value, and integration of digital solutions to accelerate legitimate trade processing as well as maintain security standards. The Service also outlined technology-driven initiatives aimed at providing real-time clearance capabilities and automated risk assessment systems that reduce compliance costs for legitimate operators.

Both organizations agreed to establish formal consultation mechanisms ensuring regular dialogue on policy developments affecting manufacturing operations, including proactive engagement on customs policy changes before implementation, feedback systems allowing real-time assessment of policy impacts, and periodic review meetings to assess progress and identify new collaboration opportunities.

The engagement emphasized economic impact considerations, with both organizations committed to supporting Nigeria’s economic diversification objectives through job creation, export promotion, foreign exchange conservation through import substitution, and development of industrial clusters supported by predictable customs environments. Technology partnerships were also identified as critical enablers.

Moving forward
The Nigeria Customs Service commits to maintaining ongoing consultation with manufacturing sector stakeholders, continuing development of trade facilitation infrastructure supporting industrial growth, implementing technology solutions that reduce compliance costs, and providing regular briefings on policy developments. The Manufacturers Association of Nigeria commits to constructive engagement in policy dialogue processes, providing sector-specific expertise to inform customs policy development, supporting member compliance with regulations, and collaborating in developing industry best practices.

This engagement highlights a strengthened partnership between two critical institutions supporting Nigeria’s economic development. The outcomes achieved is evident that constructive dialogue produces superior results for all stakeholders and is essential in maintaining the highest standards of regulatory compliance and economic governance. Both organizations look forward to implementing the agreements reached and continuing to build a customs environment that supports manufacturing excellence and meeting national revenue and security objectives.