3 November 2017

Nigeria: MAN, RMRDC Seek Cet Review Over Low Industrial Capacity

The Manufacturers Association of Nigeria (MAN), and the Raw Materials Research and Development Council (RMRDC), have sought for a review of the Common External Tariff (CET) policy before its final take-off in 2019/2020.

According to MAN, the reason it is calling for the review is based on the fact that Nigeria's industrial capacity is above 60 per cent when compared with that of other countries in the region.

The Chairman, Corporate Affairs and Strategic Planning Committee, MAN, John Aluya, while making a case for the review, asked: "How then do we compare a situation whereby countries of the region are allowed three per cent or 117 tariff lines to deviate from a total of 5889 tariff lines for the national interest as being adequate for a country like Nigeria? This, by all international trade negotiation standards is not appropriate for Nigeria considering its industrial capacity."

Aluya made this call during a business roundtable on critical issues on raw materials sourcing for manufacturing industries in Nigeria.

He therefore reiterated the need for renegotiation of the CET, saying that if not reviewed, Nigeria's industrial potential and development might be sacrificed on the altar of uncoordinated regional integration.

"The CET as structured to us is not in the interest of Nigeria. The opinion is based on the fact that Nigeria's industrial capacity is above 60 per cent when compared with that of other countries in the region," he said.

Earlier, the Director General, RMRDC, Dr. Hussaini Ibrahim, said the nation's manufacturing sector is facing stiff competition due to bilateral and multilateral trade agreements. These include the ECOWAS Trade Liberalisation Scheme (ETLS), Common External Tariff (CET), impending Economic Partnership Agreement (EPA), and other World Trade Organisation (WTO) trade policies that are transforming the world economy into a vast free-trading zone.

Ibrahim, who was represented by the Director, Technology Development, RMRDC, Dr. Mohammed Buga, noted that where raw materials or their local substitutes are unavailable locally, the government should apply the relevant tariffs for the importation of such raw materials or inputs. This should be done through the Tariff Review Board of the Federal Ministry of Finance, on the recommendations of the Tariff Technical Committee (TTC).

He added that there is need for investment in research and development to identify local substitutes or alternative raw materials in manufacturing in Nigeria, pointing out that research and development in tertiary educational institutions and government owned research institutes are not up to the required level.

According to him, there is also a poor linkage between the researchers and prospective investors to commercialise these innovations, advising that one of the ways to address this challenge is for manufacturers themselves to get involved in research and development activities for the development of local raw material substitutes to imported ones.

Nigeria

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