Nigerian govt to suspend tariff, import duty on staple foods, pharmaceuticals, others

The Nigerian government has proposed a strategy to reduce inflation by suspending import duties and tariffs on food, pharmaceuticals, raw materials for industry, inputs for agriculture, and other items.

This was revealed by Finance Minister Wale Edun during a recent presentation of the ASAP (Accelerated Stabilization and Advancement Plan).

Edun claimed that the strategy was intended to put an end to Nigeria’s economic suffering and had just been submitted to President Bola Ahmed Tinubu.

This occurs at the same time that food and headline inflation rates in Nigeria rose to 40.53 percent and 33.69 percent, respectively.

For Nigerians, inflation signals an end to their intolerable suffering as their purchasing power declines due to rising prices while staying constant.

Edun offered that when the fiscal reforms are put into place, Nigeria will be able to move past its current problems.

He said that when the order is put into effect, import duties and tariffs will be suspended for basic foods, raw materials, and other direct inputs used in manufacturing. These inputs include fertilizers, seedlings, chemicals, pharmaceuticals, flour, grains, and poultry feed.

In a similar vein, it will allow millers to import paddy rice for a period of six months at no duty or value added tax.

The following items have their import duties and other tariffs suspended for a period of six months: staple foods; raw materials and other direct inputs used in manufacturing; inputs used in agriculture production, such as fertilizers, seedlings, chemicals, pharmaceuticals, flour, and grains; and poultry feeds.

Part of the document states, “Value Added Tax, where applicable, is hereby suspended on the following items for the rest of the year 2024: Basic food items and semi-processed, staple food items such as noodles and raw material inputs for the manufacturing of food items, electricity and public transportation, agricultural inputs and produce, and pharmaceutical products.”

Nigeria’s soaring inflation will subside if import duties are relaxed – CPPE

The Director of the Center for the Promotion of Private Enterprise, Muda Yusuf, responded to the proposal by stating that Nigeria’s rapidly rising inflation will be subdued by the import tariff relaxation included in the ASAP.

According to Muda, the proposal will take care of a lot of the urgent economic problems that real sector investors are concerned about.

He asked Tinubu’s administration to move more quickly to put the plan into action so that Nigeria’s economy could advance.

“The Finance Minister’s suggested Accelerated Stabilization and Advancement Plan is a commendable idea. It tackles a lot of the urgent economic problems that real sector investors are facing.

The real economy’s stakeholders have been calling for strong and comprehensive fiscal policy measures for the past year, and they are included in the plan. It answers investment worries about high import duty regimes, high interest rates, and the expense of cargo clearance at the ports.

“The economy’s raging inflationary pressures, particularly food inflation, would subside with the reduction of import duties on essential raw materials for manufacturers.

The administration’s attention to investors’ worries regarding the actual economy is reflected in the fiscal measures. We demand that the plan be implemented as soon as possible after the president gives his approval,” he stated.

Negotiation on minimum wage

The government’s economic plan, known as ASAP, is being proposed in the midst of a debate over minimum wages that has recently gained traction in Nigeria.

The Nigerian economy was shut down on Monday by organized labor because to the government’s failure to enact a new minimum wage.

But on Tuesday, the workers were able to get the government to promise to pay a minimum wage that was more than N60,000, and as a result, the strike was called off.

A new minimum salary of N494,000 had previously been suggested by the Trade Union Congress and the Nigeria Labour Congress.

It was discovered that talks on a new minimum wage have been reopened by organized labor and the government.

In the meantime, Senator Orji Uzor Kalu suggested a new minimum wage of N75,000 to N90,000 during Tuesday’s plenary.

Paul Alaje, Chief Economist and Partner at SPM, has already stated that N100,000 should be the minimum salary.