What's Happening?
The Manufacturers Association of Nigeria (MAN) has expressed opposition to the Nigeria Customs Service's reintroduction of a four percent Free on Board (FOB) charge, effective August 4. The charge contradicts the government's previous suspension and is expected to increase the cost of importing raw materials and machinery. MAN's Director-General, Segun Ajayi-Kadri, highlighted concerns that the charge would raise business costs, encourage informal cross-border sourcing, and lead to cargo diversion.
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Why It's Important?
The reintroduction of the FOB charge poses significant challenges for Nigerian manufacturers, potentially increasing production costs and affecting competitiveness. The charge may lead to higher prices for consumers and impact the overall economy. MAN's call for a suspension and consultation with stakeholders reflects the need for balanced policies that support industrial growth while ensuring efficient customs operations. The situation underscores the importance of government-industry collaboration to address economic challenges.
What's Next?
MAN has urged the Federal Government and Nigeria Customs Service to halt the implementation of the charge and extend the timeline to December 31 for impact assessment and stakeholder consultation. This extension would align with new tax laws set to take effect in January 2026, allowing for discussions on business-friendly guidelines. The outcome of these consultations could influence future customs policies and industrial competitiveness in Nigeria.
