FG Extends FTZ Licence Validity By Five Years As Investments Hit $20bn

Speaking at a stakeholders forum organised by the Nigeria Economic Zones Association in Lagos themed: “Streamlining Free Zone Operations for Global Competitiveness”, Adebayo recalled that the ministry had in 2020 temporarily suspended the issuance of new free trade zone licences, due to the need to overhaul the system.

According to the minister, yearly returns must be made by the operators following the directive on the licence validity extension.

Adebayo urged the Nigeria Export Processing Zones Authority and the Oil and Gas Free Zones Authority to fully digitalise its operations before the end of the year,

A statement credited to the Head, Corporate Communications, NEPZA, Martins Odeh quoted the minister as saying, “Globally, free trade zones plays a critical role in stimulating industrial activities, boosting the manufacturing sector and growing the economy.

“Their performance impacts three main areas of job creation, diversifying government revenue and generating foreign exchange as a well functional free trade zone in Nigeria can create 300,000 direct jobs.

“Expanding Nigeria’s export capacity needs under the Africa Continental Free Trade Area mitigates the risk of Nigeria becoming a dumping ground for imports while also boosting our foreign currency reserves.”

Adebayo stressed that is necessary to adopt strategies that would transform the export capacities into a dynamic instrument for economic growth.

In the report, Adebayo also estimated cumulative investments in the 30 years of operations of the free zone scheme in Nigeria at $20bn.

The minister who spoke on Friday at the official commissioning of the Nigeria Economic Processing Zones Authority Lagos office said that with the generous fiscal incentives associated with the free zone, the scheme remained a veritable source of economic development.

He said that the free zone, in 2021, generated N250bn in both Foreign and Local Direct Investments; N35bn in Customs duty payments and N65bn in local import/backward linkage.

The minister said that the scheme generated N500m in Pay as You Earn, 25,000 in new employment and 5,000 transfer of skills.

“The Free Zone Scheme is one of the prime initiatives of the Federal Government, for diversification of Nigeria’s economic base, to achieve our vision of growing the economy, creating jobs and generating wealth.

“I urge you not to relent in giving it your best in your service to promote the economic development of our great country, Nigeria,” he said.

On his part, the Managing Director, NEPZA, Prof. Adesoji Adesugba, said that the choice of Lagos as its liaison office was based on purely economic considerations.

This, he said, was because 80 per cent of the special economic zones were located in Lagos and within 100km of its radius.

“Accordingly, this is our way of bringing NEPZA closer to our investors for sustained customer service, to continually attract and retain investors,” Adesugba said.