Nigerian government suspends tariffs and import duties on staple foods, medicines and other products

The Nigerian government has unveiled a plan to reduce inflation in the country through the suspension of customs duties and import tariffs on food items, manufacturing raw materials, medicines and inputs for agricultural production, as well as other fiscal measures.

This was announced by Finance Minister Wale Edun recently in a presentation of the proposed Accelerated Stabilisation and Advancement Plan (ASAP).

Edun explained that the plan recently presented to President Bola Ahmed Tinubu is aimed at ending Nigeria’s economic distress.

This comes as overall inflation in Nigeria has risen to 33.69 percent and food inflation to 40.53 percent.

Inflation is causing unbearable hardship for Nigerians as rising prices continue to erode their purchasing power while prices remain unchanged.

As a solution, Edun explained that the fiscal measures, if implemented, would bail Nigeria out.

He said the order, when implemented, will entail suspension of import duties and tariffs on staple foodstuffs, raw materials and other direct inputs, as well as agricultural production, including fertilizers, seedlings, chemicals, pharmaceutical products, poultry feed, flour and grains.

Similarly, millers will be allowed to import paddy rice duty-free and VAT-free for six months.

“Import duties and other customs duties on the following goods are hereby suspended for six months: staple foodstuffs, raw materials and other direct inputs of production, inputs for agriculture, including
Fertilizers, seedlings, chemicals, pharmaceutical products, poultry feed, flour and grains.

“VAT, where applicable, is hereby suspended for the remainder of 2024 on the following items: staple and semi-processed staple foods such as pasta and raw materials for the manufacture
of food, electricity and public
“Transport, agricultural inputs and products, and pharmaceutical products,” the document states.

Easing import duties will calm rampant inflation in Nigeria – CPPE

Responding to the proposal, Muda Yusuf, director of the Centre for the Promotion of
Private companies said the easing of import duties envisaged in the ASAP would calm Nigeria’s rampant inflation.

Muda noted that the plan will address many of the burning economic issues that concern investors in the real sector.

He urged Tinubu’s government to speed up the implementation of the plan to boost Nigeria’s economy.

“The proposed accelerated stabilisation and development plan is a laudable proposal by the Minister of Finance. It addresses many of the burning economic issues that concern investors in the real sector.

“The plan contains robust and comprehensive fiscal measures that real economy actors have been calling for over the past year. It addresses investor concerns about high interest rates, high cargo handling costs at ports and high import tariffs.

“Easing import tariffs on raw materials essential to manufacturers would calm raging inflationary pressures in the economy, particularly food inflation.

“The fiscal measures reflect the government’s responsiveness to investors’ concerns in the real economy. We call for a speedy implementation of the plan once it is approved by the President,” he said.

Minimum wage negotiations

The government’s economic plan, known as ASAP, comes amid discussions on a new minimum wage that has taken center stage in Nigeria recently.

On Monday, the Nigerian trade unions brought the Nigerian economy to a standstill because the government failed to introduce a new minimum wage.

However, the strike was suspended on Tuesday after workers received a commitment from the government to pay a minimum wage of over 60,000 naira.

Previously, the Nigeria Labour Congress and the Trade Union Congress had proposed a new minimum wage of 494,000 naira.

It was announced that the government and the unions have resumed negotiations on the new minimum wage.

Meanwhile, Senator Orji Uzor Kalu proposed a new minimum wage of between 75,000 and 90,000 naira during the plenary session on Tuesday.

Earlier, Paul Alaje, Chief Economist and Partner at SPM, said the minimum wage should be at least N100,000.