The billing never ends
Nigeria’s new importation taxes could make things super expensive
Good morning, Big Brains. I saw a video of a twenty-something person talking about how Nigeria drags them 7 steps back whenever they take a step forward. The weight of that reality hit me harder as I wrote this edition of the Newsletter.
- Margaret
Word count: ~ 1, 000
Reading time ~ 4 mins
Let’s get into today’s edition:
Nigeria’s new importation taxes could make things super expensive
Nigeria has big plans for its women
The Big Deal
Nigeria’s new importation taxes could make things super expensive
One thing the Tinubu-led administration does best is making sure yesterday’s price is never today’s price. According to the Manufacturers Association of Nigeria (MAN) and the Nigeria Employers’ Consultative Association (NECA), tomorrow’s price is about to go crazy.
Last week, the Nigerian Ports Authority (NPA) raised port charges by 15% to bring Nigerian ports up to international standards. While that sounds cool on paper, MAN is insisting it’s a terrible move that will hike production costs and push inflation through the roof. But that is not even the only problem.
The Nigeria Customs Service (NCS) has also introduced a 4% levy on the value of importation, and NECA is calling it a desperate attempt to meet its ₦10 trillion revenue target in the 2025 budget. According to them, these new charges will squeeze ₦2.84 trillion from private businesses and increase duties paid by industries by 80%.
It’s so bad that former Senate President Bukola Saraki has joined MAN and NECA in saying that the two policies are coming at the wrong time and should be stopped before they cause further damage.
Why is this a big deal?
This will affect everyone, but let’s start with regular people. When you consider that 80% of Nigeria’s traded goods are moved into the country by sea, you’ll get a sense of how much impact these tariffs will have on everyday Nigerians because an increased tariff automatically translates to an increase in the shelf price of the imported goods.
This will sting even harder for manufacturers because most of them rely on imported raw materials. Any increase in port charges will directly raise production costs. If that happens, businesses will either pass the cost on to consumers or take the losses and risk shutting down.
Experts, on the other hand, have also predicted that the NCS's extra 4% levy on imports will increase Nigeria’s inflation rate. If you’ve been reading The Big Daily for a while, you should know that this contradicts President Tinubu’s promise of reducing Nigeria’s inflation rate to 15% (inflation is currently at 34.80% by the way). For the president to achieve this ambitious goal, he would have to stop some of his twin policies – subsidy removal and floating of naira – and that’s not likely to happen anytime soon. When you add the effects of those policies to the possible impact of these importation charges, you’ll realise that Nigeria will remain in the trenches for a while.
Apart from the effect the tariff hike would have on Nigeria’s inflation rate, it could also reduce the country's competitiveness in the global market. Businesses already deal with unreliable electricity, high exchange rates, and transportation difficulties. Adding higher port charges to the mix would make the country even less attractive to local and foreign investors.
In recent years, we’ve already seen multinational companies like Procter & Gamble and GlaxoSmithKline (GSK) Plc exit Nigeria because of how challenging the market has become. About 767 manufacturers have also had to shut down for similar reasons. The list could grow longer if the cost of doing business here continues to increase.
For the federal government, extra charges mean more money, and that would be something to be excited about if Nigeria didn’t have such a long history of mismanagement of public funds.
This is the part where we all sigh, say “God abeg” and hope for the best.
Nigeria has big plans for its women
The Nigerian government is back with another promise to empower Nigerian women, and thankfully, this time, it has nothing to do with goats.
The grand plan is to empower 10 million women economically by 2027 because, apparently, that’s the push Nigeria needs to build a $1 trillion economy.
Announcing the empowerment scheme on Sunday, February 10, the Minister of Women Affairs, Imaan Sulaiman-Ibrahim, said the plan is to equip women with financial literacy training, business development skills, and cooperative structures so they can build businesses and boost economic growth.
To bring the plan to life, the ministry has teamed up with WEMA Bank for the MOWA-SARA Accelerated Skills Acquisition Programme, where 500,000 women will be trained in vocational skills, business entrepreneurship, and financial inclusion.
She also confirmed that the World Bank-backed Nigeria for Women Scale-Up Project has kicked off and intends to reach 4.5 million female beneficiaries across Nigeria. The first stop is Kano, where 2,500 women are currently being trained in business and hospitality skills.
We love to see it and all of that, but it’s important for the real-life results to look just as good as the numbers the federal government is targeting. Not to sound like that guy, but President Tinubu’s administration doesn’t have the best track record of keeping its promise to women. His campaign promise to reserve at least 35% of seats in his cabinet for women, for instance, has not seen any headway, even though he started at 18.75% in 2023. In fact, the number, which should have been higher by now, following his cabinet reshuffle in October 2024, has sunk even lower to 16.7%. The current target to empower 10 million women by 2027 is cute and all; we hope to see a real-life impact.
This Week’s Big Question
What do you think about Nigeria possibly getting 31 new states?
Maria’s response - “I think 67 states won’t cut it. We need at least 100 states, 7 presidents and 1,000 new ministers. Why stop at just 31 new states?”
You can also share your response here, and if it’s as interesting as Maria’s, we’ll feature it in the next edition.
The Big Picks
Sharia Panels In South-West Good For Sustainable Peace: The Secretary-General of the Nigerian Supreme Council for Islamic Affairs (NSCIA), Prof. Is-haq Oloyede, has called on South-West leaders to support setting up Sharia panels in all six states in the region.
800 Ex-Boko Haram Fighters Undergoing Deradicalisation – DHQ: The Defence Headquarters (DHQ) announced on Monday that 800 former Boko Haram fighters who surrendered to the military are currently undergoing rehabilitation before being reintegrated into society.