NECA Supports 15% Fuel Tariff to Boost Local Production

The Nigeria Employers’ Consultative Association (NECA) has expressed strong support for the Federal Government’s approval of a 15 percent import tariff on petroleum products, describing the policy as a crucial step toward reviving local refining capacity, stimulating domestic production, and reducing Nigeria’s heavy dependence on imported fuel.

“We support the policy of a 15% tariff on imported petroleum products — not on locally produced ones. If the 15% tariff is the ‘punishment’ we must bear collectively for allowing our four refineries to collapse, then so be it,” Oyerinde said.

He further noted that protectionist measures are a standard economic practice globally, with even developed nations like the United States adopting similar strategies to protect domestic industries.

• African Public Relations Association

• US And EU Ban TikTok From Staff Mobile Devices

“Even developed nations like the U.S. are introducing protectionist policies to protect their local industries. We don’t have much excuse not to do the same,” he said, highlighting the need for Nigeria to adopt policies that prioritize local production.

The Federal Government, through a presidential directive, instructed the Federal Inland Revenue Service (FIRS) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to enforce the 15% tariff on imported petroleum products. While the move has faced criticism from some quarters who argue it may increase landing costs and push up fuel prices at the pump, NECA insists the policy is a necessary intervention for the country’s industrial and economic growth.

Oyerinde emphasized that the policy could serve as a model for other sectors of the economy, particularly the manufacturing and real sectors, where import dependence remains high.

“To ramp up production in the manufacturing and real sectors, this kind of policy should extend there too. Why do we import what we can produce locally? It affects foreign exchange reserves and has far-reaching consequences for the economy,” he said.

The NECA chief also suggested a one- or two-year grace period for businesses to adjust and integrate backward into local production before import duties are fully applied.

“We’ve said that everything we can produce locally should attract import duties — provided we have made sufficient arrangements for local production to meet our needs. If we have to give businesses a short moratorium to integrate backward, then fine — but let’s reduce the tendency to import,” Oyerinde added.

The tariff, according to NECA, is part of a broader strategy to stimulate domestic production, attract investment into local refineries, and strengthen Nigeria’s industrial base. By reducing overreliance on imported fuel, the policy is also expected to help conserve foreign exchange and promote economic stability.

Industry analysts have noted that the move signals the Federal Government’s growing focus on boosting local industries and protecting domestic production, even amid global economic challenges and rising fuel demand. NECA believes that if properly implemented, the 15% tariff could serve as a blueprint for similar measures across other sectors, driving growth, creating jobs, and fostering sustainable development.

As Nigeria continues to grapple with chronic fuel importation and the associated economic burden, NECA’s backing of the import duty sends a strong message to investors and local manufacturers about the government’s commitment to supporting homegrown industries while encouraging self-sufficiency in critical sectors.