Nigerian lawmakers have advised the government to suspend the trade liberalization scheme and common external tariffs of the regional body-ECOWAS.
Senate’s resolution to suspend the ECOWAS trade protocols followed a motion on the abuse of customs tariff and indiscriminate issuance of fiscal policies, and their negative impact on the national economy.
The motion was sponsored by the Chairman of the senate committee on customs, Senator Hope Uzodinma, during Tuesday’s plenary.
The senate also urged the government to review the process of enacting the tariff handbook, in order to identify all abuses and revenue leakages. It also recommended that the senate shall approve all tariff regimes by the government before they can be implemented.
Senator Uzodinma later told Voice of Nigeria that his advocacy was based on the need to protect the country’s national interest, especially now that Nigeria was making efforts to rebuild its economy.
“We entered into these protocols with the hope that the rule of origin, which means that genuine production from member countries is the product that will enjoy zero duty tariff, but they embarked into sharp practices, allowing Malaysian companies to build oil tank farms in Cote’d’Ivoire, Ghana, and Togo, and then doing bulk shipping to these countries and packaging to enter Nigerian border in the name of ECOWAS treaty without paying duty.
“Now these ECOWAS countries will receive duty on bulk cargo delivered to them, get employment for their citizens who will repackage the products, and then remove the products to Nigeria without paying duty and enjoy the benefits of our market free,” Senator Uzodinma explained.
ECOWAS treaty records that, under the provision of the trade liberalization scheme protocol, goods produced in any member state will be imported into any member state at zero percent duty rates. This includes prohibited items provided that such goods have 40% local value addition to satisfy “RULE OF ORIGIN” required.
These protocols of economic integration of the West African region were predicated on free movement of goods and services, as well as strategic economic convergence criteria of member states.
The convergence criteria include establishment of a common external tariff (CET); harmonizing all customs duties across the board for all imports from a third party country.
In line with the resolutions, the senate committee on customs has scheduled a public hearing for the first week of December, 2016 to receive inputs from the public on the current amendment of the customs Act.