Nigeria bans importation of refined sugar, derivatives from Free Trade Zones protecting sugar master plan

NIGERIA – The Federal Government has prohibited the importation of refined sugar and its derivatives from the nation’s Free Trade Zones (FTZs) into the Nigerian Customs Territory.

According to reports by This Day, the move is aimed to protect the sugar industry, which is governed by the Nigerian Sugar Master Plan (NSMP).

The NSMP provides a framework for motivating investment in the local production of refined sugar by securing the Nigerian Sugar market for investors in the Backward Integration Program (BIP).

It does this by providing import sugar allocations for raw sugar to recognised investors based on the performance on the BIP and guided recognition of their installed refining capacity.

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NSMP’s main objectives are to raise local production of sugar to enable the country attain self-sufficiency; stem the tide of unbridled importation; create huge number of job opportunities and to contribute to the production of ethanol and generation of electricity.

With the provision of enterprises in the FTZs to export 100% of their output to the Nigerian Customs Territory, the government has termed it as a real potential threat to the goals of NSMP.

“In order to protect our national interest and ensure the returns in the Federal Government’s investment in the NSMP are realised, importation of refined sugar and all other sugar derivatives from the Free Trade Zones into the Nigerian Customs Territory are here prohibited.”

Nigerian Ports Authority

To this end the Ministry of Industry, Trade and Investment has issued a ban directive conveyed in a letter by the Nigerian Ports Authority (NPA), Lagos Port Complex, Apapa, Lagos.

“It has recently come to our notice that due to the recent location of a Sugar Refinery in a Free Trade Zone, refined sugar is being imported into the Nigerian Customs Territory under the concession granted to enterprises in the Free Trade Zones to export 100% of their output to the Nigerian Customs Territory, and this is real potential threat to the goals of the Nigerian Sugar Master Plan (NSMP),” NPA said.

“In order to protect our national interest and ensure the returns in the Federal Government’s investment in the NSMP are realised, and in line with extant laws and regulations of the Federal Government of Nigeria, importation of refined sugar and all other sugar derivatives from the Free Trade Zones into the Nigerian Customs Territory are here prohibited by the Honourable Minister, Ministry of Industry, Trade and Investment,” the NPA letter stated.

A Free Trade Zone is a category of the special economic zone in Nigeria. It is areas where goods may be landed, manufactured, handled, stored, or perhaps reconfigured and re-exported under specific customs regulation. The goods processed from the zones are not subject to customs duty, indicates Mondaq.

The recent move by the government comes days after the Central Bank of Nigeria hinted of plans to halt foreign currency for sugar and wheat imports, as the country tries to conserve national foreign reserves.

In 2015, the bank listed 41 items that had been placed on its FX restriction list, citing that the move was necessary to conserve the nation’s foreign reserve and boost local production of the items on the restriction list.

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The list has been growing ever since and some of the food items on it are margarine, poultry and eggs, rice, maize and dairy products.

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