Senate Passes Landmark Law Mandating 30% Local Processing of Raw Materials Before Export
Sunday Aborisade in Abuja
In a decisive move aimed at spurring industrialisation and boosting local manufacturing, the Senate has passed a bill requiring that all raw materials intended for export must undergo at least 30 percent local processing.
The bill, which amends the Raw Materials Research and Development Council Act of 2022, was passed following the adoption of a report by the Senate Committee on Science and Technology.
Sponsored by Senator OnyekachiNwebonyi (Ebonyi North), the legislation seeks to curb the export of unprocessed raw materials, promote value addition, and stimulate economic growth through increased local content.
Under the new law, exporters who fail to meet the 30 percent processing threshold will face a 15 percent levy on the export value of the goods and may have their raw material value addition certificates suspended or revoked.
In more severe cases, such exports will be treated as smuggled goods and penalised accordingly under existing customs and trade laws.
The bill assigns the Raw Materials Research and Development Council the responsibility of developing clear benchmarks and guidelines to define what qualifies as 30 percent processing.
This includes consideration of the nature of each material, applied technologies, and compliance with global market standards on quality, safety, and environmental sustainability.
Senate President GodswillAkpabio, speaking during plenary on Wednesday, described the bill as a “major step toward industrialisation.”
He added that it would reduce the nation’s dependence on imports and unlock new opportunities for domestic industries.
He said, “It will promote sustainable resource management and environmental protection through the adoption of best practices in the utilisation of locally sourced raw materials.
“This legislation is crucial to reducing carbon footprints and supporting the integration of advanced processing technologies in local industries to boost efficiency and product quality.”
The new law is expected to enhance Nigeria’s trade competitiveness, encourage foreign and domestic investment in local processing infrastructure, and create jobs across various sectors of the economy.
By reducing the export of raw, unprocessed materials, the Senate hopes to increase the value of Nigeria’s exports and better position the country in global value chains.
Analysts have long argued that Nigeria’s heavy reliance on exporting raw commodities has stifled the growth of local industries and left the economy vulnerable to external shocks.
This new policy framework, if well implemented, could mark a significant turning point in the country’s industrial development strategy.
