Following the suspension of the 15 per cent import duty on petroleum product, the Centre for the Promotion of Private Enterprise (CPPE) has called on the federal government to avoid short-term measures that would jeopardise the country’s long-term national interest.
The CPPE has also called for its reinstatement saying it is essential to restoring competitive balance and safeguarding domestic refining investments.
It stated the Dangote Refinery and other emerging modular refineries in the country are transformative national assets that are worthy of protection because they are well aligned with Nigeria’s long-term economic and strategic goals.
These views were expressed on Sunday, by the Founder/Chief Executive Officer of CPPE, Dr. Muda Yusuf, in a policy brief titled “Safeguarding Nigeria’s Domestic Refining Capacity and Energy Security: Policy Imperatives Following the Suspension of the 15% Import Duty on Petroleum Products,” in which he warned that “without protective measures, domestic refiners will be operating at a structural disadvantage.”
Yusuf said: “Nigeria must avoid short-term measures that jeopardise long-term national interests.
“The suspension of the 15 per cent import duty puts at risk Nigeria’s energy security, industrialisation, foreign exchange stability job creation, backward integration and national economic sovereignty.”
He added that “protecting domestic refining capacity is an urgent national imperative.
“Reinstating protective measures, supporting local refiners, ensuring policy predictability, and regulating import volumes are essential steps toward securing Nigeria’s industrial future.
“The Dangote Refinery and emerging modular refineries are transformative national assets.
“Safeguarding them aligns squarely with Nigeria’s long-term economic and strategic goals.”
According to the CPPE, Nigeria is at a decisive moment in its efforts to secure energy independence, deepen industrialisation, and reduce vulnerability to external shocks.
Therefore, “the federal government’s suspension of the 15 per cent import duty on petrol and diesel carries profound implications for domestic refining, investment confidence, macroeconomic stability, and the long-term competitiveness of the petroleum downstream sector,” CPPE said in the brief that evaluated the economic and strategic consequences of the suspension.
The brief also outlined policy options that could balance immediate consumer concerns with Nigeria’s long-term national interest.
According to Yusuf, the 15 per cent import duty served as an industrial protection instrument designed to support emerging private refineries, promote backward integration and industrial development, ensure a level playing field for domestic producers and encourage long-term investments in refining and petrochemicals, etc.
He averred that investors like the Dangote Refinery and modular refinery operators made multi-billion-dollar commitments based on policy stability and the assurance of an environment that rewards local production.
He argued that “suspending the duty undermines this protective framework and exposes domestic refiners to inequitable competition from importers benefiting from vastly superior international conditions.”
Yusuf noted that operators of domestic refineries deserved protective measures such as the 15 per cent duty on imported petroleum products because they are operating within a high-cost environment shaped by expensive energy and self-generation, infrastructure gaps and logistics bottlenecks, high cost of capital, security-related risks and inefficiencies in ports and transport systems.
“These structural disadvantages make parity with imported products impossible without protective measures,” he asserted.
The CPPE also warned that “reverting to heavy import dependence reopens vulnerabilities to global price volatility, geopolitical disruptions, and supply insecurity, which were the same conditions that previously collapsed public refineries and created a fiscally ruinous subsidy regime.
The CPPE also identified petroleum importation as one of Nigeria’s largest consumers of foreign exchange, which could heighten pressure on the Naira and fuel inflation through exchange-rate pass-through as well as deepening balance-of-payments deficits and undermining macroeconomic stability.
According to Yusuf, domestic refining stimulates broad value-chain activities in petrochemicals, plastics, logistics and transport, engineering services, fabrication and construction.
He said: “Unrestrained importation effectively exports these jobs and opportunities to foreign economies.
He also warned that frequent policy reversals would weaken investors’ sentiment across the refining and downstream operations, domestic manufacturing, financial institutions and global investment partners
“Undermining confidence at this stage threatens the viability of transformational national assets such as the Dangote Refinery and modular refineries,” he said.
Yusuf also canvassed the inclusion of domestic refining in the list of beneficiaries of import adjustment tax that players in strategic sectors such as agro allied, cement, sugar, steel, pharmaceuticals, and automobiles have been enjoying.
Dike Onwuamaeze
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