•Says expatriate employment levy will smash traders’ confidence Tinubu is striving arduous to construct
Dike Onwuamaeze
As controversy trails the newly launched Expatriate Employment Levy (EEL) of $10,000 and $15,000 for employees and administrators, respectively, the Producers Affiliation of Nigeria (MAN) has revealed that 335 manufacturing corporations grew to become distressed whereas 767 shut down in 2023.
MAN warned that the EEL will surely smash the arrogance President Bola Ahmed Tinubu was striving to construct amongst home and international traders.
The views had been contained in a press release issued yesterday by Director-Normal of MAN, Mr. Segun Ajayi-Kadir, titled, “MAN Expresses Grave Considerations over the Expatriate Employment Levy.”
It described the most recent levy as “punitive levy,” which was already “being perceived as a punishment imposed on traders for daring to spend money on Nigeria and on indigenous corporations for using wanted international nationals”.
The assertion mentioned EEL “is doubtlessly an albatross to the realisation of Mr. President’s non-public sector led financial system aspirations and will surely smash the belief and confidence he’s striving arduous to construct amongst home and international non-public traders”.
Ajayi-Kadir added, “The imposition of EEL poses potential influence on the manufacturing sector and the financial system at giant.
“This can in flip mark an unwarranted and unprecedented addition to the price of doing enterprise in Nigeria, particularly to producers.
“The coverage will certainly undermine the administration’s willpower to place Nigeria as a lovely international funding vacation spot and should engender a chilly welcome in Mr. President’s future international funding promotions endeavours, in addition to undermine Nigeria’s efforts at changing into a hub for shared providers centre and enterprise course of outsourcing.”
Based on the assertion, “The manufacturing sector is already beset with multidimensional challenges. In 12 months 2023, 335 manufacturing corporations grew to become distressed and 767 shut down.
“The capability utilisation within the sector has declined to 56 per cent; rate of interest is successfully above 30 per cent; international trade to import uncooked supplies and manufacturing machine stock of unsold completed merchandise has elevated to N350 billion and the actual progress dropped to 2.4 per cent.
“Expatriates in Nigeria presently pay greater than $2000 for CERPAC. The sector can’t afford one other disincentive to elevated funding and portfolio enlargement.”
MAN acknowledged that the levy would deter multinational corporations from investing in Nigeria and organising their regional headquarters within the nation.
“Additionally, the levy will make Nigeria a costlier location for international experience that worldwide corporations require for his or her operations,” it acknowledged.
“Total, we danger slowing down information and expertise switch to Nigerians and undermining a key avenue for the nation to maneuver up the expertise ladder,” MAN added.
The producers’ affiliation was equally fearful that the imposition of such a levy, which might have far-reaching implications for the nation’s financial system and doubtlessly exert strain on Nigeria’s forex, was launched by means of a handbook, somewhat than a legislation enacted by the Nationwide Meeting.
MAN warned, “This levy might expose the federal authorities to a plethora of lawsuits that can distract authorities from the duty of salvaging the present dire scenario of our financial system.
“Moreover, we have already got legal guidelines that had been promulgated to realize the precise objective for which the EEL was launched. They embody the Native Content material Act, which ensures the roles of Nigerians, and the Immigration Act, which prescribes the primacy of consideration for Nigerians and imposes acceptable quota within the engagement of expatriate.
“Subsequently, the EEL would quantity to duplication and burdensome addition.”
MAN additionally expressed concern that EEL would contradict Nigeria’s worldwide commerce agreements and the obligations contained therein.
It acknowledged, “For example, Nigeria is a signatory to the African Continental Free Commerce Space (AfCFTA) settlement. One of many pillars of the AfCFTA is the free motion of expert labour throughout the continent, which is complemented by non-discriminatory measures towards fellow Africans.
“Fairly importantly, this might set off retaliatory measures towards Nigerians working throughout Africa and different nations of the world; frustrate regional integration efforts and painting Nigeria as a spoiler amongst her friends.”
The affiliation, subsequently, requested the president to provide due consideration to its arguments and direct that the implementation of EEL be discontinued.
Based on MAN, discontinuing the coverage could be within the total curiosity of the nation’s financial system and is urgently wanted to reassure home and international traders of Nigeria’s dedication to an funding pleasant surroundings and ease of doing enterprise.
“Moreover, Mr. President ought to direct the Nigeria Immigration Service to chorus from imposing compliance with the coverage,” MAN mentioned.
Ajayi-Kadir acknowledged that whereas MAN totally supported insurance policies aimed toward selling high quality job alternatives for Nigerians, it will urge the president to think about the broader detrimental impact of EEL.
He acknowledged, “A more practical and sustainable method is for presidency to deliberately enhance on its human capital improvement and incentivise corporations to spend money on creating native expertise with out compromising Nigeria’s capacity to draw International Direct Funding (FDI).
“MAN advises that this can be very necessary that authorities institutionalise stakeholders’ consultations and engagement earlier than necessary insurance policies that would have far-reaching implications for our financial system are made.
“This can enable for constructive enter from the enterprise group, who’re capable of help authorities initiatives and are essentially the most impacted by the outcomes.”
