The director-general of the Manufacturers Association of Nigeria (MAN), Segun Ajayi-Kadir, has urged the federal government to discontinue issuing import licenses for refined petroleum products. Instead, he recommends that the government focus on incentivizing local refining. This call was made during a press conference ahead of MAN's 54th Annual General Meeting, where Ajayi-Kadir discussed the patronage of Made-in-Nigeria products and the state of local refining.
Ajayi-Kadir noted that the government's policy framework for mandatory patronage of Made-in-Nigeria goods is being developed in line with the President's directive. The directive prioritizes products that can be sourced locally. However, the continued importation of refined petroleum products despite local refining capacity undermines this policy. Ajayi-Kadir emphasized that it is economically indefensible for a crude oil-producing nation like Nigeria to depend on imports for refined products.
The MAN DG pointed out that the presence of Dangote Refinery has helped mitigate the current fuel price situation. He suggested that without Dangote Refinery, fuel prices could have been much higher, potentially reaching N2,500. Ajayi-Kadir proposed that the government engage with local refiners, including Dangote and three to four others, and consider subsidizing the price of crude oil sold to them. This approach would involve agreements to moderate domestic pump prices.
Ajayi-Kadir stressed that importation of refined products should be completely discouraged. He argued that it is only a non-serious country that would have huge crude oil resources and still allow itself to import refined products. This, he said, effectively exports the jobs that the sector creates and leaves poverty with its people. The MAN DG emphasized the need for the government to support local refiners to boost the economy.
The government's continued issuance of import licenses for refined petroleum products has been criticized by Ajayi-Kadir. He noted that this practice undermines the local refining industry and the government's policy framework for patronage of Made-in-Nigeria goods. Ajayi-Kadir urged the government to reconsider its approach and prioritize local refining.
Dangote Refinery has been cited as an example of the potential of local refining in Nigeria. The refinery has helped reduce the country's dependence on imported refined products. Ajayi-Kadir's proposal to engage with local refiners and subsidize crude oil prices aims to encourage more investment in the sector. This approach could lead to increased production and reduced fuel prices.
The Manufacturers Association of Nigeria (MAN) will hold its 54th Annual General Meeting, where the issue of patronage of Made-in-Nigeria products and the state of local refining will be discussed. The association's director-general, Segun Ajayi-Kadir, has emphasized the need for the government to support local industries and prioritize Made-in-Nigeria products.
Key points
- The government should discontinue issuing import licenses for refined petroleum products and focus on incentivizing local refining.
- The presence of Dangote Refinery has helped mitigate the current fuel price situation in Nigeria.
- The government should engage with local refiners and consider subsidizing crude oil prices to encourage more investment in the sector.
