The Centre for the Promotion of Private Enterprise (CPPE) has raised strong objections to the proposed Raw Materials Research and Development Council (RMRDC) Bill, cautioning that it could severely disrupt Nigeria’s fragile export economy and burden manufacturers already grappling with high operating costs.
The bill, now before the National Assembly, mandates that all primary product exports include a minimum of 30% local value addition and restricts manufacturers from importing raw materials considered locally available in sufficient quantity.
In a statement dated April 21, CPPE Director and CEO Dr. Muda Yusuf described the bill as well-intentioned but dangerously simplistic, warning it overlooks the complex industrial and economic realities of Nigeria.
“The bill would penalize exporters—many of whom rely on primary products—and place thousands of jobs at risk in the non-oil export value chain,” Yusuf said.
Crude Reality: Local Capacity Still Lagging
Yusuf emphasized that Nigeria’s dependence on raw product exports remains high. Even crude oil, which dominates national exports, has only recently begun to see local refining capacity.
“Until very recently, domestic refining was non-existent. Crude oil still forms a major part of our exports. Imposing value-addition thresholds without addressing underlying issues is counterproductive.”
Key Provisions Spark Concern
According to CPPE, the bill proposes two major restrictions:
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A ban on the export of primary products that do not meet the 30% local value-addition threshold.
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A prohibition on importing raw materials that authorities deem “sufficiently available” locally.
While acknowledging the value of industrialization and backward integration, CPPE argues that the bill lacks balance, clarity, and feasibility.
“Policies must protect both exporters and processors. Without a data-driven and nuanced approach, this bill threatens to do more harm than good,” Yusuf stated.
Impact on Jobs and Key Exports
CPPE warned that if passed, the legislation could jeopardize thousands of jobs in sectors reliant on non-oil exports, such as cocoa, cashew, gum Arabic, sesame, shea butter, and ginger.
The organization further criticized the bill’s vague implementation strategy, questioning who would approve exports, define value addition metrics, or determine which raw materials qualify as locally sufficient.
“What assessments have been made of local processing capacity? What is the timeline for enforcement? The bill lacks operational detail,” CPPE queried.
Root Causes Ignored, Says Yusuf
Yusuf stressed that the real challenges facing manufacturers—including poor infrastructure, high energy and financing costs, bureaucratic delays, and over-taxation—are not addressed in the bill.
“Many agro-processors have collapsed not due to raw material scarcity, but because of Nigeria’s high production costs and low competitiveness,” he explained.
Warning of Bureaucratic Bottlenecks and Corruption
Beyond economic risks, CPPE warned that the bill could create new layers of bureaucracy and corruption, as businesses would need to navigate additional approval processes.
“This could become another gateway for rent-seeking and delay, choking the ease of doing business,” Yusuf added.
Legal Overreach and Policy Misalignment
CPPE also challenged the legal authority of the RMRDC and the Ministry of Science and Technology to legislate trade policy, noting that export and import regulations fall under the domain of the Ministries of Finance, Industry, Trade, and National Planning, in collaboration with the Nigeria Export Promotion Council (NEPC).
“This bill represents a jurisdictional overstep. Trade policy is a fiscal tool, not a legislative one—it needs flexibility and evidence-based adjustment, not rigid mandates,” the statement read.
Call for Withdrawal and Refocus
In conclusion, CPPE urged the National Assembly to discontinue the bill’s deliberations and advised the RMRDC to return to its primary mandate—supporting manufacturers through raw material research and development.
“The bill’s current direction is misguided. Instead of regulating trade flows, RMRDC should help manufacturers identify cost-effective raw material options. This approach offers far greater value than unnecessary policy overreach.”
According to CPPE, the bill not only lacks a strong value proposition, but also risks undermining the very sectors it intends to support—jeopardizing Nigeria’s non-oil export growth and stifling industrial productivity.
