Nigeria’s manufacturing sector is opposing the recent reintroduction of a 4% Free on Board (FOB) fee by the Nigeria Customs Service (NCS). The fee, which was suspended in February 2025, was reimposed on August 4, 2025. The Manufacturers Association of Nigeria (MAN) has expressed concerns over the move, citing the potential increase in the cost of importing raw materials, machinery, and spare parts.
According to Segun Ajayi-Kadri, Director General of MAN, the reintroduction of the FOB fee contradicts the government’s earlier suspension of the charge. He noted that the decision would significantly increase the cost of goods and services in the country, as manufacturers would have to bear the additional expense. The fee, Ajayi-Kadri argued, would also encourage informal cross-border sourcing, lead to cargo diversion, and promote under-declaration.
In comparison to other West African countries, such as Ghana, Côte d’Ivoire, and Senegal, Nigeria’s FOB fee is considerably higher. In these countries, targeted inspection or collection fees are typically within a 0.5% to 1% FOB range, with higher levies only applied to luxury or nonessential imports. The NCS’s unilateral imposition of a uniform 4% FOB levy has raised concerns among manufacturers, who fear it would raise the cost of doing business in the country.
The MAN has urged the government to suspend the FOB fee until December 31, 2025, to allow for an impact assessment and consultation with stakeholders. This move is seen as essential to mitigate the potential negative effects of the fee on the manufacturing sector. The suspension of the FOB fee in February 2025 was announced by the NCS following outcry from manufacturers. The recent reintroduction of the fee has sparked renewed opposition from the sector, highlighting the need for a comprehensive review of the charge and its implications for Nigeria’s economy.
The development has significant implications for Nigeria’s trade policy and its efforts to promote economic growth. The government’s decision to reimpose the FOB fee has sparked concerns among manufacturers, who are already facing numerous challenges in the country. As the sector continues to navigate these challenges, the government’s policies will be closely watched to determine their impact on the economy.
