Manufacturers Association of Nigeria Criticizes New Expatriate Employment Levy, Raises Concerns Over Economic Impact
The Manufacturers Association of Nigeria (MAN) has voiced its concerns over the adverse effects of the newly introduced Expatriate Employment Levy (EEL) by the Federal Government, citing potential negative repercussions on the manufacturing sector and the broader economy.
According to MAN, the imposition of the EEL contradicts President Bola Tinubu’s Renewed Hope Agenda and his Fiscal Policy and Tax Reform initiative, exacerbating the challenges faced by the manufacturing industry. In 2023 alone, 767 manufacturers ceased operations, and 335 became distressed due to various economic difficulties, including exchange rate volatility and inflation.
In a statement, MAN highlighted that the EEL would increase the cost of doing business, further burdening manufacturers already grappling with multiple challenges. Capacity utilization in the sector has dwindled to 56%, while inventory of unsold finished products has surged to N350 billion, signaling significant economic strain.
Moreover, MAN expressed concerns that the EEL could jeopardize Nigeria's international trade agreements, particularly the African Continental Free Trade Area, by hindering the free movement of skilled labor across the continent. The association warned that retaliatory measures from other countries could ensue, potentially harming Nigeria's regional integration efforts and tarnishing its image internationally.
MAN urged President Tinubu to reconsider the implementation of the EEL, emphasizing the need to prioritize policies that promote economic growth and attract investments.
The introduction of the EEL has sparked criticism from various sectors, including the Lagos Chamber of Commerce and Industry and the Centre for the Promotion of Private Enterprise. Both organizations raised alarm over the potential negative impact on foreign investments, diaspora remittances, and Nigeria's global economic integration efforts.
The opposition to the EEL underscores the complexities surrounding economic policies aimed at balancing the interests of local industries, foreign investors, and workforce development in Nigeria.
