Northern Manufacturers Endorse 15% Tariff on Imported Fuel

Manufacturers in Northern Nigeria have expressed strong support for the Federal Government’s recently introduced 15 percent tariff on imported fuel, describing the move as a strategic step toward promoting local refining capacity, industrial self-sufficiency, and economic stability. The manufacturers said the policy would encourage investment in Nigeria’s refining industry, reduce foreign exchange pressure, and position the country to benefit from its growing oil and gas sector.

The endorsement came after several industry groups and economists weighed in on the implications of the new tariff policy, which President Bola Ahmed Tinubu’s administration introduced as part of a broader effort to strengthen domestic production. The Northern Manufacturers Association (NMA) and members of the Manufacturers Association of Nigeria (MAN) Northern Chapter said that although the tariff might temporarily increase fuel costs, it was a necessary step to achieve long-term economic independence.

In a joint statement issued in Kaduna on Monday, NMA Chairman, Alhaji Musa Ibrahim, commended the policy as a bold and forward-looking decision aimed at revitalizing the nation’s industrial sector. “We fully support the Federal Government’s decision to impose a 15 percent tariff on imported petroleum products. It is a necessary measure that will protect local refineries and stimulate industrial productivity,” he said.

Ibrahim explained that the country’s overreliance on imported fuel had drained foreign reserves, limited industrial competitiveness, and made the economy vulnerable to global oil price fluctuations. He argued that the tariff would create a level playing field for local refineries, particularly the Dangote Refinery, which recently began full-scale production with an expanded capacity exceeding one million barrels per day.

“By imposing this tariff, the government is signalling its commitment to encourage domestic production. When local refineries thrive, industries will benefit from stable energy supply and reduced logistics costs. This is how industrial nations are built,” Ibrahim stated.

The NMA chief added that the new tariff regime would help address unemployment by stimulating local manufacturing and supply chain expansion. He noted that northern industries, particularly those in agro-processing, textiles, and construction materials, depend heavily on energy availability, which has been constrained by Nigeria’s fuel import dependence.

Echoing similar sentiments, Dr. Ahmed Bello, a member of MAN’s economic committee, said that while Nigerians may initially feel some pain due to rising pump prices, the long-term benefits far outweigh the short-term costs. “Economic reforms are never painless, but this policy will attract investors to the refining and petrochemical sector. Once more local refineries come on stream, fuel prices will stabilize naturally,” Bello said.

He also called for effective monitoring and transparency in implementing the tariff, urging the government to ensure that the additional revenue generated is reinvested in local refineries, infrastructure, and industrial power projects. “The essence of this tariff is to reduce import dependence, not to increase government revenue alone. We must ensure that the proceeds support the energy and manufacturing sectors,” he emphasized.

The northern manufacturers also appealed to the Federal Government to provide targeted incentives and subsidies for industries during the transition period. According to them, cushioning measures such as tax reliefs, energy efficiency programs, and improved access to credit would help manufacturers adjust to the policy’s impact.

The policy has sparked diverse reactions across the country. While many industrialists and economists have applauded the initiative, some consumer groups and labour unions have criticized it, warning that it could worsen inflation and increase the cost of living. However, NMA leaders dismissed those fears, saying that sustaining local production was the only viable path to economic recovery and long-term price stability.

“The reality is that Nigeria cannot continue to import fuel at the expense of its industrial development. We must think beyond short-term discomfort and embrace policies that strengthen our productive capacity,” Ibrahim said.

Energy analysts have also noted that the tariff aligns with global best practices. Professor Emmanuel Ogbonna, an energy economist at the University of Jos, explained that countries with large domestic refining capabilities typically use tariffs and fiscal policies to protect local industries. “Tariffs are not punitive; they are protective. Nigeria is simply doing what other oil-producing nations have done to grow their downstream sector,” he said.

He added that as the Dangote Refinery and other modular refineries scale up production, the new tariff would help discourage fuel smuggling and stabilize supply across the country. “Once domestic refining meets local demand, prices will gradually normalize, and energy security will improve significantly,” Ogbonna said.

In its response, the Federal Ministry of Finance reaffirmed that the 15 percent tariff policy is part of President Tinubu’s broader economic reform agenda aimed at repositioning Nigeria for sustainable growth. The ministry noted that the government is aware of the temporary economic strain the measure might cause but assured that it is working on mitigating strategies, including targeted social interventions for low-income earners and vulnerable households.

“The ultimate goal is to ensure energy self-sufficiency and reduce dependence on imported products that drain the nation’s resources. The tariff will help protect local investment while boosting job creation,” a senior ministry official stated.

The government’s decision comes amid renewed optimism about Nigeria’s refining future. With the Port Harcourt Refinery nearing full rehabilitation and private sector projects like BUA Refinery and Dangi Energy Refinery underway, the administration believes the country is on the verge of ending its decades-long reliance on imported petroleum products.

Manufacturers across Northern Nigeria expressed hope that the policy would also help address logistics and power challenges that have crippled industrial growth for years. “Stable fuel availability is key to reviving northern industries. If local refineries function optimally, we will not only create jobs but also enhance productivity across sectors,” said Aisha Suleiman, Managing Director of a Kano-based manufacturing firm.

The NMA concluded its statement by urging all stakeholders—including fuel marketers, regulators, and investors—to align with the new direction of the Nigerian economy. “It is time for national commitment to self-reliance. This tariff is not just a fiscal policy; it is a patriotic call to rebuild Nigeria’s industrial base,” Ibrahim said.