Transcript Nigeria Export Processing Zones Authority
NIGERIA EXPORT PROCESSING ZONES AUTHORITY
Investment Opportunities in the Nigeria Free Zones
Presented by: Nigeria Export Processing Zones Authority for the Polish Trade Delegation, 11
th
April 2013
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About Nigeria:
• • • • • • • • • • •
Region: Capital:
West Africa Abuja
Population:
167 million people
Climate:
Equi-torial in south, tropical in centre and arid in the North
Total Land Area:
923,770 km sq. out of which about 40 % is arable land
Coast Line:
853 km
Main Ports:
Lagos (Apapa, Tin-can Island), Warri, Port Harcourt, Onne Deep Sea & Calabar.
Main Airports:
Lagos, Kano, Port Harcourt, Abuja, Enugu, Kaduna, Maiduguri, Ilorin, Jos, Owerri, Calabar,Yola, Uyo & Asaba
Macro-economic environment:
Stable with a number of economic reforms ongoing (Transformation Agenda, Average GDP of 6.7% in the last 5 years, low debt profile of <20% of GDP, stable exchange rate at US$: 159)
FDI Inflow:
Nigeria is the second largest recipient of Foreign Direct Investment in Africa after Angola.
Resources:
Huge oil reserves of over 36 billion barrels & gas of over 166 trillion cubic feet, 34 minerals available in commercial quantities, Labour force of about 50% of the population, a number of cash & food crops)
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Nigeria Strategic Position in the World:
United States of America Europe Middle East Asia NIGERIA South America South Africa Australia
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What is a Free Zone?
A Free Zone is a geographically designated area deemed to be outside the customs territory within which national regulations related to production, trade and other economic activities may not be applicable or partially applicable. It is referred to in other countries as Special Economic Zone, Foreign Trade Zone, Enterprise Zone, Industrial Development Zone and so on.
features of a free zone include: The common Location specific and clearly delineated area World class infrastructure & facilities Special tax & physical Incentives Streamlined administrative arrangements (one-stop-shop window)
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Evolution of Nigeria Free Zones:
The Nigeria Free Zone Scheme was introduced in 1992 by the federal government as a policy instrument to drive the economy on a path of industrialization and economic development.
The NEPZA Act No. 63 of 1992 established the Nigeria Export Processing Zones Authority (NEPZA) as the government agency with the mandate to handle the responsibility of establishing, licensing, regulating, and monitoring of free zones in Nigeria.
Due to global dynamics, the Nigeria Free Zones was modified in 2001 to expand the scope of free zones from export oriented activities to include agriculture, commerce, logistics, ICT, tourism, real estate, and more.
The Free Zone program is now liberalized to allow the active participation of the private sector of the economy. It has three types of ownership namely: • • Public Free Zones Private Free Zones and • A combination of both
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Cont’d: Vision:
“To be the most investor friendly Free Zone service provider”
Mission:
“To establish, license, regulate and operate highly efficient Free Zones by providing highly competitive incentive scheme, excellent support facilities and service for the purpose of creating enabling environment for export manufacturing and other commercial activities”
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Objectives:
• Attraction of foreign direct investment • Creation of employment opportunities • Export earnings development/generation • Skills and technology acquisition • Creation of backward linkages • Contribution to GDP growth of foreign exchange • Infrastructural Development • Facilitate trade and greater participation of Nigeria in the global markets and • Socio-economic development of the host community
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Benefits to Free Zone Investors:
• • Free Zones’ close proximity to seaports, airports, railways, and extensive road networks Availability of a huge consumer market of Nigeria’s 167 million population as well as ECOWAS of 250 million people • Availability of abundant natural resources such as cocoa, rubber, palm oil, gum arabic, sesame seeds, wood, minerals, food crops and more • Availability of skilled labour at competitive rates • Free Trade Arrangements (WTO, ETLS, Common Wealth of Nations, AGOA, NEPAD, African Union, D-8, , G-77) • One-stop-shop concept that caters for the needs of enterprises in terms of registration, custom clearance, immigration matters, and others
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• • • • • • • • • • •
Incentives:
Complete holiday from all federal, state and local government taxes, rates, and levies Duty free importation of capital goods, machinery/components, spare parts, raw materials and consumable items in the zones 100% foreign ownership of investments 100% repatriation of capital, profits and dividends Waiver of all imports and export licenses Waiver on all expatriate quotas One-stop approvals for permits, operating license and incorporation papers Permission to sell 100% of goods into the domestic market • However, when selling into the domestic market, applicable customs duty on imported raw material shall apply For prohibited items in the custom territory, free zone goods are allowed for sale provided such a good meet the requirement of up to 35% domestic value addition Minimize delays in the movement of goods and services Rent free land during the first 6 months of construction for government owned zones
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Types of Free Zones:
• • • • • • • •
Export Processing Zones
- These are zones intended to encourage the production of goods and services that are export oriented.
Free Trade Zones
– These zones encourage a mix of activities such as manufacturing, trading, services, real estate, etc.
Border Free Zones
– Zones located at strategic border points to encourage international trade.
Science & Technology Parks
– These parks provide specialized facilities aimed at developing high tech or science based industries
Information & Communication Technology Parks
except this is targeted at attracting ICT companies.
– same as above
Export Processing Farms
– These are agriculture zones dedicated to farming activities and agro-allied processing.
Logistics Free Zones
services mainly.
– These serve the purpose of providing logistics
Oil & Gas Free Zones –
For Oil & Gas activities only.
*Opportunities exist for the establishment of other specialized zones which will be considered on their own individual merit.
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Map of Nigeria Free Zones:
2 5 10 24 14 16 19 4 20 15 22 12 23 17 21 13 8 25 1 3 9 18
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Calabar Free Trade Zone, Cross River State Kano Free Trade Zone, Kano State Tinapa Free Zone & Resort, Cross River State Snake Island Integrated Free Zone, Lagos State Maigatari Border Free Zone, Jigawa State Ladol Logistic Free Zone, Lagos State Airline Service Export Processing Zone, lagos state ALSCON Export Processing Zone, Akwa Ibom State Sebore Farm Export Processing Zone, Adamawa State Ogun Guangdong Free Trade Zone, Ogun State Lekki Free Trade Zone, Lagos State Abuja Technology Village Free Zone, Abuja Ibom Science & Technology Park Free Zone, Akwa Ibom Lagos Free Trade Zone, Lagos State Olokola Free Trade Zone, Ogun & Ondo States Living Spring Free Trade Zone, Osun State Brass LNG Free Zone Banki Border Free Trade, Borno State OILS Logistics Free Zone, Lagos State Kajola Specialized Railway Free Zone, Ogun State Imo Guangdong Free Trade Zone, Imo State Kwara Free Trade Zone, Kwara State Koko Free Trade Zone, Delta State Oluyole Free Trade Zone, Oyo State Ibom Industrial City Free Zone, Akwa Ibom State
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Nigeria Free Zones by Sector:
Multi-sectoral (Manufacturing, Trade, Services): 15 Information Technology: 1 Science & Technology: 1 Agriculture: 1 Logistics: 3 Tourism: 1 Services: 1 Oil & Gas: 1 Others: 1 (Railway transport)
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Investment Opportunities:
• Food Processing • Agricultural Farms & Processing • Wood Products & Furniture • Textile & Garments • Electrical & Electronics • Plastics & Rubber Products • Fertilizer & Petroleum Plants • Steel & Aluminium • Automobile Assembling Automotive components • Oil & Gas • Bio-fuels & • Power generation & supply • Machinery, Equipments & Metal Products • Recycling of products • Cosmetics & Chemical Products • Leather and Handicrafts Products • Logistics & Warehousing services • Pharmaceuticals • Printing Equipment Materials & Office • Ship Building & Repairs • Mining • Estate Development and more!!!
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Free Zone Regulations
: Free Zone Regulations are liberalized, competitive and of international best practice, the following apply: • Licensing Procedure • Free Zone Registry • Customs Procedure • Immigration Procedure • Health, Safety and Environment Procedures • Labour and Human Resources Procedure • Banking Procedure • Land, Building and Construction Procedure
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How to Participate in Nigeria Free Zones:
There are two (2) major ways in which an investor can participate in the Nigeria’s Free Zones:
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2.
Free Zone Developer/Promoter Free Zone Enterprise
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16 Requirements for a Free Zone Developer/Promoter:
• • • • Application letter indicating interest to establish a zone and its location Payment of US$1,000.00 or its Naira equivalent to NEPZA H/Q as application fee Assessment of proposed site by NEPZA Officials Once site is assessed and is satisfactory, Free Zone Developer/Promoter is expected to submit the following: An unencumbered piece of land with Certificate of Occupancy (NEPZA could assist to secure this); Perimeter and topographic survey of the site; Master Plan of the proposed site; Environmental Impact Assessment Report; Detailed Feasibility Study. Issues to be covered by the study should include amongst others:
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Cont’d:
Brief description of the project Names and Resumes of the Promoter/Directors Location and site of the Free Zone Economic viability Marketing strategy Financial viability Sources of funding Project Development Plan • • • • • Meet other requirements as may be determined by NEPZA; Any other information such as MOU or any agreement entered with other partners that will assist in the consideration of the project proposal; Submit application with documents to NEPZA and finally Zone Licensing fee of US$200,000.00 as soon as Mr. President approves the request Zone Management Registration fee of US$60,000.00
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Requirements for a Free Zone Enterprise:
Free Zone Investors interested in locating in any of the Nigeria’s Free Zones are required to carry out the following steps: • Complete an application form which can be downloaded online or collect from the administration of the free zone or from NEPZA HQ in Abuja, with a non refundable fee of US$500 or its Naira equivalent • Submit completed application form to the Zone Administration or NEPZA Office in Abuja along with required Project Plan/Feasibility Study. Application will be reviewed and either approved or returned with observations within five (5) working days • On approval of application, an Operating License (OPL) will be issued by the Free Zone Administration. As soon as your company possess an OPL, it is officially incorporated in Nigeria and does not require any additional paper work with the Corporate Affairs Commission (CAC). It is at this point that Free Zone Administration will discuss your site location and assign or reserve a space for you.
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Cont’d:
• Remit your investment capital through banks located in the zones which will in turn issue a Certificate of Capital Importation.
• Prepare your building or warehouse space. Investors who are constructing their own buildings must submit four (4) copies of full architectural drawings for approval by Zone Management according to established building codes. Built-up space should not exceed 70% of the lease land, and construction should start within three (3) months after execution of agreement.
• Move in and operate. Government has designed the process as streamlined and user friendly as possible. Some companies may have some additional procedure to follow such as obtaining permission for their foreign nationals and employees which can be done at the immigration desk offices in the free zones.
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20 Responsibility of a Free Zone Developer/Promoter:
• • • • • • • • Preparation of a Development Plan with a perspective of 20-25 years and shall be broken up into a short term action plans of 5 years each.
A Master Plan that shall stipulate land use pattern, road and other infrastructure.
Stipulate activity nodes for location of administrative structures, industrial, commercial, services, residential and other employment generating activities that may likely come up Put in place appropriate management structure for the day to day running of the Free Zone Provision of on-site Infrastructure (Pre-built factories & warehouses, power supply, water supply, drainage & sewerage, telecommunication, medical & food facilities, solid waste management, etc) Developing and maintaining on-site infrastructure Address environmental aspects as prescribed by law, planned green areas, and disaster mitigation issues.
Any other responsibility as may be prescribed by NEPZA
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Responsibility of a Free Zone Manager:
• Day to day running of Free Zone activities • Establishing Free Zone’s internal procedures • Sub-leasing of Land to Free Zone Enterprises • Marketing of Free Zone • Collecting fees and dues • Resolving labour dispute as may arise in consultation with NEPZA and Ministry of Labour • Periodic consultation with Free Zone Enterprises for effective operation of free zones • Any other responsibility as may be prescribed by NEPZA
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The Story so far:
The Nigeria Free Zone program is still at its infancy stage, most of the zones are presently under construction. However few are steadily making progress. These are highlighted as follows: • • Total No of Licensed Free Zones (see list) = 25 (10 are currently operational while the rest are at different levels of development) Foreign Direct Investments in Free Zone as of Dec 2012 = US$7.3 Billion Local Direct Investments = N37 Billion • • • • • Direct Employment = 10,129 Indirect Employment = 30,000 Total No of Registered Free Zone Enterprises = 334 • Total Value of International Exports from Jan - Dec. 2012 = US$664 Million Total Value of Local Exports Jan – Dec. 2012 = N29 Billion
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Calabar Free Trade Zone, Cross River State:
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Work-in-Progress Process Skids by Total Support CFZE:
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25 Some Confectionaries Produced by Combination CFZE:
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Generators Assembled and Packaged in CFTZ:
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27 Bao Yao FZE Producing High Texture Rods in CFTZ:
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Medical Products manufactured at CFTZ:
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29 Marble Tiles Produced at the CFTZ:
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Tinapa Free Trade Zone $ Resort, Cross River:
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Snake Island Free Zone, Lagos: 31
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Jetty Location at Snake Island Free Trade Zone, Lagos:
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Crude Oil Separation Storage & Processing Facility at Snake Island Free Zone:
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Lagos Free Trade Zone, Lagos:
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For more information, please contact us at:
Head Office:
No. 2 Zambezi Crescent, Cadastral Zone A6 Off Aguiyi Ironsi Street Maitama, Abuja Tel: +234-9-413-1598 +234-9-7804077; Fax: +234-9-413-1550 Web: www.nepza.gov.ng
Mail: [email protected]
Calabar Office:
Free Trade Zone, P.M.B. 1200, Calabar, Cross River State Tel: +234-808-664961
Lagos Liaison Office:
No. 1 Ajakaiye Street Onipetesi off Agege Moto Way, Mangoro Agege, Lagos State Tel: +234-808-8670504
Kano Free Trade Zone:
No. GP221 Farm Centre Entrance By Marhaba Cinema Kano State Tel: +234-808-3132092