In response to escalating food prices and supply shortages, the Nigerian government suspended import duties, tariffs, and taxes on essential agricultural commodities for 150 days, effective 15 July—31 December 2024.
This policy was introduced as part of the Presidential Accelerated Stabilisation and Advancement Plan (PASAP) to curb food inflation and enhance food security. The Nigeria Customs Service officially communicated the policy, following directives from President Bola Ahmed Tinubu and the Minister of Finance, Olawale Edun.
According to the National Bureau of Statistics (NBS), Nigeria’s food inflation rate had exceeded 32% by mid-2024, making staple foods unaffordable for millions of households. Prices of essential commodities such as rice, wheat, maize, sugar, and edible oils had surged, significantly damaging households and threatening economic stability.
To mitigate this crisis, the government removed import duties to lower retail prices and ease the cost-of-living burden, prevent social unrest by improving food accessibility and provide short-term relief while working on long-term agricultural reforms.
The Nigeria Customs Service (NCS) oversaw policy enforcement, while the Federal Ministry of Finance managed importer eligibility requirements. This initiative aligned with broader economic recovery strategies aimed at stabilising the food supply and affordability. While the duty suspension provided immediate relief, concerns emerged about its impact on local farmers and economic sustainability. Critics argued that over-reliance on imports could weaken domestic agriculture, increasing Nigeria’s vulnerability to external market fluctuations.
As a temporary measure, the policy was subject to periodic reviews. Its long-term success depended on effective execution, market response, and sustained investments in local food production to ensure lasting food security.
The 2024 duty-free import policy was designed to address food inflation while ensuring regulatory oversight. It introduced several key measures to facilitate the importation of staple foods while safeguarding domestic agriculture. These measures include:
The policy temporarily removed import duties, tariffs, and taxes on six essential agricultural commodities: maize, husked brown rice, wheat, grain sorghum, millet, and beans. This measure aimed to lower market prices and improve the availability of staple foods for consumers. However, it was time-bound, effective from 15th July to 31st December 2024, with provisions for periodic reviews to assess its impact and determine any necessary adjustments based on market conditions.
Strict eligibility requirements were enforced to prevent misuse and ensure the benefits reached legitimate agribusinesses. Companies had to be registered in Nigeria and operational for at least five years. In addition, they were to have a consistent record of filing annual returns, financial statements, and tax payments. Importers of husked brown rice, sorghum, and millet were required to own milling facilities with a minimum capacity of 100 metric tonnes per day, while those importing maize, wheat, or beans needed to either own large-scale farmland or have a structured production network supporting their operations.
The Federal Ministry of Finance managed approvals to ensure effective implementation, while the Nigeria Customs Service (NCS) enforced compliance. The Ministry provided Customs with a pre-approved list of importers and their assigned quotas, ensuring that only eligible businesses participated. Additionally, at least 75% of imported commodities had to be sold through registered commodity exchanges to maintain fair pricing and market stability. Importers must maintain proper storage records and transparent documentation to track product distribution. Companies found violating the policy faced revocation of waivers and had to pay full VAT, import duties, and other levies.
Although the policy aimed to reduce food costs, the government introduced safeguards to protect local farmers. These included targeted subsidies and financial incentives to help farmers compete with imports, access to credit and technical assistance to strengthen domestic agricultural productivity, and periodic policy reviews (every 3–6 months) to assess their impact and determine the next steps.
The temporary suspension of duties provided immediate relief; however, its lasting effectiveness relied on strategic investments in local food production. The government’s objective was to reduce dependence on imports over time by enhancing domestic production capacities. This approach aimed to achieve affordability without compromising sustainability and self-sufficiency.
Removing import duties directly benefits Nigerian households by lowering the retail prices of essential food items, making staple foods more affordable. This policy is particularly important for low and middle-income families, as it eases financial strain amid rising inflation. It supports national efforts to combat food insecurity, reducing the risks of malnutrition and economic hardship.
While consumers enjoy lower prices, local farmers face increased competition from imported commodities, which could reduce demand for domestically produced alternatives. If cheaper imports continue, it may discourage investment in local agriculture, affecting farmers’ income and long-term sector growth. However, the government has introduced supportive measures like subsidies and credit access to help farmers modernise operations and enhance competitiveness.
For businesses involved in food importation and distribution, the policy provides an opportunity for increased profits, as reduced import costs improve margins and encourage market expansion. However, local processing industries may struggle to compete with cheaper imports, potentially leading to job losses and production slowdowns. The government’s requirement that 75% of imported goods be sold through commodity exchanges ensures market stability and protects local industries.
While the policy helps stabilise food prices in the short term, it raises concerns about Nigeria’s long-term trade strategy. Increased reliance on food imports can expose the economy to foreign exchange risks and fluctuations in global commodity prices. Balancing immediate relief with sustainable agricultural policies will be essential to ensuring food security without weakening domestic production.
This policy contributes to overall economic stability by preventing a rise in living costs. Keeping essential food prices stable also helps to maintain social stability, as increases in food prices have historically been associated with civil unrest. Moreover, decisive economic interventions can enhance investor confidence, indicating that the government proactively addresses economic challenges.
In summary, suspending import duties provides immediate relief to consumers and agribusinesses. However, it poses long-term challenges for local farmers and food security. Strategic adjustments and targeted support for domestic agriculture are crucial to ensure sustainable economic growth beyond the temporary nature of this policy.
Despite its well-intentioned objectives, the temporary ban on import duties has faced several challenges that could undermine its effectiveness:
One of the most pressing concerns is its impact on domestic agriculture. The influx of inexpensive imports into the market creates stiff competition for local farmers, making it difficult for them to sustain profitability. If domestic producers cannot match the lower prices of imported goods, their long-term viability could be threatened. Additionally, there is the risk that consumers may become overly dependent on imported commodities, which could discourage investment in local agriculture and slow down necessary improvements in domestic food production.
The policy also has significant fiscal implications. Import duties are an important source of government revenue, and their temporary suspension has led to a shortfall in funds that could have been allocated to other public spending priorities. If the government does not find alternative sources of revenue, this shortfall may impact infrastructure projects, agricultural development programs, and other critical services.
These have further complicated the policy’s rollout. Delays in issuing import approvals and quota allocations have caused uncertainty among key stakeholders, making it difficult for businesses to plan effectively. Without a well-structured monitoring system, there is also a risk of market distortions, where traders could exploit the temporary ban to create artificial shortages or price spikes, ultimately defeating the policy’s purpose.
International trade considerations also play a crucial role in the policy’s success. The government must carefully manage trade relations to ensure the policy does not conflict with existing agreements or create tensions with international partners. Additionally, concerns have been raised about the duration of the duty-free window. Stakeholders, particularly those in the Organized Private Sector (OPS), have argued that the 150-day period is insufficient to impact food prices, calling for an extension that would allow businesses to fully benefit from the policy.
Monitoring and compliance risks present another significant challenge. Weak enforcement mechanisms, corruption, and regulatory loopholes have affected similar policies, raising concerns about the proper documentation and distribution of imports. Without strong oversight, there is a risk that the intended benefits of the policy could be undermined by mismanagement. While the temporary suspension of import duties has provided short-term relief to consumers and agribusinesses, it also poses considerable risks to local farmers, government revenue, and long-term food security. Striking a balance between immediate affordability and sustainable agricultural policies is essential for ensuring Nigeria’s economic stability.
The Temporary Ban on Import Duties for Essential Agricultural Commodities (2024) represents a decisive, temporary measure designed to address immediate food security and inflation challenges. The policy helps consumers directly and supports the economy as it faces rising prices and supply issues. However, the policy is not without its risks. The potential for undermining domestic agriculture, fiscal revenue losses, and market distortions are all challenges that must be carefully managed through complementary measures and robust oversight.
