A bill to mandate local processing of at least 30 per cent of raw materials in the country before exportation has passed a second reading in the Senate.
The piece of legislation, which aims to amend the Raw Materials Research and Development Council Act, 2022, introducing provisions for local processing and production protection, was sponsored by Senator Peter Nwebonyi, APC Ebonyi North.
Senator Nwebonyi while leading the debate on the bill during Tuesday’s plenary, argued that mandating local processing would boost local manufacturing industries, create jobs for Nigerians and reduce dependence on imports and the demand for foreign exchange.
He said: “Promoting local processing to a minimum of 30 percent or more will add value to our economy, particularly to our Naira. It will also encourage innovation within our local industries, leading to a significant increase in domestic production.”
Senator Nwebonyi added that the bill, if enacted, would shield Nigerian manufacturers from foreign competition by regulating the importation of raw materials that could be processed locally, fostering a favourable environment for domestic industries to thrive.
In his contribution, the Deputy Senate President, Senator Jibrin Barau, commended the sponsor of the bill for his thoughts and innovation towards founding and re-energizing the nation’s economy, lamenting that “day in and day out, raw materials are exported out of this country to develop other economies.”
“We have the capacity, human capital, and technical resources to act on these raw materials and to process these raw materials. And by not doing so, we are undermining our economy while allowing for the promotion of other economies.
“Once this bill is passed, it will now be mandatory that these raw materials be processed here, at least 30 per cent. This will energise our economy by providing jobs and promoting our real sector. Our real sector will be energised; we will go up and running. It’s very straightforward.
“Several industries will emerge because it will now be mandatory that you don’t engage in this lazy attitude of taking raw materials outside the shores of this country. This raw material must be processed here,” he explained.
The Deputy Senate Minority Leader, Senator Kamorudeen Oyewumi, PDP Osun West, however, raised concerns about the bill’s practicality, particularly in sectors lacking local processing capacity.
He said: “There is a need for amendments due to the nature of some products. We assume that all these products should not be exported raw, but what about when there are no companies to process them locally?”
While warning that strict enforcement of the bill could harm local farmers who rely on export markets for raw materials, he advised against granting blanket approval, “as farmers may incur losses if raw materials cannot be processed locally.”
The Senate President, Senator Godswill Akpabio, after the bill scaled second reading, referred it to the Committee on Science and Technology, and mandated to report back within four weeks.