In furtherance of his administration’s fiscal reforms initiative, President Bola Tinubu on Friday signed an Executive Order waiving tariffs, excise duties, and value-added tax (VAT) on imported pharmaceutical inputs.
The Minister of Health and Social Welfare, Prof. Muhammad Ali Pate, who announced the waiver, explained that the measure was part of the government’s efforts targeted at revitalizing the Nigerian health sector by boosting the nation’s capacity for local production of healthcare products.
According to him, the Executive Order aims to increase local production of pharmaceuticals, diagnostics, medical devices such as needles and syringes, biologicals, and medical textiles.
He stated: “In a transformative move to revitalize the Nigerian health sector, His Excellency President Bola Ahmed Tinubu, GCFR, has signed an Executive Order aiming to increase local production of healthcare products (pharmaceuticals, diagnostics, devices such as needles and syringes, biologicals, medical textile, etc.).”
Pate clarified that the Minister of Justice and Attorney General of the Federation, Prince Lateef Fagbemi, SAN, would be responsible for codifying the new order.
He listed the specified items in the Order as including “Active Pharmaceutical Ingredients (APIs), excipients, other essential raw materials required for manufacturing of crucial health products like drugs, syringes and needles, Long-lasting Insecticidal Nets (LLINs) and Rapid Diagnostic Kits, among others.
“The Order also provides for establishing market shaping mechanisms such as framework contracts and volume guarantees, to encourage local manufacturers”, the minister added.
Pate stated that the Order also mandates collaboration among the ministers of health, finance, as well as industry, trade and investment, to develop a harmonised implementation framework — expediting regulatory approvals and reducing bottlenecks.
He explained that relevant agencies including the Nigeria Customs Service (NCS), National Agency for Food and Drug Administration and Control (NAFDAC), Standard Organisation of Nigeria (SON), and Federal Inland Revenue Service (FIRS) “will ensure swift implementation, with special waivers and exemptions effective for two years”.
“The implication of this order is pivot towards market-based incentives to encourage medical industrialization, reducing costs of medical products through import substitution over time, creating and retaining economic value and enabling job creation in the healthcare value chain”, Pate added.
Experts see the latest Executive Order as a crucial component of the initiative to unlock the healthcare value chain (PVAC-NG), which the President approved in October 2023.
