LAGOS – Nigeria Employers’ Consultative Association has commended the Federal Government for the new Executive Order introducing zero tariff, duty, and Value Added Tax for pharmaceutical products. 

Recall that President Bola Tinubu recently signed an Executive Order introducing zero tariffs, Excise Duties and VAT on some pharmaceutical raw materials and specialised pharmaceutic machinery and equipment to boost the production of essential healthcare products in the economy. 

The association, while advocating full implementation of the policy, said the Executive Order came at a time when local pharmaceutical companies faced an almost existential challenge and an acute shortage of raw materials, high cost of production and low output, and other input materials in recent years. 

Mr Adewale-Smatt Oyerinde, the Director General of NECA, while commending the President Bola Tinubu for signing the Executive Order, said: “The quick and timely implementation of the Policy would provide a leeway out of the current cost challenges and allow the sector to rebound as 50% of raw materials currently in pharmaceutical sector are imported. 

“The huge cost challenges facing the sector due to the depreciation of the Naira has generally increased the cost of import of input materials and the attendant clearing charges.” 

Oyerinde, observed that about 50 per cent of raw materials used in the pharmaceutical sector are imported, notwithstanding the volatility of the Naira, import duties and other charges. 

He noted that these costs add to the high cost of production in the sector and inflated pharmaceutical product prices, which account for an increased inventory of unsold goods and the low contribution of the sector to the Gross Domestic Product. 

He recalled that the National Bureau of Statistics report, the pharmaceutical sector contributed 0.25 per cent and 0.26 per  2023, respectively, while invencent to real GDP in 2022 and tory of unsold pharmaceutical products stood at N79bn in 2022 according to an industry report. 

While calling for timely and religious implementation of the Executive Order, Oyerinde noted that deft monitoring and engagement with stakeholders would ensure the successful implementation of the Order. 

“We note with concern the fate that has bedevilled many other Executive Orders. We hope that greater efforts will be put into making the new order work for the benefit of the industry and Nigerians in general,” he said