……..Government strengthens Free Zones integrity, retains lawful incentives and opens framework to digital economy.
The Federal Government has moved the reform of Nigeria’s Special Economic Zones (SEZs) from broad stakeholder consultation to the drafting stage, with the Honourable Minister of Industry, Trade and Investment, Dr. Jumoke Oduwole, MFR, assuring investors and operators that the process will strengthen the integrity of the Free Zones regime while protecting legitimate investments made under the existing framework.
The development follows the commencement of a dedicated drafting retreat by the Special Economic Zones Legislative and Regulatory Reform Committee, with membership including – the Federal Ministry of Industry, Trade and Investment (FMITI), Nigeria Export Processing Zones Authority (NEPZA) and the Oil and Gas Free Zones Authority (OGFZA); working with the Federal Ministry of Justice,
The retreat opened with engagements involving key stakeholders, including the Nigeria Economic Zones Association (NEZA), National Single Window, Nigeria Customs Service and Nigeria Revenue Service (NRS), whose presentations helped frame the issues for consideration before drafting commenced.
Importantly, Customs and the NRS joined the drafting retreat, reflecting the Federal Government’s decision to ensure that the implementation of customs and tax provisions at the free zones are developed with the direct participation of the institutions responsible for administering them.
The ongoing drafting exercise is also incorporating concerns raised by operators, enterprises, industry associations and professional advisers during the stakeholder engagement held on 17 September.
The reform comes amid renewed public attention to the integrity of the Free Zones scheme following recent enforcement actions by the Nigeria Customs Service concerning allegations of diversion of goods admitted under Free Zone concessions into the domestic market.
Addressing the concerns, Dr. Oduwole stressed that the reform is not aimed at dismantling the Free Zones regime or withdrawing the lawful incentives that underpin its attractiveness to investors.
She reaffirmed the continued relevance of incentives such as duty-free importation of capital goods, tax exemption on qualifying export profits, 100 per cent foreign ownership and unrestricted repatriation of capital and profits, subject to applicable laws and regulations.
“A Free Zone cannot become an alternative route into the Nigerian domestic market on terms unavailable to manufacturers operating in the Customs Territory,” the Minister said.
“But this is not an argument against Free Zones. It is an argument for protecting them. Legitimate investors who have committed capital to Nigeria deserve certainty. The rules must be clear. Institutional responsibilities must be clear. Customs and tax treatment must be predictable. And lawful incentives must remain defensible.”
Dr. Oduwole further stated that the reform presents an opportunity to preserve the elements of the Free Zones regime that are working, address identified gaps and create a framework capable of supporting Nigeria’s evolving economy.
“The choice before Nigeria is not between preserving the Free Zones scheme and dismantling it. It is whether we can preserve what works, correct what does not and build a framework capable of serving the economy we are becoming,” she said.
Chairman of NEPZA, Hadi Mutallab, said the reform was necessary to strengthen the integrity of the scheme and ensure that the incentives provided translate into increased investment, production, jobs and exports.
He stressed the need to protect legitimate operators and provide a clear and predictable transition to the new framework.
“The objective should be a stronger and more competitive Free Zones regime that addresses abuse without weakening the investors who are doing the right thing,” he said.
Similarly, the Executive Secretary of the Nigeria Economic Zones Association (NEZA), Mr. Toyin Elegbede, welcomed the consultative approach adopted by the Federal Government.
He said operators recognised the need for a strong, transparent and well-regulated SEZ regime, while urging that reforms should address genuine gaps without creating uncertainty for businesses that invested under the existing framework.
“Ultimately, we all want the same thing: a competitive Free Zones ecosystem that attracts investment, protects legitimate businesses and delivers greater production and exports for Nigeria,” Elegbede said.
Among the key issues raised at the 17 September stakeholder engagement and carried into the drafting retreat are:
Treatment of existing investments and clear transition arrangements for current licensees;
The proposed 75/25 export-to-domestic-sales framework, including possible phased implementation;
Customs coordination, joint inspections and simplified Customs exit procedures;
Foreign exchange, tax reporting and treatment of services provided within the Zones; and
Avoidance of multiple regulatory interfaces, while retaining NEPZA and OGFZA as coordinating authorities within their respective statutory mandates.
A key principle proposed by stakeholders was “one authority, one visit, one record”, which Dr. Oduwole described as a useful test for the final implementation framework.
A major feature of the proposed Regulations is the express recognition of Digital Free Zones and Digital Free Zone Enterprises, including new licence categories such as Innovator and Sandbox licences for businesses that may not require conventional physical presence.
The development aligns with President Bola Ahmed Tinubu, GCFR’s directive to move the Digital Free Zones initiative into implementation, with a roadmap for its full launch within 180 days.
According to Dr. Oduwole, the expansion into digital activities reflects the changing nature of global trade and Nigeria’s growing services economy.
“Nigeria’s future exports will not only leave our ports in containers,” she said. “Nigerian companies increasingly export technology, financial and professional services, creative products, intellectual property and other digitally delivered services. A modern Special Economic Zones regime must be able to attract those businesses as deliberately as it has historically sought to attract manufacturers.”
The reform, anchored on the Renewed Hope Agenda, is designed to support the Federal Government’s efforts to expand Nigeria’s productive base, deepen non-oil exports, attract investment and create jobs.
The Ministry acknowledged the support of the National Assembly, including the House Committee on Commerce chaired by Hon. Ahmed Munir, and reaffirmed that stakeholder consultation will continue as the legislative and regulatory framework progresses towards finalisation.
Obilor-Duru Augustina Okechi
Head Press and Public Relations Department
Federal Ministry of Industry, Trade and Investment
Abuja, Nigeria
28th September 2026
