Nothing short of quality supervision is expected especially for a government structure established for the provisions of foreign exchange earnings, job creations, revenue generation, the attraction of direct foreign investment to enhance knowledge, technology transfer, grants, provision of required permits, and licenses to conduct approved enterprises within the free trade zones and to regulate, supervise, manage, control and coordinate the activities of free trade zones in the country.
In the light of quality supervision, the Federal House of Representatives is probing the management and day-to-day operations of the Export Free Trade Zones Authorities in Nigeria. The probe became necessary due to a lack of accountability with running funds.
The House of Reps in a recent plenary affirmed that the indicted agency responsible for managing the Free Trade Zones across the country had defaulted in accounting for monies derived from the registration of companies allowed to operate in Free Trade Zones Across the country.
To cut to the chase, the lower chamber of the National Assembly in more specific terms is investigating the management of Free Trade Zones in Nigeria for an estimated value of ₦300 million uncounted funds accruing from monitoring, and maintenance of proper transfer pricing audit documentation. They jointly described this development of suspected irregularities as a fraud on the entire country.
Hon. Ntufam Eta Mbora who raised the motion eventually passed by other floor members in a joint decision observed that inconsistencies and concerted collaborations at the Oil and Gas Free Trade Zones have resulted in numerous shortages and leakages on effective and correct revenue collection, diversion, and non-remittance to appropriate Federal Government agencies.
Highlighting why the investigation is necessary, the House noted that the country’s growth and economic indices have continually slowed down because of over-reliance on the oil sector and deliberate abandonment of the non-oil sectors by successive governments, negligence of trade and commerce which remains a veritable sector to sustain the economy particularly in the face of dwindling revenue from the oil sector and the Coronavirus pandemic.
Check out Hon. Ntufam Eta Mbora’s comments during plenary,
“The House is aware that billions of naira have been expended into the Free Trade Zones and Oil and Gas Free Trade Zone on their establishment and huge budgetary allocations have been provided in the past fifteen years without commensurate result in terms of infrastructural development and achieving the aims for which they were established.
“The House is worried that since the inception of these Free Trade Zones, given the volume of investments by the Federal Government of Nigeria and the enormous revenues accruing to the operating registered companies in the designated free trade zones which is in the neighborhood of ₦300 million without proper monitoring, maintenance of proper transfer pricing audit documentation resulting in shortchanging the country.
What you should know
The Calabar Free Trade Zone (CFTZ) formerly known as Calabar Export Processing Zone (CEPZ) came into existence in 1992, modified and rebranded as Calabar Free Trade Zone in 2001 whereas the Oil and Gas Free Trade Zone (OGFTZ) Onne, Port Harcourt was established in 1996 but began operation in 2001 as the first two established free zones followed by the establishment of Lekki Free Trade Zone in 2006, while the Warri port complex was upgraded to free trade zone in 2011.