November 17, (THEWILL) — The Centre for the Promotion of Private Enterprise (CPPE) has urged the Nigerian government to immediately reinstate the 15 percent import duty on petrol (PMS) and diesel, warning that its suspension jeopardizes the future of domestic refining capacity, investor confidence, and Nigeria’s long-term energy security.
In a strongly worded policy brief titled “Safeguarding Nigeria’s Domestic Refining Capacity and Energy Security,” CPPE’s CEO, Dr. Muda Yusuf, argues that the temporary suspension of the duty is a short-term political move that could undermine critical investments in local refineries, including the Dangote Refinery and smaller modular refineries.
Context: What Led to the Suspension
In October 2025, President Bola Tinubu approved a 15% import duty on PMS and diesel, aimed at protecting local refiners and reducing Nigeria’s dependence on imported fuel. The duty was slated to take effect later in November.
But in mid-November, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) announced that the duty implementation was suspended.
The NMDPRA cited concerns about supply stability, especially during peak demand, and warned against hoarding or panic buying.
The implementation was not canceled completely, but rather deferred to the first quarter of 2026, to give more time for operational readiness and stakeholder alignment.
Why CPPE Is Concerned
1. Unfair Competition for Local Refineries
According to CPPE, the removal of the duty “tilts the playing field” in favor of imported products, placing domestic refiners at a structural disadvantage.
Yusuf noted that local refineries face high energy costs, difficult logistics, port inefficiencies, expensive financing, and security risks. All of which makes it nearly impossible to compete with cheaper, imported fuel unless protective measures are in place.
2. Investment Risk
CPPE warns that the suspension undermines the predictability that major investors rely on. Multi-billion-dollar investments were made on the basis of stable policy support for local refining.
3. Macroeconomic Risks
The group says that allowing imports to dominate again will re-expose Nigeria to foreign exchange volatility, supply shocks, and growing pressure on the naira.
4. National Strategic Interests
Reinstating the duty, CPPE argues, is not just an economic issue but a matter of national sovereignty. Protecting local refining aligns with Nigeria’s long-term goals of industrialization, job creation, backward integration (e.g., petrochemicals), and stronger economic resilience.
What CPPE Proposes
Dr. Yusuf and CPPE have put forward a multi-part policy recommendation to balance short-term concerns with long-term gain:
Immediate Reinstatement of the 15% import duty.
Regulated Import Volumes to prevent market flooding by imported fuel.
Policy Predictability: Ensure that fiscal and energy policies remain stable to sustain investor confidence.
Complementary Support: Support domestic refiners such as low-cost financing, infrastructure development, and reduced energy costs.
Strategic Adjustment: Include domestic refining in a broader import-adjustment tax regime, similar to other strategic sectors like cement, pharmaceuticals, and automotive.
Reactions & Broader Implications
CPPE: Firmly critical, calling the suspension a dangerous reversal that undermines Nigeria’s refining strategy.
Refinery Sector: The Dangote Refinery, which has ramped up production, sees such duty measures as crucial to its long-term viability.
Economic Risk: CPPE warns that reversing course too quickly could export more of Nigeria’s value chain (jobs, petrochemicals, engineering) abroad.
Energy Security: A strong local refining sector could help reduce Nigeria’s reliance on volatile global fuel markets.
Foreign Exchange: Fuel imports are a major drain on Nigeria’s FX reserves. Protective duties could conserve scarce foreign currency.
Industrialisation: Local refining feeds into broader industrial development; petrochemicals, engineering, and manufacturing.
Jobs: Investing in domestic refineries can create employment in refining, construction, logistics, and downstream sectors.
Policy Credibility: Frequent policy reversals risk eroding investor confidence, especially for heavy infrastructure investments.
CPPE is signaling red it views the suspension of the 15% import duty not just as a tactical retreat, but a dangerous compromise that could undermine Nigeria’s long-term refining ambitions and economic sovereignty. It’s called: reinstate it now, but pair it with smart regulation and support so that local refineries can truly become engines of growth.
Ogochukwu Onwaeze
