Over a million jobs would be lost in the Nigerian pharmaceutical industry if the combination of the Common External Tarrif (CET) and implementation of the National Drug Distribution Guidelines are implemented by the Federal Government, the Pharmaceutical Group of the Manufacturers Association of Nigeria (PMG/MAN) has warned.
The CET is one of the instruments of harmonizing ECOWAS Member States and strengthening its common market by adopting same customs duties, import quotas, preferences or other non-tariff barriers to trade and apply to all goods entering the area, regardless of which country within the area they are entering.
Similarly, the NDDG initiated by the Federal Government in 2012 to reform and regulate drug distribution in the country was expected to become effectively from July 1, 2015.
According to PMG MAN’s president, Mr. Okey Akpa who spoke recently in Lagos, “the CET spells doom for the local industry as imported medicines will become far cheaper than locally produced ones. This situation is inimical to the survival of the local pharmaceutical manufacturing sector, and there is a need for an urgent review.”
He further stated that “the lack of demand for locally manufactured medicines as a result of cheap imports will lead to idle capacities and negatively impact previous investments in the sector worth over N300bn. A weak local manufacturing sector will inevitably lead to an influx of cheap imported medicines of doubtful quality.”
Akpa hinged his argument on the CET’s policy, which places zero tariff on finished imported medicine while essential raw and packaging materials required by the industry for local medicine production attracts 5% to 20%.
While commending the Federal Government over the NDDG, the PMG/MAN president called on the authorities to review the idea in consultation with stakeholders, and postpone the implementation of the policy.
“Raw materials imported by pharmaceutical manufacturers should be eligible for duty–free entry, and an import adjustment tax of 20% on imported finished pharmaceutical products of HS Codes 3003 and 3004 should be imposed immediately.”
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