President Bola Tinubu has signed an executive order aimed at revitalizing the Nigerian health sector by introducing zero tariffs, excise duties, and value-added tax (VAT) on imported pharmaceutical inputs.
According to Muhammad Ali Pate, the coordinating minister of health and social welfare, the order is designed to increase local production of healthcare products, including pharmaceuticals, diagnostics, devices, and biologicals.
“In a transformative move to revitalize the Nigerian health sector, His Excellency President Bola Ahmed Tinubu, GCFR, has signed an Executive Order aiming to increase local production of healthcare products,” Pate said in a statement.
The order is a crucial step in the success of the Presidential Healthcare Value Chain Initiative (PVAC_NG), which was approved by the president in October 2023. The initiative aims to unlock the healthcare value chain by reducing production costs and enhancing the competitiveness of local manufacturers.
The order introduces zero tariffs, excise duties, and VAT on specified machinery, equipment, and raw materials, including Active Pharmaceutical Ingredients (APIs), excipients, and other essential raw materials required for manufacturing crucial health products. It also provides for establishing market-shaping mechanisms, such as framework contracts and volume guarantees, to encourage local manufacturers.
The minister of health, finance, industry, trade, and investment, and other relevant agencies, including the Nigeria Customs Service (NCS), National Agency for Food and Drug Administration and Control (NAFDAC), Standard Organisation of Nigeria (SON), and Federal Inland Revenue Service (FIRS), will collaborate to develop a harmonized implementation framework. This will ensure swift implementation, with special waivers and exemptions effective for two years.
According to Pate, the order will pivot towards market-based incentives to encourage medical industrialization, reduce costs of medical products through import substitution over time, create and retain economic value, and enable job creation in the healthcare value chain. He thanked the president for his courage and commitment to ensuring Nigeria is put back on the path to prosperity.
