How COVID-19 and insecurity are making businesses idle in 17 free trade zones

Findings from the Nigerian Tribune revealed how insecurity and the COVID-19 pandemic have killed off most Free Trade Zones (FTZs) in parts of Nigeria.

Recall that the Nigeria Customs Service (NCS), in its semi-annual report for the year 2022, stated that out of the 42 free trade zones in Nigeria, only 25 are active, of which 15 operate in zone 'A ', 4 in Zone 'B', 5 in Zone 'C' and 1 in Zone 'D'.

Under customs administration, Area D falls under the territories of Bauchi, Gombe, Borno, Yobe, Adamawa, Taraba, Benue, Plateau and Nasarawa states.

Speaking to the Nigerian Tribune over the weekend, an NCS source who would not want his name printed as he is not allowed to speak explained that insecurity was a major problem for the free zones of area D. < /p>

"Area D Free Trade Zones have had to deal with the prevalence of insecurity in this zone. You will agree that for the states in this zone, some of them have been most affected when we talk about the impact of insecurity in the country.

"And that's one of the main reasons why we currently only have one functioning free zone in this area. Even that one is in trouble. That's when peace reigns in this region that businesses can thrive.

"Before, we had about five free zones in Zone D. All of them have closed due to insecurity, except one which, for the moment, is struggling to function.

"The South West (Zone A) has the highest concentration of free trade zones as it has experienced relative peace better than some other areas of the country. The South West alone has 15 free trade zones which are all prospering. If only relative peace can return to Zone D, then the number of free zones can improve.

“Many free zones closed during the height of the insurgency in the region,” the customs source told the Nigerian Tribune exclusively.

Also speaking on the impact of COVID-19 on free zones in Nigeria, the Chief Executive of the Nigerian Export Processing Zones Authority (NEPZA), Prof. Adesoji Adesugba explained that the pandemic is one of the main reasons why many registered free zones have been rendered inactive.

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Also speaking to the Nigerian Tribune over the weekend, Prof. Adesugba explained that the impact of COVID-19 has been devastating on most businesses during the advent of the pandemic.

According to Professor Adesugba, "First of all, the impact of the COVID-19 pandemic has been devastating on businesses. Most businesses in inactive free zones have closed because of this.

"Furthermore, prior to this, there was a global economic collapse which also impacted businesses globally. The dire situation was not unique to Nigeria alone. Global businesses also been affected.

“So for some businesses in some of our free zones, a lot of them went dormant because of that. Remember, that was foreign investment. did not happen as expected due to the devastating COVID-19 pandemic.

“This is a major problem that most businesses have faced during the COVID-19 pandemic. Many have become inactive. When the business environment is difficult globally, the search for investment funds becomes difficult.

"But I can tell you that new free zones have started to arrive. I don't have the statistics now, but with an improvement on a global level. Business climate, we have started to register new free zones. "

Free Trade Zones are special economic zones that, in addition to providing local employment opportunities, engender technology transfer, help build local capacity, provide a viable market for other local producers of raw materials and increase the quality of goods that can potentially be available on the local market upon payment of applicable duties and taxes.