‘Inconsistent policies rob free trade zone of investors, benefits’

•FAAN suspends programme at airports

Inconsistency in policies of the Federal Government has been blamed for the failure of the free trade zone programme and its potential benefits in the travel and tourism sector.

Stakeholders, who spoke from experience yesterday in Abuja, said the mere designation of airport corridors as free trade zones, without commitment to steady policy and infrastructure development, would not attract good investors to yield economic gains.

Apparently, in lieu of concerns, the Federal Airports Authority of Nigeria (FAAN) has suspended the issuance of licences to applicants for the free trade zones at the nation’s airports, pending the resolution of conflicts in the regulatory framework between it and the Nigeria Export Processing Zones Authority (NEPZA).

General Manager, Vicven Integrated Services, Obinna Emeazo, who spoke at a panel session of the FAAN National Aviation Conference (FNAC) in Abuja, noted that the misfortune of Tinapa Resort in Cross River State was a graphic example of what policy summersault could do to a noble initiative.

Emeazo noted that TINAPA was initially marketed under the agreement that domestic consumers could each make purchases valued up to $5000 from the zone without having to pay import duty. However, after the project was already far gone in development, this allowance was decreased to $330. Obviously, this significantly reduced patronage to businesses located there and discouraged investors.

He said: “Tinapa Resort started well and so many investors were attracted by the benefits, but along the line, it was brought down to $330, which led to the dwindling of the growth of the resort.

“Everyone, especially tourists, goes to Tinapa to shop and enjoy their holidays. So, it is inconsistent on the part of the government. You brought out policies that attracted investors and mid-way, you changed such policy. If they have to focus on the special economic zones, we have to make it right. NEPZA must stand its ground and make it strong. The regulations must be strong.

“If you cannot manufacture, you cannot export. How much are you able to attract? When was the last time you heard about Tinapa? It is still at the elementary stage and one would have expected that it would have gone beyond that,” he said.

Emeazo further decried multiple regulations between FAAN and NEPZA as one of the major factors slowing down the growth of free trade zones in the country, stressing that both agencies had to harmonise their policies for the progress of the country.

“NEPZA has to show strong leadership and must be able to show strong collaboration with other agencies. You have the Federal Inland Revenue Service (FIRS), which is tax; there is still an argument on the tax investors enjoy. Some states still come to tell investors to pay tax. They should be able to bring all the states together.

“In their board of directors, you see all the government agencies like customs, finance ministry, FIRS and others, yet you do not see a strong stakeholder like FAAN. At the level of implementation, FAAN will tell you it is against its own approval,” he said.

Capt. Rabiu Yadudu, the Managing Director, FAAN, has suspended the issuance of new licenses to intending free trade zone applicants at the airport areas.

According to him, at the Lagos Airport alone, there are presently two free trade zone operators, while additional two companies have applied.

He explained that as it stands today, all the five international airports in the country have been designated as free trade zones and warned that if not well-regulated, it may be a big challenge for the country in the future.

Yadudu insisted that FAAN and other relevant authorities like the Nigerian Ports Authority (NPA) should be represented on the board of NEPZA to be able to address the challenges in the system.