NIGERIA – The Federal Government of Nigeria has annonced a new directive reserving contracts that are less that N5bn (about US$13 million) to locals, locking out foreign firms from such projects in future.
The Federal Government said the decision was part of an effort to support indigenous firms in line with planned local content laws in the country.
Nigeria’s minister of State, Works and Housing, Abubakar Aliyu, while speaking on the new directive said the government would embark on a comprehensive categorization programme to ensure effective implementation of the policy.
Nigeria is currently working to develop a new local content bill sponsored by the Chairman, Senate Committee on Local Content, Senator Teslim Folarin.
According to Florin, the Bill aims to support the current drive to transform Nigeria into an industrialised, globally competitive country.
Folarin assures that if passed into law in its present form, the bill required that approvals for the award of contracts by the Federal Executive Council (FEC) will require the issuance of a Nigerian Content Compliance Certificate to the awardee.
In addition, the lawmaker during a media interview said that the Public Procurement Policy would be relied upon to make local content compliance, a requirement for granting of Certificate of No Objection to procuring entities.
According to him, the bill is designed to introduce procedures that will improve the implementation of the local content Act in the hydrocarbon resources sector as well as other sectors.
Among other provisions, the draft bill provides for local content development committee to be headed by the Vice President, who will drive policy direction on local content across the broad spectrum of the nation’s economy.
The Bill also features other requirements limiting presence of foreigners in the country. These include registration of expatriates and proof of valid residence permit.
The three bills on local content development currently under consideration by Nigeria’s Parliament are considered by some of the law makers as very important and sacrosanct to the development of the country’s economy.
They seek to consolidate on the gains of the implementation of local content component in the oil and gas industry, pursuant to the enactment of the Nigerian Oil and Gas Industry Content Development Act in 2010.