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The export Expansion Grant scheme is a very vital incentive required for the stimulation of export oriented activities that will lead to significant growth of the non-oil export sector.
The Federal Government is committed in its efforts to bring about tremendous growth in non-oil exports and is resolved to enhance efficiency, transparency and accountability in the administration of the key incentive for non-oil export development. The “Export Expansion Grant EEG” is therefore, a policy tool to further this objective.
The use of incentives supports the NEEDS objective of mainstreaming businesses that are currently operating in the informal sector. It is also in line with the NEEDS requirements that companies desiring to receive benefits from the government will have to comply with the laws of the country.
The government in reviewing the scheme set out the following guidelines:
GUIDELINES:
1. Incentives Rate
The Scheme would operate the Weighted Eligibility Criteria” in assessing applications for EEG. The baseline data as supplied by individual applicant company would be used in its assessment. Thus the method of assessment is “company specific.” A company’s EEG assessment would be conducted once yearly and the determined rate will apply throughout the year.
The Weighted Eligibility Criteria has three bands: 30%, 15% and 10%. The following template will be used in assessing the incentive rate of every EEG applicant Determination of Export Performance – Eligibilibity Criteria
| ELIGIBILITY CRITERIA |
COMPANY DATA |
THRESHOLD |
WEIGHT |
COMPANY SCORE |
| Local Value added |
|
20% |
20% |
|
| Local Content |
|
35% |
20% |
|
| Employment (Nigerians) |
|
500 |
20% |
|
| Priority Sector |
|
Manufacturing only |
10% |
|
| Export growth |
|
10% |
25% |
|
| Capital Investment |
|
10% |
5% |
|
Total Weight = 100%
A new entrant into the EEG Scheme shall provide prior period financial statement or where applicable an investment plan for its assessment. However, to encourage export of value added and processed/manufactured products, exporters shall be divided into three categories:-
EEG Rate applicable to the 3 categories of exporters
| Scoring Key |
Manufacturing(Processed to finished products) |
Non-Manufacturing(Processed to semi-finished) |
Merchant Exporter and Exporters of Primary Products
(including commodities and Solid minerals) |
| Scores Band |
EEG Rate % |
EEG Rate % |
EEG Rate % |
| > 70 |
30 |
15 |
10 |
| > 50 |
25 |
10 |
7.5 |
| > 25 |
20 |
5 |
5 |
| >5% |
15 |
0 |
0 |
| < 5% |
0 |
0 |
0 |
Exporters whose activities/products fall into more than one category shall have their EEG rate for each different category determined by the application of their eligibility criteria score to the appropriate activity/product score table for EEG rates. The rates then determined are applied to appropriate NXPs.
Please note that:
- Each activity/ product type is to be exported using different NXPs.
- For the transition period for exports made under MEIBS, all exports with Bill of lading dated 1st July 2005 shall be eligible for EEG as per the rates applicable under the above guideline
2. Eligibility
- An exporter must be registered with the Nigerian Export Promotion Council (NEPC)
- An eligible exporter shall be a manufacturer producer or merchant of products of Nigerian origin for the export market (i.e. the products must be made in Nigeria).
- An exporter must have a minimum annual export turnover of N5 million and evidence of repatriation of proceeds of exports.
- An exporter-company shall submit its baseline data which includes audited Financial Statement and information on operational capacity to NEPC.
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