The Federal Government has approved sweeping reductions in import duties on electric vehicles, mass transit buses, and key manufacturing inputs, in a bid to cushion rising living costs and support economic activity amid global oil market volatility triggered by geopolitical tensions.
The policy directive, approved by President Bola Ahmed Tinubu, forms part of a broader set of fiscal measures designed to mitigate the impact of the ongoing Middle East crisis on Nigeria’s economy, particularly as higher crude oil prices continue to drive up fuel and transportation costs.
Details of the intervention were disclosed on Monday by Special Assistant to the President Dada Olusegun, on his X account, who said the tariff adjustments are aimed at easing inflationary pressures, improving affordability for consumers, and supporting local businesses.
“President Tinubu’s administration has approved a massive reduction in import duties of selected products in order to further reduce inflation, empower local businesses and increase affordability for consumers,” Olusegun said.
Under the new policy, import duties on electric vehicles (EVs) and mass transit buses have been reduced from 5 per cent to zero, a move expected to lower the cost of transportation and accelerate the adoption of cleaner mobility options. The government also eliminated the 5% levy on manufacturing machinery, a step aimed at reducing production costs and stimulating industrial output.
Further adjustments were made across several critical import categories. Duties on passenger vehicles were cut from 70 per cent to 40 per cent, while tariffs on bulk rice were reduced from 70 per cent to 47.5 per cent and broken rice from 70 per cent to 30 per cent. Raw cane sugar duties were lowered from 70 per cent to between 55 per cent and 57.5 per cent, and crude palm oil tariffs were reduced from 35 per cent to 28.75 per cent.
In the industrial and construction sectors, import duties on steel sheets and coils were reduced from 45 per cent to 35 per cent, while tariffs on glazed ceramic tiles were cut from 55 per cent to 46.25 per cent, measures expected to ease costs across manufacturing and real estate value chains.
The government has also introduced a 90-day transition period beginning April 1 to allow markets adjust gradually to the new tariff regime and prevent supply disruptions or pricing shocks.
The policy response comes against the backdrop of heightened global uncertainty stemming from the ongoing Israel–US–Iran conflict, which has disrupted oil supply chains and driven volatility in energy markets. The crisis has significantly affected shipping routes around the Strait of Hormuz, a critical corridor responsible for roughly one-fifth of global crude oil flows.
Since the onset of the conflict in late February, crude oil prices have experienced sharp swings, surging to as high as $120 per barrel amid supply concerns before retreating below $95 following a temporary ceasefire announcement on April 8. However, renewed tensions have reignited market fears.
On April 12, U.S. President Donald Trump ordered a naval blockade of vessels entering or leaving the Strait of Hormuz after peace talks between the United States and Iran collapsed. The escalation pushed Brent crude prices above $102 per barrel, while West Texas Intermediate (WTI) climbed to $104.16 per barrel on April 13.
Analysts say the surge in oil prices has heightened inflation risks globally, with Nigeria particularly exposed due to its reliance on imported refined petroleum products and vulnerability to exchange rate pressures.
The latest tariff reductions signal a proactive fiscal approach by the Federal Government to counter imported inflation and sustain economic momentum. By lowering the cost of transportation, food imports, and industrial inputs, authorities aim to shield households and businesses from the ripple effects of global energy shocks.
Market watchers note that the effectiveness of the measures will depend on implementation and broader macroeconomic conditions, including exchange rate stability and global commodity price trends.
Nonetheless, the policy underscores the administration’s intent to deploy targeted fiscal tools to navigate an increasingly uncertain global environment while supporting domestic growth.
