THE EXPATRIATE EMPLOYMENT LEVY
The levy represents a significant step towards achieving long-term prosperity and self-reliance for Nigeria and citizens, argues John Ainofenokhai
In conceptualizing a nation’s urgent economic revamp, its workforce empowerment, revenue generation, improvement of nationalization/indigenization, hope is certainly not a plan. Historically, bold economic reforms and their disciplined enforcement remain twin ‘weapon-grade’ tools progressive nations deploy to change the narrative of economic infamy as well as fast-track stability.
As it were, on February 27, President Bola Ahmed Tinubu boldly launched the Expatriate Employment Levy (EEL) and handbook at the State House Council Chambers, Abuja. The flagship policy project will be operated on a Public- Private Partnership (PPP) model between the Federal Government of Nigeria represented by the Ministry of Interior as the guarantor with the Nigeria Immigration Service (NIS), as implementing agency.
The levy, scheduled to commence on Friday, March 15, 2024, comes as part of the government’s effort to bolster the nation’s economy and empower its workforce. At the well-attended launch event, the Minister of Interior, Hon. Olubunmi Tunji-Ojo and Chairman of the Senate Committee on Interior, Senator Adams Oshiomhole, were among other dignitaries.
Clearly, as the country continues to navigate the complexities of globalization and economic disruptions, the EEL indisputably remains a vital instrument for shaping a prosperous and sustainable future for all its citizens.
According to President Tinubu at the launch of the EEL project and handbook in Abuja: “I’ve been further assured that the project has the capacity of plugging loopholes and gaps that have bedeviled the country in dealing with security challenges, movement of foreigners in and out of the country.
“Interestingly, this scheme will wield the dual fold of revenue generation as well as addressing employment challenges as salary gaps attendant in the remuneration of expatriate workers as compared with their Nigerian counterparts.
“There will be clear lines of implementation and effective acceleration of aims and objectives of this programme. Immigration matters and expatriate quotas, and relevant stakeholders, have to be effectively guided to make Nigeria the focus of the objective of this EEL. Therefore, it is my honour that the handbook of the Expatriate Employment Levy is hereby launched.”
Ahead of implementation of the EEL, stakeholders across various sectors are not surprisingly optimistic of its potential to catalyze positive change in the nation’s economy. Targeting promotion of local talent and fostering sustainable growth, the levy represents a significant step towards achieving long-term prosperity and self-reliance for Nigeria and its citizens.
The new initiative is also expected to generate revenue for the government; improve nationalization/indigenization; increase employment opportunities for Nigerians with foreign companies operating in the country; balance employment opportunities between Nigerians and expatriates; close wage gaps between the expatriates and the Nigerian labour force; and facilitate knowledge transfer to grow the economy.
By incentivizing the employment of local talent, the government aims to create a more sustainable and inclusive economy, reducing dependency on external sources for specialized skills.
The implementation of the Expatriates Employment Levy aligns with the nation’s broader economic agenda, which prioritizes indigenous capacity building and job creation. It reflects a strategic shift towards fostering a conducive environment for local businesses to thrive and contribute to national development.
More, the levy is expected to provide a significant boost to government revenue streams, which can be allocated towards critical sectors such as education, healthcare, and infrastructure development.
This injection of funds has the potential of driving socio-economic progress and enhancing the quality of life for Nigerians across board.
Nigeria has witnessed a growing influx of expatriates into its workforce in recent years, driven by globalization, foreign investment, and specialized skills requirements. To regulate this trend and ensure equitable opportunities for its citizens, the federal government has decided to fully implement the EEL.
Without dispute, the EEL serves as a mechanism to encourage the recruitment and development of local talent. By imposing levies on companies employing expatriates, it incentivizes organizations to prioritize the training and employment of Nigerian citizens.
This emphasis on local workforce development not only reduces dependency on foreign labour but also contributes to skill enhancement, job creation, and empowerment within the Nigerian community.
Of critical importance is the fact that revenue generated through the EEL will bolster the government’s financial capacity to invest in critical sectors such as education, healthcare, infrastructure, and social welfare programmes. These will stimulate economic growth, enhance productivity, and create a conducive environment for sustainable development.
By channeling funds into local initiatives, the EEL fosters entrepreneurship, innovation, and small business development, thereby nurturing a robust and diversified economy. And the presence of expatriates in key sectors facilitates the transfer of specialized skills, knowledge, and best practices to the local workforce.
It’s important to realize that the EEL is not merely a fiscal measure but a strategic tool for promoting national development, empowering the local workforce, and fostering economic self-reliance. In effect, by prioritizing the recruitment, training, and retention of Nigerian talent, while facilitating skill transfer, knowledge exchange, and regulatory oversight, the EEL contributes to the creation of a more inclusive, competitive, and resilient economy.
More specifically – and this worth repeating – the objectives of EEL are to promote knowledge and skill transfer from expatriates to local employees. By attaching a financial commitment to the employment of expatriates, government encourages employers to actively engage in training and mentorship programmes. This facilitates the development of local talents, thereby strengthening the domestic workforce over time.
EEL provides a balance between encouraging FDIs and safeguarding the interest of local workers. In this regard, EEL ensures that while expatriate workers contribute to economic development, the rights and opportunities of local employees are not compromised.
EEL also encourages collaboration between government entities, industry associations, business stakeholders as well as provides need for continuous dialogue and consultation between the public and private sectors while channelling policy making towards addressing the needs of various sectors and fulfilling broader national goals.
EEL will also address demographic changes such as aging population or shortage of skilled labour thereby encouraging businesses to prioritize local talent acquisition and invest in workforce development initiatives – ultimately safeguarding the nation’s long-term economic prosperity.
For needful clarity, expatriate workers subject to EEL are those who are non-citizens employed within Nigeria. Expatriate workers may also encompass individuals on specific type of work permits, visas, or other temporary residency arrangements.
The EEL covers the private sector industries that utilizes foreign workforce or rely on expatriate labour, such as construction, ICT, agriculture, manufacturing, oil and gas, telecommunication, services, banking and finance, maritime and shipping and healthcare. Any company/organisation that engaged expatriate talents is subject and liable to pay the EEL.
The Nigeria Immigration Service (NIS) being the government agency saddled with the statutory mandate of “control of persons entering and leaving Nigeria,” shall be responsible for determining which expatriates fall within the EEL purview and enforcing the levy in line with relevant provisions.
The NIS is also to use the data generated from the EEL project for the purpose of enhancing Nigeria’s national security.
With regard to reporting and compliance, government will provide online platforms for employers to report expatriate employment details electronically. These platforms will streamline the reporting process and facilitate efficient data exchange between employers and government agencies.
As a well thought out policy, the EEL, certainly will impact the expatriate employment space which has been largely ungoverned. This should show progressive returns in terms of local workforce mentorship and revenue streams.
Ainofenokhai writes from Abuja
