By Johnmbosco Agbakwuru

The Senate has lamented that Free Zones in the country have not benefited the economy as a result of the weak regulatory framework guiding their operations.

Consequently, the Senate has started the process of amending the Act which had been in existence for over 18 years with what were described as noticeable inherent inadequacies and operational challenges.

But the management of the Nigeria Export Processing Zone Authority, NEPZA, opposed some aspect of the bill, alleging that despite the fact that the Oil and Gas Free Trade Zone and NEPZA have their various areas of specialization, the former tried to intrude into NEPZA affairs.

Chairman, Senate Committee on Trade, Senator Odion Ugbesia who lamented the abysmal performance of trade zones in the country during the public hearing on the Oil and Gas Export Free Zones Authority Act 2011 amendment Bill 2014, in Abuja, said it was due to the low performance of free zones coupled with the weak regulatory framework that the Senate embarked on the amendment.

Senator Ugbesia stated that Free Zones all over the world were instrumental to boosting industrial and economic growth, stressing that it was the reason why the Federal Government established the Onne Oil and Gas Free Zones to provide greater level of foreign direct investment, technology transfer, manpower development, provision of employment opportunities and greater economic self- reliance.

He said: “Simply put, the amendment Bill on Oil and Gas Export Free Zone Act CAP 05 LFN seeks to make consequential provision to the Act for greater effectiveness and efficiency.

“Having operated the Act for about 18 years, some inherent inadequacies and operational challenges were noticed.

Hence the need to repeal the existing Act to correct these inadequacies and challenges. The Amendment Bill therefore seeks to address some of the deficiencies in the Principal Act by creating a more robust legislative framework to regulate and promote effective operation of the Oil and Gas Free Zones Authority.

The most attractive features of a Free Zone anywhere in the world, is the tax holiday which investors enjoy as incentive and encouragement for investment and this amendment provides just that.”

According to Senator Ugbesia, some of the objectives of the Oil and Gas Free Zones Amendments Bill 2014 included the socio-economic development of the immediate community where the Free Zones and Special Investments Areas were located and its contribution to the growth of the country’s Gross Domestic Product.

It also aimed at domesticating business activities in the Oil and Gas sector, generate employment, help in the transfer of skills and technology to Nigerians in the oil and gas industry, facilitates linkages from the oil and gas sector to other sectors of the nation’s economy and also establish and stimulate successful business links between Nigeria and other countries in West African sub region.