NEPZA To Launch Policy Consultation on Blockchain Operations At Free Zones

Following requests from local and international players, the Nigerian Export Processing Zones Authority (NEPZA) is considering the launching of policy consultation with other relevant agencies on the opening up of Nigerian free zones space to blockchain tech and cryptocurrency operations.

This was disclosed by the Managing Director of NEPZA, Prof Adesoji Adesugba while receiving in audience two blockchain firms who visited separately to make submissions on their proposals for blockchain operations in Nigerian free zones areas.

The Finlease in its submission seeks the endorsement of NEPZA for the establishment of Lekki International Financial Centre at the Lekki Free Zone(LIFCFZ) while Araba Technology Limited is equally proposing the establishment of a high tech digital infrastructure-free zone to provide top end crypto and blockchain tech services.

The Managing Director of Finlease, Prince Dr Sunday Sijuade told the management of NEPZA that the planned Lekki International Financial Centre is to cover an offshore crypto zone to cater for cryptocurrencies and become an offshore destination for crypto exchanges, digital assets and virtual assets.

According to Sijuade, the proposal is in line with international trends across global special economic zones, citing examples of Chinese Financial free zones in Shanghai, the United Arab Emirates’ International Finance Centre and other parts of Europe and North America where such Innovations have been introduced into the free zones.

The Managing Director of Araba Tech in his submission noted that opening up the zone to blockchain operations will provide the necessary backbone for the development of digital economy in Nigeria and Africa.

While both firms advocated for blockchain operations and hubs in the free zones, they, however, called on the management of NEPZA to create a regulatory framework to enable a seamless operation of the proposed blockchain financial exchanges and centre.

” We are convinced that NEPZA should immediately open consultation with the Security and Exchange Commission, FIRS, Central Bank of Nigeria and other relevant agencies on the establishment of a policy framework to regulate the emerging sector”, Dr Sijaude posited.

Responding, Prof Adesugba informed the firms that his team has received multiple presentations on the need for crypto exchanges and hubs within the Nigerian special economic zones to tap into multi-billion dollar revenue streams which presently eluded Nigeria.

“I have also been approached at various international gatherings and events on why Nigeria, despite her fiscal pressure, is comfortable losing so much in capital gains tax to neighbouring nations. We are aware of various reports and studies that indeed confirm the operations of blockchain technology in many special economic zones all over the world.

“Our management is therefore considering launching policy consulation with sister agencies on the need for a regulating framework on this emerging field. It is worrisome that Nigeria is said to be losing billions of dollars annually in capital gains tax paid to other nations even though the crypto transactions took place in Nigeria.

“Statistics on crypto operations even pile up more pressure. Nigeria is currently the number one country in the world in terms of people searching for “Bitcoin” and “Crypto” keywords on Google, with over 6.3 per cent of the entire population owning at least one type of cryptocurrency. In the Chainalysis 2021 Global Crypto Adoption Index, Nigeria is ranked sixth out of the top 20 countries in terms of cryptocurrency adoption”, Adesugba said.