The Federal Government has highlighted the need to focus on local production of building materials and incentivizing manufacturers to ensure housing affordability in the country.
Minister of Housing and Urban Development, Ahmed Dangiwa, spoke at the Stakeholder Forum on Development of Fiscal Incentives for Manufacturers of Local Building Materials Components in Nigeria in Lagos.
Dangiwa observed that on average, building materials account for approximately 50 per cent to 70 per cent of the total cost of building a house, adding that cement alone can account for 15 per cent to 20 per cent of the total cost, while steel and reinforcement materials make up another 10 per cent to 15 per cent.
“Roofing materials account for 5 per cent to 10per cent, doors, windows, and finishes can take up 10per cent to 15 per cent, and electrical and plumbing materials round off with 5 per cent to 10 per cent. Sand, gravel, and aggregates contribute 5 per cent to 10 per cent, and blocks and bricks add another 5 per cent to 10 per cent,” he said.
He noted that these figures highlight a clear reality that if “we can reduce the cost of these materials through local production and strategic fiscal incentives, we can significantly lower the overall cost of housing construction. This, in turn, will make housing more accessible to the average Nigerian.”
The minister said that local manufacturing of building materials has the potential to create thousands of jobs, stimulate economic growth, and reduce reliance on imported materials. He revealed that by supporting local manufacturers, the country can foster innovation, improve quality, and reduce costs, making housing more affordable for Nigerians.
“Local production of building materials will directly contribute to reducing the cost of construction, thereby making housing more accessible to the average Nigerian. This aligns with the Federal Government’s commitment to providing affordable housing for all,” he said.
He said the government is actively working to establish building materials manufacturing hubs across the country. These hubs, he said, will serve as centralised locations where manufacturers can access shared infrastructure, reduce production costs, and benefit from economies of scale.
He explained that by providing targeted support to these producers, such as access to affordable financing, tax incentives, and infrastructure improvements, the nation can enable them to increase production capacity, lower costs, and meet the growing demand for building materials without the need for entirely new hubs.
“The development of fiscal incentives for manufacturers of local building materials is not just a policy option; it is a necessity for the growth of our economy and the realization of our housing goals,” he stated.
Vice Chairman, Senate Committee on Lands, Housing and Urban Development, Senator Victor Umeh, said the lawmakers are willing to support policy incentives in the form of tax reliefs and duty exemptions, import duty waivers, subsidies for local manufacturers, access to low-interest financing and ensuring public-private partnerships (PPPs), research and development grants and infrastructure support for manufacturers.
Permanent Secretary of the ministry, Dr Shuaib Belgore, said the ministry recognises the vital role that the availability and affordability of building materials play in the development of sustainable housing and infrastructure.
“The rising costs of these materials, he said, have posed a significant challenge to developers, policymakers, and aspiring homeowners alike. It is, therefore, imperative that we explore viable incentives and strategic interventions that will promote local production, enhance affordability, and reduce dependence on imports,” Belgore added.
