EO3 Local Content Policy Summary

What Is This Policy?

Executive Order No. 3 of 2017 (EO3) is the Federal Government of Nigeria’s directive requiring all Ministries, Departments and Agencies (MDAs) to grant preference to Nigerian manufacturers and local service providers in all public procurement of goods and services. Signed on May 18, 2017 by Acting President Yemi Osinbajo, the Order mandates a minimum 40% local procurement threshold across eight priority product categories, establishes compliance and reporting timelines, and directs institutional reform of procurement practices — anchoring Nigeria’s import substitution drive and its Economic Recovery and Growth Plan (ERGP) within the government’s own purchasing power.

Who Does It Target?

All Ministries, Departments and Agencies (MDAs) of the Federal Government of Nigeria as procuring entities Heads of MDAs responsible for procurement oversight, monitoring, and compliance reporting The Minister of Industry, Trade & Investment, as the coordinating authority for the Made-in-Nigeria initiative The Director-General of the Bureau for Public Procurement (BPP), responsible for rule updates and enforcement Nigerian manufacturers, suppliers, contractors, sole proprietors, and service firms eligible for preferential treatment Bidders and potential contractors responding to government solicitation documents (tenders, proposals, quotations)

What Does It Aim to Achieve?

Grant binding procurement preference to domestic manufacturers and Nigerian service providers across all federal MDAs Ensure at least 40% of MDA procurement expenditure on eight designated categories is sourced from local manufacturers or service providers Mandate verifiable local content declarations in all government solicitation documents to prevent false compliance claims Direct institutional assessment of existing local content compliance within 90 days and submission of reform recommendations Generate a consolidated Made-in-Nigeria report with policy recommendations to the President within 180 days Curb capital flight, boost capacity utilisation, generate employment, and support Nigeria’s Economic Recovery and Growth Plan (ERGP)

Key Features

Universal MDA Obligation: All federal MDAs must grant preference to local manufacturers and Nigerian service providers — this is a mandatory directive, not a guideline 40% Minimum Local Threshold: At least 40% of procurement spending on eight listed categories must be locally manufactured goods or services by Nigerian providers; waivers require BPP approval Eight Priority Categories: Uniforms & Footwear; Food & Beverages; Furniture & Fittings; Stationery; Motor Vehicles; Pharmaceuticals; Construction Materials; and Information & Communication Technology Verifiable Local Content Statement: All solicitation documents must require bidders to provide a verifiable statement confirming the local content of goods or services offered Solicitation Document Disclosure: Every MDA tender, RFP, or bid document must expressly state the preference and eligibility criteria for domestic manufacturers and contractors 90-Day Compliance Audit: MDA heads must assess monitoring, enforcement, and compliance with EO3 and the Public Procurement Act within 90 days and report findings to the Minister of Industry 180-Day Made-in-Nigeria Report: The Minister of Industry, Trade & Investment and the BPP Director-General must submit a comprehensive report with specific recommendations to strengthen local content laws within 180 days Immediate Effect: The Order took effect on the date of signing — May 18, 2017 — with no transitional or grace period for MDAs

Current Status

Rollout Stage: Active — signed May 18, 2017; among three Executive Orders issued on the same day; complemented by Executive Order No. 5 of 2018 (Science, Technology and Innovation for Local Production) BPP Directives: The Bureau for Public Procurement has been directed to update procurement rules, compile a register of credible local suppliers, and enforce strict compliance; officers violating the directive face disciplinary action Made-in-Nigeria Drive: The Ministry of Industry directed civil servants to wear Made-in-Nigeria attire on designated days as part of the wider campaign; the Order is a pillar of the ERGP’s import substitution strategy Nigeria First Policy: The Tinubu administration’s 2024 ‘Nigeria First’ policy reaffirmed EO3’s principles, signalling continued presidential commitment to local content preference in public spending Enforcement Challenges: Independent assessments have found enforcement to be inconsistent; compliance has been described as “rich in packaging, lean in impact” due to insufficient monitoring mechanisms and low institutional accountability Procurement Scale: Federal Government procurement represents a substantial share of public expenditure; vigorous implementation is projected to significantly reduce capital flight and accelerate domestic industrial recovery

How to Access

MDAs (Procuring Entities): Embed local content preference criteria and 40% threshold requirements in all solicitation documents immediately; update internal procurement procedures and train procurement officers MDA Heads: Within 90 days, conduct a compliance audit of procurement practices and submit findings and reform proposals to the Honourable Minister of Industry, Trade & Investment Nigerian Manufacturers & Suppliers: Prepare and maintain verifiable local content documentation to submit with bids; register with BPP’s credible local supplier database to ensure eligibility for preferential procurement Bureau for Public Procurement: Obtain a waiver from BPP in exceptional cases where local procurement at the 40% threshold is not feasible; engage BPP for updated procurement rules and compliance guidance Minister of Industry: Lead consolidation of MDA reports and submit the Made-in-Nigeria initiative report with specific legislative and policy recommendations to the President within 180 days of the Order Contact: Bureau for Public Procurement (BPP): bpp.gov.ng | Ministry of Industry, Trade & Investment: industry.gov.ng | Office of the SGF: osgf.gov.ng

Important Terms

Local Content: The amount of Nigerian or locally produced human and material resources utilised in the manufacture of goods or rendering of services — the Order’s own definition under Paragraph 7 Made-in-Nigeria Products: Goods manufactured within Nigeria by Nigerian persons or companies; accorded procurement preference under EO3 in the eight designated categories Solicitation Document: Any MDA document issued for the purpose of soliciting offers, bids, proposals, or quotations for goods and services; must expressly state local content preference and eligibility criteria 40% Threshold: The minimum share of MDA procurement expenditure on the eight listed categories that must go to locally manufactured goods or Nigerian service providers Bureau for Public Procurement (BPP): The regulatory authority under the Public Procurement Act 2007 responsible for oversight, enforcement, and rule-setting for all federal procurement; issues waivers in exceptional cases

Impact & Metrics

Federal Government procurement constitutes a major share of public expenditure; channelling even 40% of designated-category spending to local suppliers represents billions of naira redirected into the domestic economy Capital flight from government procurement — previously estimated at the majority of recurrent and capital procurement spend — is a primary target; EO3 is designed to retain this value within Nigeria Eight categories spanning uniforms, food, vehicles, pharmaceuticals, ICT, furniture, construction, and stationery cover the widest cross-section of MDA day-to-day and capital procurement needs EO3 is a core plank of the ERGP 2017–2020, which projected accelerated economic recovery, increased capacity utilisation, employment generation, and improved balance of trade through import substitution

Official Resources

Website: osgf.gov.ng | bpp.gov.ng | industry.gov.ng | nipc.gov.ng Policy Document: Executive Order No. 3 of 2017 — available via the Office of the Secretary to the Government of the Federation (OSGF) and the Nigerian Investment Promotion Commission (NIPC) Contact: Bureau for Public Procurement (BPP), Abuja | Office of the SGF, Shehu Shagari Complex, Three Arms Zone, Abuja Summary prepared using the Policy Summary Template | Source: EO3 2017, OSGF, Bureau for Public Procurement, NIPC, Mondaq/LeLaw Legal, The Guardian Nigeria, Brookings Institution | March 2026

Legal Framework

Executive Order No. 3 of 2017 on Local Content is issued under the President's executive powers under Section 5 of the 1999 Constitution. It operates under the Public Procurement Act 2007, the Nigerian Oil and Gas Industry Content Development Act 2010 (as a model), and the Nigerian Investment Promotion Commission Act. The Order aligns with WTO Agreement on Government Procurement (GPA) provisions on local content and UNCTAD's investment policy review recommendations for Nigeria.