NIGERIA announced on Tuesday a new mandatory levy on any organisation employing expatriate workers.

Foreign companies will now be required to pay $15,000 (£12,000) for expatriate directors and $10,000 (£8,000) for other categories of workers.

Staff working at diplomatic missions and government officials are exempt from the new rule.

Organisations or individuals failing to comply with the scheme face fines or a jail term of up to five years.

President Bola Tinuba said the new levy is being introduced as a way to encourage foreign companies to employ more Nigerians on their workforces.

But the president warned that the levy should not be used to stifle potential investment in the struggling Nigerian economy.

He said: “The goal is to close wage gaps between expatriates and the Nigerian labour force while increasing employment opportunities for qualified Nigerians in foreign companies in the country.”

Nigeria is experiencing its worst economic crisis in a generation, which has led to widespread public protests in recent months.

Trade unions and government workers on Tuesday held demonstrations to protest against the soaring cost of living in Africa’s most populous country.

Mr Tinubu said he understood that Nigerians were facing hard times, but efforts were being made to improve the country’s finances and grow the economy.