The Nigerian Economic Summit Group (NESG) has advised the Federal Government to urgently revise its tariff policies and renegotiate trade terms with strategic international partners, following the potential impact of a new wave of US protectionist policies modeled on US President Donald Trump’s trade stance.
The recommendation is contained in a newly released report by the NESG titled “Trump’s Policy Playbook 2.0: Strategic Implications of US Reciprocal Tariffs for the Nigerian Economy and Way Forward”.
On April 2, 2025, President Trump followed through on his tariff threats by announcing a 10 percent baseline tax on all imports into the United States, alongside higher tariff rates on countries running trade surpluses with the US.
The report assesses the implications of the US’s likely impacts of reciprocal tariffs and nationalistic trade policies and proposes strategic options for Nigeria’s economic policy managers.
According to the NESG, “Nigeria should deepen its diplomatic relations with its major trading partners to avoid losing larger markets for its products. The government needs to revise its tariff regimes or negotiate new trade terms, seeking new bilateral trade relationships, which may unlock new opportunities for Nigerian investors. The country can adopt selective tariffs depending on the degree of sectoral vulnerability to external trade.”
The think tank warned that a continuation or escalation of reciprocal tariffs by the United States could trigger a domino effect globally, disrupting the already fragile trade environment for developing countries like Nigeria.
Consequently, the NESG noted, Nigeria must take preemptive steps to protect key sectors of its economy and ensure access to critical export markets.
Refineries and Downstream Sector Need Urgent Boost
The NESG also stressed the importance of improving the competitiveness of Nigeria’s oil and gas sector, especially in light of its substantial import bills.
“Mineral fuel (including petrol) imports account for at least 30% of Nigeria’s import bills per annum. Hence, ongoing efforts to revitalise the state-owned refineries should be strengthened to improve local oil refining,” the report stated.
It added that “substantial investments in the downstream oil and gas sector are needed to make it more competitive globally. This would further reduce the reliance on imported fuel products, boost FX savings and taper the pressure on the FX market.”
The report advocates for a diversified export base and robust industrial policies that can withstand shocks from external trade disruptions. It also recommended that Nigeria scale up participation in regional trade blocs, particularly the African Continental Free Trade Area (AfCFTA), as a buffer against external volatility.
More insights
China and India have emerged as Nigeria’s largest sources of imports, accounting for a combined N20.31 trillion in total imports, according to the latest trade report from the National Bureau of Statistics (NBS).
An emerging trend from the 2024 trade data suggests that Nigeria is increasingly tilting towards Eastern markets, particularly China and India, in its trade relations.
