Preferential Access, Poor Results: Nigeria’s Export Paradox
Two Decades of Access, Little Diversification
FOR more than 20 years, Nigeria has been handed preferential access to some of the world’s largest markets. From the United States’ African Growth and Opportunity Act (AGOA) to the African Continental Free Trade Area (AfCFTA), successive governments have promoted trade agreements as the pathway out of crude oil dependence. Yet, the structure of Nigeria’s exports has barely changed.
In 2024, oil and gas still accounted for about 90 per cent of Nigeria’s export value, while non-oil exports hovered below 12 per cent—only marginally higher than the sub-three per cent recorded in 2000 when AGOA was launched.
Growth That Flatters to Deceive
On paper, exports have grown. Nigeria’s total exports more than doubled from around $20 billion in the early 2000s to about $50 billion in 2024. But much of that growth reflects oil price cycles and currency depreciation rather than genuine expansion of non-oil production.
Repeated naira devaluations have masked weak export performance. A manufacturer earning ₦10 million from exports in 2000 took home nearly $98,000. Today, that same naira value yields barely $7,000. While figures rise in naira terms, dollar earnings often stagnate or fall.
AGOA, AfCFTA and the Execution Gap
AGOA was designed to help Nigeria build manufacturing capacity, revive textiles and scale agro-processing. That transformation never materialised. Nigeria’s exports to the U.S. continue to fluctuate with oil prices, while non-oil goods remain negligible.
AfCFTA, once described as Nigeria’s biggest opportunity, has fared no better. By mid-2024, Nigeria had issued just 10 Rules of Origin certificates under the framework, compared with thousands by South Africa, Egypt and Ghana. Even within Africa, Nigeria mainly exports petroleum products, not manufactured or processed goods.
Trade Deals Without Competitiveness
Experts argue the problem is not access but competitiveness. Nigeria’s manufacturers face unreliable electricity, high logistics costs, congested ports and interest rates exceeding 20 per cent. In some cases, it costs more to move goods from Benue to Lagos than from Lagos to Europe.
Dr. Muda Yusuf of the Centre for the Promotion of Private Enterprise says Nigeria is not short of agreements but lacks the capacity to implement them. “Our manufacturing handicaps mean we cannot compete on price or quality,” he said.
Old Pattern, New Deals
Despite this history, Nigeria recently signed a Comprehensive Economic Partnership Agreement with the UAE. Analysts warn it risks following the same pattern—headline announcements without structural change.
Until Nigeria fixes production costs, infrastructure, financing and value addition, trade deals will continue to recycle the same outcome: crude exports, imported finished goods and fragile foreign exchange earnings.
