Analysts warn of economic fallout from Trump’s new tariffs on Nigeria

Agency Report

Nigeria is among several nations facing fresh trade restrictions as former U.S. President Donald Trump introduced a 14 per cent tariff on Nigerian exports.

The move is part of a broader protectionist trade policy that includes a baseline 10 per cent tariff on all imports into the U.S. and reciprocal tariffs against countries imposing high duties on American goods.

Announced during a White House event titled Liberation Day, the move marks a significant departure from the U.S.’s traditional free-trade stance.

Economists and trade analysts warn that these tariffs could have a far-reaching impact on Nigeria’s economy, which relies on export revenues to sustain growth.

Dr. Olufemi Ajayi, an international trade analyst, cautioned that “Nigeria’s already fragile export market could face severe disruptions, particularly as crude oil exports to the U.S. have been declining. The new tariff adds another layer of difficulty for Nigerian businesses trying to penetrate the American market.”

Trade between Nigeria and the U.S. has been significant, with transactions totaling N31.1 trillion between 2015 and 2024, according to the National Bureau of Statistics (NBS).

Imports from the U.S. during this period amounted to N16.4 trillion, representing 8.7 per cent of Nigeria’s total trade. However, declining U.S. purchases of Nigerian crude oil have already weakened exports, and this tariff adjustment may further strain economic ties.

Dr. Sarah Obi, an economist at Lagos Business School, emphasized the need for Nigeria to reassess its trade policies.

“If Nigeria does not take proactive measures to renegotiate its tariff structures, we may see increased costs for exporters, reduced competitiveness, and potential job losses in key industries such as agriculture, textiles, and manufacturing,” she warned.

The tariff structure also affects several other African nations, with the U.S. imposing reciprocal tariffs based on half the rates these countries levy on American goods.

Beyond Africa, Asian nations such as Vietnam, Cambodia, and Bangladesh—known for imposing high tariffs on U.S. products—will now face import duties between 37 per cent and 49 per cent when exporting to the U.S.

Trump’s Make America Wealthy Again trade policy threatens to disrupt longstanding trade benefits under agreements like the African Growth and Opportunity Act (AGOA). Nigeria has historically benefited from AGOA, but these new restrictions could significantly reduce its export volume.

Dr. Ajayi suggested that Nigeria explore trade diversification. “It’s time to shift focus towards intra-African trade under the African Continental Free Trade Area (AfCFTA) and establish stronger economic ties with European and Asian markets,” he stated.

For Nigeria, this is a critical moment to reassess its tariff policies before further economic repercussions set in. Businesses that rely on exports to the U.S. may suffer losses, leading to potential job cuts and economic instability.