Macroeconomic trade context

Annual trade volume, 2023

• Total trade: ₦71.4 trillion (≈ US$85.2 billion)
• Exports: ₦35.8 trillion (US$42.7 billion), ↑ 12.3% from 2022
• Imports: ₦35.6 trillion (US$42.5 billion), ↑ 18.6% from 2022
• Trade balance: ₦0.2 trillion surplus (US$0.2 billion)
• Trade-to-GDP ratio: 25.8% (exports: 12.9% of GDP)
• Global rank: 52nd largest exporter, 49th largest importer
• World export share: 0.21%
• Currency: Nigerian naira (₦); ₦1 ≈ US$0.00067; US$1 ≈ ₦1,480 (official) or ₦1,650 (parallel market)
• Exchange rates: multiple rates, with a significant parallel market premium

Geographic distribution, 2023

Export markets (₦35.8T / US$42.7B)

Import origins (₦35.6T / US$42.5B)

Detailed export product analysis

A. Crude petroleum (₦27.9T / US$33.3B, 78.0%)

1. Crude oil grades

2. Export terminals (capacity)

• Bonny Terminal: 9.2M barrels a month
• Forcados Terminal: 8.4M barrels a month
• Qua Iboe Terminal: 7.6M barrels a month
• Brass Terminal: 3.2M barrels a month
• Escravos Terminal: 6.8M barrels a month

3. Major buyers (share of total crude exports)

• India: 25%
• Spain: 15%
• Netherlands: 12%
• United States: 10%
• Indonesia: 8%

B. Natural gas (₦4.3T / US$5.1B, 12.0%)

1. LNG exports: ₦3.5T / US$4.2B

• Nigeria LNG (NLNG): 22 MTPA capacity
• Buyers: Spain, France, Portugal and Turkey
• Terminal: Bonny Island LNG terminal

2. Pipeline gas: ₦0.8T / US$1.0B

• West African Gas Pipeline: to Ghana, Togo and Benin
• Regional exports: to neighbouring countries

C. Non-oil exports (₦3.6T / US$4.3B, 10.0%)

1. Agricultural products: ₦1.8T / US$2.1B (5.0%)

• Cocoa beans and products: ₦0.7T / US$0.8B (raw cocoa beans ₦0.4T / US$0.5B; cocoa butter and powder ₦0.3T / US$0.4B)
• Sesame seeds: ₦0.4T / US$0.5B (the world’s 3rd largest exporter)
• Cashew nuts: ₦0.3T / US$0.4B
• Rubber and gum arabic: ₦0.2T / US$0.2B
• Other agricultural products: ₦0.2T / US$0.2B

2. Solid minerals: ₦0.9T / US$1.1B (2.5%)

• Zinc ore: ₦0.3T / US$0.4B
• Lead ore: ₦0.2T / US$0.2B
• Limestone: ₦0.1T / US$0.1B
• Other minerals: ₦0.3T / US$0.4B

3. Manufactured goods: ₦0.7T / US$0.8B (2.0%)

• Cement: ₦0.3T / US$0.4B (Dangote, Lafarge)
• Fertilisers: ₦0.2T / US$0.2B
• Other manufactures: ₦0.2T / US$0.2B

4. Services exports: ₦0.2T / US$0.2B (0.5%)

• ICT services: ₦0.1T / US$0.1B
• Transportation: ₦0.05T / US$0.06B
• Other services: ₦0.05T / US$0.06B

Detailed import product analysis

A. Capital goods and machinery (₦10.7T / US$12.8B, 30.0%)

1. Industrial machinery: ₦4.6T / US$5.5B

• Power generation equipment: ₦2.1T / US$2.5B
• Construction machinery: ₦1.4T / US$1.7B
• Agricultural machinery: ₦0.7T / US$0.8B
• Other industrial machinery: ₦0.4T / US$0.5B

2. Electrical equipment: ₦3.6T / US$4.3B

• Generators: ₦1.8T / US$2.1B
• Electrical machinery: ₦1.1T / US$1.3B
• Electronics: ₦0.7T / US$0.8B

3. Transport equipment: ₦2.5T / US$3.0B

• Passenger cars: ₦1.4T / US$1.7B (250,000 units a year)
• Commercial vehicles: ₦0.7T / US$0.8B
• Aircraft and parts: ₦0.4T / US$0.5B

B. Industrial supplies (₦14.2T / US$17.0B, 40.0%)

1. Refined petroleum products: ₦8.9T / US$10.6B (25.0%)

• Premium motor spirit (PMS): ₦5.3T / US$6.3B
• Diesel (AGO): ₦2.5T / US$3.0B
• Aviation fuel (ATK): ₦0.7T / US$0.8B
• Kerosene: ₦0.4T / US$0.5B

2. Chemicals: ₦2.8T / US$3.3B

• Organic chemicals: ₦1.4T / US$1.7B
• Fertilisers: ₦0.7T / US$0.8B
• Pharmaceutical ingredients: ₦0.7T / US$0.8B

3. Other industrial supplies

• Iron and steel: ₦1.8T / US$2.1B
• Plastics: ₦0.7T / US$0.8B

C. Consumer goods (₦7.1T / US$8.5B, 20.0%)

1. Food and beverages: ₦4.6T / US$5.5B

• Wheat: ₦1.8T / US$2.1B
• Sugar: ₦0.7T / US$0.8B
• Fish: ₦0.7T / US$0.8B
• Milk and dairy: ₦0.5T / US$0.6B
• Other foodstuffs: ₦0.9T / US$1.1B

2. Other consumer goods

• Pharmaceuticals: ₦1.4T / US$1.7B
• Electronics and appliances: ₦1.1T / US$1.3B

D. Services and other imports (₦3.6T / US$4.3B, 10.0%)

Trade procedures and regulations: deep dive

A. Customs declaration process

1. Regulatory framework

• Primary authority: Nigeria Customs Service (NCS)
• Legal basis: Customs and Excise Management Act (CEMA) and various Finance Acts
• Trade agreements: ECOWAS Trade Liberalisation Scheme (ETLS), African Continental Free Trade Area (AfCFTA) and various bilateral agreements
• Currency controls: multiple exchange rates and import restrictions

2. Import prohibition list

• Absolutely prohibited: live or dead birds (poultry); refined vegetable oils; cassava products; used tyres; used refrigerators and air conditioners; weapons and ammunition without a licence
• Restricted (additional approvals required): rice; cement; vegetable oil in retail packs; furniture; fruit juice in retail packs; poultry products

3. Timeline requirements

4. Mandatory documents for imports

1. Form M (application for import), filed online through the Trade Portal
2. Proforma invoice
3. Final commercial invoice
4. Bill of lading or air waybill
5. Certificate of origin
6. Packing list
7. SONCAP certificate (for regulated products)
8. NAFDAC registration (for food, drugs and chemicals)
9. Pre-shipment inspection report (for goods over $500)
10. Insurance certificate
11. Single Goods Declaration (SGD) form
12. Bank documents (Form A for foreign exchange, payment evidence)

B. Taxation and duties

1. Customs duties

• ECOWAS Common External Tariff (CET): 0–20%
• Additional levies: multiple surcharges
• Trade remedies: anti-dumping and safeguard measures where applicable
• Preferential rates: under ETLS, AfCFTA and bilateral agreements

2. Special levies

• National Automotive Council levy: 2% on vehicles
• National Agency for Food and Drug Administration levy: 1% on regulated products
• Standards Organisation levy: 0.5% on regulated products
• ECOWAS trade levy: 0.5% on imports from outside ECOWAS

3. Exemptions and concessions

• ECOWAS ETLS: duty-free for approved products
• Manufacturing inputs: concessional rates for raw materials
• Agricultural equipment: duty-free for qualifying items
• Pioneer status industries: tax holidays
• Export processing zones: customs duty exemption

C. Foreign exchange regulations

1. Multiple exchange rate system

• Official rate: Central Bank of Nigeria rate (₦1,480/$)
• NAFEX rate: investors and exporters window (₦1,550/$)
• Parallel market: ₦1,650–₦1,750/$
• Import restrictions: 43 items barred from official foreign exchange

2. Form A requirements

• Mandatory for all imports over $10,000
• Processed through authorised dealer banks
• Supporting documents required
• Maximum validity: 180 days

3. Export proceeds repatriation

• Mandatory repatriation within 90 days
• NXP form required
• Processed through authorised dealer banks
• Penalties for non-repatriation

D. Special procedures

1. Pre-shipment inspection

• Scope: mandatory for imports over $500
• Inspectors: approved inspection companies (Cotecna, SGS, Bureau Veritas)
• Verification of: price, quantity, quality and classification
• Outcome: a Risk Assessment Certificate (RAC) is issued

2. Bonded terminals

• For goods awaiting clearance
• Located outside the main ports
• Reduce port congestion
• Additional charges apply

3. Manufacturing-in-Bond Scheme

• Eligibility: export-oriented manufacturers
• Benefit: duty suspension on raw materials
• Requirements: minimum 70% export, a bank guarantee and regular reporting

4. Export processing zones

• Zones: Calabar Free Trade Zone, Lekki Free Zone and Kano Free Trade Zone
• Benefits: duty-free imports, tax holidays, 100% repatriation and simplified procedures

E. Sector-specific regulations

1. Food and agricultural products

• NAFDAC registration: mandatory for all food, drugs and chemicals
• SONCAP certification: for processed foods
• Quarantine services: for plants and animals
• Halal certification: required for meat imports
• Labelling requirements: NAFDAC number and manufacturing and expiry dates

2. Pharmaceutical products

• NAFDAC registration: a 12–18 month process
• GMP certification: required
• Clinical trials: may be required
• Price control: for essential medicines
• Distribution: through licensed channels

3. Automotive sector

• National Automotive Council approval: for CKD/SKD
• SONCAP certification: mandatory
• Age limit: maximum 15 years for used vehicles
• Emission standards: Euro 4 compliance
• Local content: encouraged through incentives

4. Electronics and electrical equipment

• SONCAP certification: mandatory
• Type approval: for telecom equipment (NCC)
• Energy efficiency: labels required
• Safety standards: international standards enforced
• Warranty: minimum 1 year required

5. Petroleum products

• DPR approval: Department of Petroleum Resources
• NNPC allocation: for crude swap deals
• Quality specifications: must meet Nigerian standards
• Storage requirements: licensed facilities only

F. Digital systems and automation

1. Nigerian Customs systems

• Nigeria Integrated Customs Information System (NICIS II): implemented in 2019 and ASYCUDA-based; covers all customs commands; electronic declaration and risk management; challenges include connectivity issues and partial adoption
• e-Customs platform: a Single Window under development; the Trade Portal for Form M processing; PAAR (Pre-Arrival Assessment Report) system; limited integration with other agencies

2. Mandatory electronic processes

1. Form M online: through trade.gov.ng
2. PAAR processing: electronic assessment
3. Duty payment: through the Remita platform
4. Cargo tracking: e-Call Up system for ports

3. Paper-based procedures are still significant

• Physical document submission is often required
• Multiple visits to customs offices
• Manual inspections are common
• Cash payments are still accepted at some locations

Trade agreements network

A. Regional agreements

1. ECOWAS Trade Liberalisation Scheme (ETLS)

• Coverage: 15 West African countries
• Benefits: duty-free, quota-free access for approved products
• Rules of origin: 60% local content minimum
• Challenges: limited implementation and documentation issues

2. African Continental Free Trade Area (AfCFTA)

• Status: ratified, with implementation ongoing
• Potential: access to a market of 1.3 billion people
• Implementation: Guided Trade Initiative under way
• Challenges: infrastructure, rules of origin and non-tariff barriers

B. Bilateral agreements

1. China: various economic cooperation agreements
2. United States: AGOA (African Growth and Opportunity Act) beneficiary
3. United Kingdom: UK–Nigeria Economic Development Forum
4. European Union: EU–Nigeria Economic Partnership Agreement (under negotiation)

C. Preferential schemes

• AGOA: duty-free access to the US for 6,500+ products
• EU Everything But Arms (EBA): duty-free, quota-free access for LDCs
• UK Developing Countries Trading Scheme: preferential access

Major trade infrastructure

A. Ports (annual tonnage)

B. Border crossing points

Land borders

• Seme Border: with Benin (the main West Africa route)
• Idiroko Border: with Benin
• Mfum Border: with Cameroon
• Mai’adua Border: with Niger
• Illela Border: with Niger

Border status

• Periodic closures for security or economic reasons
• Recent reopenings with new procedures
• Scanning systems being installed at major borders

C. Transport infrastructure

• Rail network: 3,500 km, with limited operational capacity
• Road network: 195,000 km, poorly maintained in many areas
• Airports: 32 airports, 5 of them international (Lagos, Abuja, Kano, Port Harcourt, Enugu)
• Pipelines: 5,000+ km, with frequent vandalism

D. Special economic zones

• Lekki Free Zone: a 16,500 hectare integrated zone
• Calabar Free Trade Zone: an early free zone
• Kano Free Trade Zone: a northern industrial zone
• Dangote Refinery Complex: the world’s largest single-train refinery
• Various oil and gas free zones

Emerging trends and future developments

A. Petroleum sector transformation

• Dangote Refinery: 650,000 bpd capacity, reducing imports
• Modular refineries: 20+ licensed, reducing illegal refining
• Petroleum Industry Act (2021): major sector reforms
• Gas development: the Decade of Gas initiative (2021–2030)

B. AfCFTA implementation

• National Action Plan: developing value chains
• AfCFTA Adjustment Fund: ₦75 billion allocated
• Export development: targeting regional markets
• Rules of origin: developing Nigeria-specific criteria

C. Digital economy growth

• National Digital Economy Policy: 2020–2030
• Fintech boom: Lagos as Africa’s fintech hub
• E-commerce: 25% annual growth
• Digital skills: the 3MTT programme (3 Million Technical Talent)

D. Agricultural revolution

• National Agricultural Technology Programme
• Anchor Borrowers Programme: smallholder financing
• Export expansion: non-oil export promotion
• Food security: reducing import dependence

E. Manufacturing renaissance

• Made in Nigeria for Export (MINEX) programme
• Automotive policy: developing local assembly
• Textile revival: backward integration in cotton
• Pharmaceutical manufacturing: local production incentives

F. Trade facilitation reforms

• Ports reform: Nigerian Ports Authority modernisation
• Single Window: implementation ongoing
• Customs modernisation: NICIS II upgrades
• Border management: new scanning systems

Key contacts and resources

A. Government agencies

1. Nigeria Customs Service (NCS): customs.gov.ng · Phone +234 1 271 6800-19 · Email helpdesk@customs.gov.ng · Customs Headquarters, Abuja
2. National Agency for Food and Drug Administration (NAFDAC): nafdac.gov.ng
3. Standards Organisation of Nigeria (SON): son.gov.ng
4. Nigerian Ports Authority (NPA): nigerianports.gov.ng

B. Business organisations

1. Manufacturers Association of Nigeria (MAN): manufacturersnigeria.org
2. Nigerian Association of Chambers of Commerce (NACCIMA): naccima.com
3. Lagos Chamber of Commerce and Industry (LCCI): lagoschamber.com
4. Nigerian Export Promotion Council (NEPC): nepc.gov.ng

C. Statistical and market resources

1. National Bureau of Statistics (NBS): nigerianstat.gov.ng
2. Central Bank of Nigeria (CBN): cbn.gov.ng
3. Trade office: trade.gov.ng
4. World Bank Nigeria trade portal: doingbusiness.org/nigeria

D. Practical guidance for traders

For exporters to Nigeria

1. Use experienced freight forwarders: essential for navigating the system
2. Document accuracy: errors cause major delays
3. Payment security: use confirmed letters of credit
4. Patience required: everything takes longer than expected
5. Local partnerships: highly recommended

For importers from Nigeria

1. Quality control: pre-shipment inspection recommended
2. Documentation: make sure all certificates are valid
3. Payment terms: flexible, depending on the relationship
4. Logistics planning: allow for port congestion

Economic impact and strategic position

A. Trade balance dynamics

• Oil dependency: 78% of exports come from crude petroleum
• Import intensity: heavy reliance on refined products and machinery
• Non-oil export growth: a slow but steady increase
• Regional trade: growing within the ECOWAS region

B. Global specialisation

1. Oil producer: the world’s 8th largest crude oil exporter
2. LNG exporter: the world’s 5th largest LNG exporter
3. Agricultural producer: a major cocoa, sesame and cashew exporter
4. Regional manufacturing hub: the largest market in Africa
5. Services growth: a fast-growing ICT and fintech sector

C. Competitiveness indicators

D. Challenges and vulnerabilities

1. Oil price volatility: a major impact on the trade balance
2. Infrastructure deficits: limitations in ports, roads and power
3. Foreign exchange constraints: multiple rates and scarcity
4. Security challenges: oil theft, piracy and terrorism
5. Bureaucratic hurdles: complex procedures and corruption
6. Regional instability: the impact of conflicts in the Sahel

Summary of Nigerian trade characteristics

1. Oil-dependent economy: 78% of exports come from crude petroleum
2. Import-intensive structure: heavy reliance on refined products and manufactured goods
3. Large domestic market: a population of 220 million, the largest in Africa
4. Regional trade hub: a major player in West African trade
5. Currency complexity: multiple exchange rates with controls
6. Bureaucratic challenges: complex procedures and documentation requirements
7. Infrastructure constraints: port congestion and poor transport networks
8. Reform momentum: ongoing trade facilitation and diversification efforts
9. AfCFTA opportunity: potential access to the continental market
10. Diversification drive: growing non-oil exports in agriculture and services

Need more detail? For more detailed information or a specific market intelligence question, contact us.

Note: this analysis is indicative of the state of Nigerian trade as of early 2024. The landscape continues to evolve, particularly in response to geopolitical changes, digital transformation and sustainability imperatives.