Nigeria’s economy may witness a fresh downturn if President Donald Trump of the United States (US) goes ahead to impose an extra 10 per cent tariff on countries aligning with the BRICS. The proposed extra tariff is expected to take effect from August 1, 2025. Countries in the BRICS bloc include Brazil, Russia, China and South Africa. Nigeria became a partner of the BRICS in January this year. President Bola Tinubu attended its recent meeting in Rio de Janeiro, Brazil, and called for more cooperation among the group to enhance global trade.
The new tariff will bring Nigeria’s import duties to the US to 24 per cent. Earlier, Trump’s executive order on April 2, slammed Nigeria and other selected countries in, with 14 per cent levy to bridge the trade surplus with America. The 10 per cent extra tariff could further dampen Nigeria’s export diversification drive. Already, Nigeria/US exports relations have plummeted since Trump’s inauguration in January.
The US Census Bureau and the Bureau of Economic Analysis revealed that the US imports of Nigerian goods decreased by $527 billion from January to May 2025, compared to the same period in 2024. This represents about 20 per cent year-on-year decline amid recent bilateral trade tensions between the two nations. The visa row between the US and Nigeria may have worsened the situation.
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Available statistics show that, in the corresponding period of 2024, the US imported goods from Nigeria worth $2.6 billion. It sadly dropped to $2.12 billion between January and May. However, energy-related products, including crude oil, are exempted from the tariffs. Despite Nigeria being one of America’s largest trade partners, the impact of Trump’s latest trade policies may hit Nigeria hard. There is no doubt that Trump intends to use the tariff policy to boost US economy and encourage US consumers to patronise more made-in-America goods, increase taxes and attract investors to America.
Economic experts predict that, with Nigeria’s improved Gross Domestic Product (GDP), Trump’s economic policies against some countries in the G-7 and European Union (EU) could upend global economy and lead to global recession. According to the World Trade Organisation (WTO), the development will reduce the world’s GDP by 7 per cent. Going forward, the 14 per cent tariff on Nigerian goods means that a $10 product will attract $1.40 tax on top, raising the total price of the product to $11.40. The 14 per cent tariff on Nigerian exports marks a significant change in the trade dynamics between both countries.
In effect, companies that bring such goods to the US will pay the extra tax to the US government. The final consumers will bear the extra cost. The National Bureau of Statistics (NBS) recently revealed that Nigeria’s trade with the US totaled N31.1trillion between 2015 and 2024. Total imports within the period stood at N16.4trillion, or 8.7 per cent. This means that Nigeria is at the receiving end of Trump’s new tariffs. Trump’s new tariff policy may put the Nigerian economy on a tailspin and disrupt trade relations, as well as weaken the competitiveness of Nigerian products in the US market.
Apart from lowering the profit of Nigeria’s exports to US, Trump’s policy will weaken the value of the naira. Since the introduction of Tinubu’s inimical economic policies, the naira has not fared any better. It has affected our earnings from crude oil, our major export. Although Nigeria’s exports to the US averaged $5.5billion annually in the last two years, it should serve as a wake-up call for government to aggressively boost our non-oil sector by enhancing the quality and packaging of Nigerian exports in line with global standards. Doing this will increase their acceptability in international market.
It is time to reignite the goals of African Continental Free Trade Zones (AfcFTA) agreement, which includes enabling free flow of goods and services across the continent and boosting the trading position of Africa in the global market and eliminate barriers in African trade. We support the position of the African Union (AU) on the need for the continent to take a united stand in response to Trump’s tariff threat.
For Nigeria, we believe Trump’s fresh tariff threat offers us a golden opportunity to look inwards on how to make the country less dependent on foreign goods. Indeed, this is the right time to deepen the diversification of the economy and fast-track the recently launched ‘Nigeria First’ policy, which is aimed at prioritising ‘made-in-Nigeria’ goods, promoting our exports as well as investing in the people, agriculture and manufacturing. Let the state governments use their agricultural potential to lead the new drive to diversify the economy by mass producing cash/food crops they have comparative advantage. We say this because the future of Nigerian economy depends so much on agriculture and manufacturing.
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