The newly introduced 14% tariff on Nigerian exports by US President Donald Trump poses a major threat to the $10 billion annual trade between Nigeria and the United States, with potential disruptions in oil and agricultural exports, experts and trade associations warned on Thursday.
According to The Punch, economic analysts said that the policy could increase consumer prices, weaken living standards, slow down manufacturing, and reduce demand for Nigerian oil in the US—one of its key export destinations.
The Nigerian-American Chamber of Commerce (NACC) expressed concerns over the policy, highlighting that since the inception of the African Growth and Opportunity Act (AGOA) in 2000, Nigeria had exported approximately $277 billion worth of goods to the US, with crude oil accounting for the bulk of this trade.
Nigeria’s exports to the US currently range between $10 billion and $12 billion annually, though figures have fluctuated in recent years.
Trump, in a widely criticized move, announced that countries exporting to the US could now face tariffs as high as 50%. Speaking at a ‘Make America Wealthy Again’ event, he described the new 10% minimum tariffs as part of a broader strategy to rebalance global trade and counter perceived unfair practices.
According to the Trump administration, Nigeria imposes a 27% tariff on US exports, a disparity seen as harmful to American businesses.
Our correspondent gathered that the reciprocal tariff rate was determined by the US trade deficit with each country, divided by total imports from that country, and then halved.
Trump framed the policy as a move to protect American industries and enforce what he termed “fair” trade rules.
“This is one of the most important days in American history,” Trump said. “We will supercharge our domestic industrial base, pry open foreign markets, and break down trade barriers.”
In response, Sheriff Balogun, President of NACC, warned that the policy could impact $277 billion worth of trade, with crude oil exports particularly vulnerable.
Economic analysts argue that the move threatens Nigeria’s crude oil exports, which form the backbone of its economy. A decline in oil sales could further weaken the naira, raise inflation, and increase costs for imported goods like wheat and vehicles.
According to Afreximbank research, the 14% tariff is expected to reduce oil demand and forex earnings, while increased tariffs on goods such as wheat and vehicles could drive up local prices.
Nigeria’s primary exports to the US include crude petroleum, petroleum gas, nitrogenous fertilizers, cocoa, rubber, and refined lead, while key imports from the US include cars, refined petroleum, and wheat.
The National Bureau of Statistics (NBS) reports that Nigeria’s trade with the US reached N31.1 trillion over the past ten years (2015–2024), with exports totaling N16.4 trillion and imports at N14.71 trillion, reflecting a trade surplus of N1.64 trillion.
The tariffs come as the US begins importing jet fuel from Nigeria’s Dangote Refinery, with six vessels carrying 1.7 million barrels arriving this month.
However, Johnson Chukwu, CEO of Cowry Asset Management Limited, noted that crude oil exports might not be directly impacted, as Trump has exempted energy products, including crude oil, copper, and gold, from tariffs.
Chukwu warned that the broader US trade war could reduce global production, indirectly lowering crude oil demand and prices, which could affect Nigeria’s projected revenue.
Muda Yusuf, CEO of the Centre for Promotion of Private Enterprises, emphasized that the AGOA trade window has essentially been closed by Trump’s administration, with potential inflationary pressures in the US affecting import costs for Nigeria.
Despite the concerns, Yusuf suggested that the shift in global trade could open up new bilateral trade opportunities for Nigeria. However, if US inflation worsens, the Federal Reserve may implement tighter monetary policies, leading to higher interest rates and capital outflows from emerging markets, which could further weaken the naira.
Sola Obadimu, Director General of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), advised the Nigerian government to focus on domestic economic growth rather than overreacting to US policies.
He noted that Trump’s ‘America First’ agenda aims to revive domestic industries and create jobs by discouraging imports.
“Trump’s goal has always been to make America great again by reviving factories and jobs. Many US factories have shut down due to outsourcing, and this policy is meant to reverse that trend,” Obadimu said.
He urged Nigeria to prioritize industrialization and job creation, stressing that the country relies too heavily on crude oil and raw agricultural exports rather than adding value to its products.
“We cannot industrialize on generators. We should aim for 150,000 megawatts of electricity, add value to our products, and employ more people,” he added.
Trump’s new tariffs take effect immediately, with a baseline 10% tariff on all US imports and higher rates for over 50 countries, including China (34%), India (26%), South Korea (25%), the UK (10%), Brazil (10%), and Vietnam (46%).
For African nations, Algeria faces a 30% tariff, Lesotho 50%, Mauritius 40%, Kenya 10%, Namibia 21%, Ethiopia and Ghana 10%, and South Africa 30%.
Trump announced that the 10% baseline tariffs would begin on April 5, while higher rates on select countries would take effect from April 9.
This shift in US trade policy has rattled global markets and fueled fears of a trade war, with experts predicting economic disruptions worldwide.