Limited Impact of US Trade War on Nigeria’s Economy, Says Economist Dr. Muda Yusuf

Dr. Muda Yusuf, a prominent economist, has suggested that the ongoing trade war between the United States and other countries, initiated by President Donald Trump, is unlikely to significantly affect Nigeria’s economy. Speaking in Lagos, Yusuf emphasized that Nigeria’s trade with the U.S. makes up only about 10% of its external trade, meaning the direct consequences would be minimal. In 2024, Nigeria’s total merchandise exports amounted to $50.4 billion, with exports to the U.S. valued at $5.7 billion.

Nigeria’s key exports to the U.S. include crude oil, petroleum gas, and nitrogenous fertilizers, while the U.S. primarily exports vehicles, wheat, and fuel to Nigeria. Despite the relatively small trade volume, Yusuf pointed out that the ongoing tariff war might indirectly impact Nigeria. One of the significant consequences of the trade conflict has been the U.S. decision to limit access to the African Growth and Opportunity Act (AGOA), which could reduce Nigeria’s trade opportunities with the U.S.

The economist also warned that the trade war and retaliatory tariffs could cause inflationary pressures in the U.S., potentially leading to disruptions in global supply chains. This may dampen the global growth outlook, potentially causing a decline in crude oil prices. Such a decline would likely affect Nigeria’s foreign reserves and government revenue, both of which are heavily dependent on oil exports.

However, Yusuf highlighted that there could be opportunities for Nigeria in this global trade reshuffling. As many countries involved in the trade war seek new bilateral trade partners, Nigeria could benefit by expanding its trade relationships with emerging economies and other nations looking to diversify their markets.

Source: Leadership