UK and Nigeria have had a long trade and investment relationship that has not attained its full potential because of a number of constraints, including a challenging business environment, high transport costs and logistics challenges.
The UK accounted in 2017 for 2.7% of total goods exports from Nigeria and 3.8% of total imports in Nigeria. Nigeria’s exports are undiversified: oil and gas alone represent 95% of exports. Nigerian imports from the UK are more diversified than its exports to the UK. Refined oil represents 14% of Nigerian imports from the UK.
Based on Nigeria’s exports to other Organisation for Economic Co-operation and Development countries, we identify some opportunities in cocoa, sesame seeds, rubber, and ginger. These are products that the UK is importing from other countries but it is importing either little or none at all from Nigeria.
The UK accounts for 9% of Nigerian services exports (second export complex after oil and gas), primarily in the form of exports of travel, transportation, and other business services. Meanwhile, Nigeria represents less than 1% of UK services exports, explained also by exports of travel, transportation, and other business services.
Data on foreign direct investment are patchy. Using data on investment announcements made by companies, in 2018 the UK was the third-largest investor in Nigeria. Nigeria is the second-largest destination for UK investment in Africa, with 98% of this investment in the oil and gas sector.
In the report of this study commissioned by Policy Development Facility II, Max Mendez-Parra, Neil Balchin, Linda Calabrese and Kingsley Onyeka explores the diagnostic, identification of constraints and recommendations on the Nigeria and UK bilateral trade and investment.
Click the links to read the full report.