Trump’s tax reforms might scale back International Direct Funding in Nigeria – NESG warns 

The Nigerian Financial Summit Group (NESG) has raised issues that U.S. President Donald Trump’s tax reforms might result in a discount in International Direct Funding (FDI) in Nigeria.

In line with NESG’s report titled Trump’s Coverage Playbook: Strategic Implications For Nigeria, launched in February 2025, Trump’s tax insurance policies might encourage U.S. corporations to repatriate investments, thereby lowering capital inflows into Nigeria.

In line with NESG, “Trump’s tax reforms might encourage U.S. corporations to repatriate investments, lowering FDI in Nigeria. To counter this, Nigeria ought to appeal to traders from China, the EU, and Gulf nations by enhancing its funding local weather.” 

The report highlighted that Nigeria should proactively appeal to traders from various markets reminiscent of China, the European Union (EU), and Gulf nations by enhancing its funding local weather.

Potential Commerce Disruptions and the AGOA Uncertainty 

NESG additional famous, “Nigeria, as one in every of Africa’s largest economies, faces potential commerce disruptions resulting from elevated U.S. protectionism. Tariff hikes on key commodities may reshape world provide chains and disrupt worldwide commerce. The way forward for AGOA, set to run out in September 2025, stays unsure beneath Trump’s second time period, particularly given his much less deal with Africa throughout his first time period. Nevertheless, if AGOA is renegotiated or its advantages diminished, it may affect commerce in Nigeria, because the US stays one of many nation’s high 5 export locations for oil and agricultural merchandise.” 

NESG’s report additionally factors out that potential tariff hikes and commerce restrictions may create important challenges for Nigerian companies exporting to the U.S. market. Industries depending on exports to the U.S., reminiscent of oil, cocoa, and textiles, might endure income losses if stricter commerce insurance policies are carried out.

Outlook and Strategic Suggestions 

To mitigate the dangers posed by Trump’s financial insurance policies, NESG recommends that Nigeria diversify its commerce partnerships, improve its manufacturing capabilities, and implement insurance policies that assist native industries. Strengthening ties with Asian and European markets, whereas fostering intra-African commerce beneath the African Continental Free Commerce Space (AfCFTA), may function a buffer in opposition to potential financial shocks.

• With world commerce dynamics shifting, Nigeria should place itself strategically to navigate uncertainties and maintain financial development amid evolving U.S. insurance policies.
• The NESG notes that the affect of U.S. commerce insurance policies on Nigeria is basically oblique, formed by world market responses somewhat than direct bilateral results.

From a typical commerce concept perspective, tariffs act as taxes on imports, elevating their home costs, the NESG famous.