A leading private sector advocacy organisation has thrown down the gauntlet before the federal government, urging it to double down on expanding domestic refining capacity and firmly reject advice from the World Bank that Nigeria should lean on increased importation of petroleum products and food to address its supply side challenges.
The Centre for the Promotion of Private Enterprise made its position known in a strongly worded press statement, expressing deep reservations about recommendations contained in the World Bank’s recent Nigerian Development Update, which prescribed greater reliance on imports as a remedy for Nigeria’s production constraints.
The CPPE described the prescription as fundamentally at odds with the country’s current economic realities and the reform direction the government has been pursuing.
“Import Liberalisation Is Not a Sustainable Solution”
Chief Executive Officer of the CPPE, Dr. Muda Yusuf, was unambiguous in his rejection of the World Bank’s position, warning that opening Nigeria’s doors wider to imports would create far more problems than it solves.
“Import liberalisation is not a sustainable solution to Nigeria’s supply side challenges. On the contrary, it risks deepening structural vulnerabilities, accelerating deindustrialisation and exposing the economy to greater external shocks,” he said.
Yusuf argued that Nigeria’s development path must instead be built on a production driven growth model, one that is anchored on strong domestic refining capacity, a competitive manufacturing sector, robust agricultural systems and the achievement of both energy and food security.
He said the country’s policy momentum should be channeled toward consolidating the measurable progress already made in transitioning toward greater self sufficiency in petroleum products, a transition that has been driven largely by significant private sector investments in domestic refining infrastructure.
Pushing further importation of petroleum products at this stage, he warned, would risk reversing hard won gains, pile additional pressure on foreign exchange reserves, weaken investor appetite for domestic refining and leave the economy more exposed to external shocks at a time when geopolitical tensions and energy market volatility are already elevated concerns globally.
“The emphasis should be on expanding and stabilising domestic production capacity, ensuring reliable crude supply to local refineries on competitive terms and fostering an enabling environment for downstream sector investments. This is the pathway to sustainable energy security, economic resilience and long term industrial development, not a return to import dependence,” Yusuf said.
An Uneven Playing Field
The CPPE took particular issue with the assumption embedded in the World Bank’s recommendation that increased imports would stimulate healthy competition and ultimately benefit Nigerian consumers. Yusuf said that framing fails to account for the structural realities that Nigerian producers contend with daily.
He listed poor logistics and transport infrastructure, punishingly high energy costs, financing rates that regularly exceed 25 to 30 per cent, multiple layers of taxation, fees and regulatory burdens as conditions that place domestic operators at a severe disadvantage relative to foreign competitors who benefit from state backed subsidies, efficient infrastructure and far lower costs of doing business.
“What is being presented as market competition is, in reality, a structural asymmetry that places domestic producers at a significant disadvantage. Nigerian refiners and other manufacturers operate in a high cost environment while many foreign competitors benefit from far more enabling ecosystems. This is not a level playing field. It is effectively a contest between structurally constrained local investors and globally competitive firms with systemic advantages. Such a framework cannot deliver efficient market outcomes; rather, it undermines domestic capacity, discourages investment and perpetuates import dependence,” he said.
Yusuf also flagged concerns about product quality, warning that in the absence of robust quality assurance frameworks and adequate trade safeguards, opening Nigeria’s market to more petroleum product imports could expose consumers to substandard goods while simultaneously undermining the sustainability of local refining investments.
The Energy Sector Warning
Yusuf said the risks of import dependence are perhaps nowhere more clearly illustrated than in Nigeria’s own energy sector history. He noted that decades of reliance on imported petroleum products contributed directly to the collapse of domestic refining capacity and gave rise to a rent seeking import regime that imposed an annual burden on the country estimated at between $10 billion and $15 billion at its peak.
Against that backdrop, he said recent strides in domestic refining, most notably the operationalisation of the Dangote Refinery, have demonstrated that Nigeria is capable of achieving self sufficiency in petroleum products given the right policy environment. Ongoing geopolitical tensions in the Middle East, he added, have served as a timely reminder of just how dangerous sustained energy dependence can be.
“Encouraging importation at this stage would undermine investor confidence in local refining, weaken backward integration and reverse progress towards energy security,” he said.
Food Security Cannot Be Imported
The CPPE extended the same logic to the agricultural sector, arguing that the case against excessive food importation is equally compelling. The group said that flooding the market with food imports depresses the prices that farmers receive for their produce, discourages investment in agriculture, erodes rural incomes and weakens the overall resilience of Nigeria’s food systems.
Yusuf said Nigeria’s food security strategy must instead be built on boosting domestic agricultural productivity, strengthening value chains and improving market access for local producers rather than outsourcing food supply to external channels.
He described it as paradoxical and deeply concerning that the World Bank is urging Nigeria toward policy prescriptions that many advanced economies are themselves stepping back from. He noted that across the developed world, there is a clear and growing resurgence of strategic protectionism and supply chain reconfiguration, lessons drawn from the disruptions of the global pandemic and ongoing geopolitical instability.
“Recommending import liberalisation for countries still grappling with structural deficits and industrial fragility risks entrenching dependence, undermining local capacity and stalling the industrialisation process,” he said, calling on the World Bank to redirect its advisory efforts toward reforms that promote industrialisation rather than import expansion.
What Nigeria Actually Needs
In place of the World Bank’s recommendations, the CPPE outlined a set of priorities it said would deliver genuine and sustainable results. These include expanding domestic refining capacity and guaranteeing crude supply to local refineries, targeted interventions to reduce production costs particularly in energy and logistics, and the development of stronger manufacturing ecosystems and industrial clusters.
The group also called for enhanced agricultural productivity and agro-processing value chains, action on the structural bottlenecks holding back private sector output, and greater emphasis on backward integration and local content development across key sectors.
“These are the policy pathways that will deliver sustainable growth, job creation and economic resilience,” Yusuf concluded.
