The Centre for the Promotion of Private Enterprise (CPPE) has cautioned against renewed advocacy for unrestricted petroleum product imports at a time when Nigeria should consolidate domestic refining capacity to safeguard industrialisation and economic sovereignty.
In a statement titled, ‘Import Liberalisation and the Risks of Deindustrialisation in Nigeria,” the director/CEO of CPPE, Dr. Muda Yusuf urged that the ongoing discussion reflects broader economic philosophies critical for Nigeria’s industrialization and economic sustainability.
He stated, “this conversation extends beyond petroleum products and touches upon the foundation of Nigeria’s economic structure, the future of our industrial base, and ultimately, the integrity of our economic sovereignty. History shows that no nation has achieved industrial success through excessive reliance on imports.”
According to Yusuf, prosperous economies thrive on production, refining, manufacturing, value addition, and reinforcing local capacity. Over-reliance on imports can lead to job loss, weakened industries, diminished local investments, and compromised economic sovereignty. Therefore, Nigeria should strive to maintain policies that support domestic production while fostering healthy competition.
Yusuf pointed out that decades of dependence on imported petroleum products have led to significant economic distortions, including pressure on foreign reserves, depreciation of the naira, the decline of domestic refineries, and challenges related to foreign exchange liquidity and corruption in the subsidy system.
He noted that the country spent trillions of naira annually subsidizing imported fuel during the height of the subsidy era, transferring valuable resources and opportunities abroad.
He cautioned that excessive import dependence put Nigeria’s foreign exchange market at risk before recent administrations implemented reforms to restore stability and rebuild investor confidence.
“Recreating previous conditions that weakened our economy would be economically unwise,” he stated.
Yusuf highlighted the approaches taken by other nations such as the United States, which uses tariffs and industrial subsidies to strengthen manufacturing, and countries like China, Europe, and India, which prioritize support for their domestic industries.
He noted, “industrialization thrives on smart policy interventions rather than extreme liberalization. Countries do not grow by solely welcoming imported goods.”
Yusuf addressed concerns about Dangote Refinery, asserting that characterizing it as a monopolistic threat is overly simplistic.
He emphasized that the refinery has not deterred other investors from the sector and that its establishment represents a monumental industrial investment, unmatched in Africa.
He further noted that Nigeria should embrace bold investments that reflect industrial courage and risk-taking. Undermining such transformative initiatives could send negative signals to both domestic and foreign investors.
Highlighting Nigeria’s experiences with food importation, Yusuf illustrated “the adverse effects that excessive liberalization can have on local agricultural value chains, farmers’ incentives, and investment in domestic production.
“While imports may temporarily moderate prices, he stressed that meaningful industrialization can only be achieved through dedicated and sustained support for local production.”
