.Says Nigeria should consolidate economic gains, not undermine them
.Calls for expansion of domestic production capacity
.Dangote Refinery can supply Nigeria enough petroleum products – Dr Muda Yusuf
The Centre for the Promotion of Private Enterprise (CPPE) has expressed strong reservations about the policy proposition by the World Bank in its recent Nigerian Development Update, advocating increased importation of petroleum products and food as a solution to Nigeria’s supply-side constraints.
This position was canvassed by the Chief Executive Officer of CPPE, Dr Muda Yusuf, noting that the World Bank recommendation is deeply troubling and fundamentally misaligned with Nigeria’s current economic realities and reform trajectory.
He argued that at a time when the Federal Government is making measurable progress in restoring macroeconomic stability—evidenced by improving foreign reserves, moderating inflation, a more stable exchange rate regime, and growing capacity for the export of refined petroleum products—the policy priority should be to consolidate these gains, not undermine them.
Nigeria is gradually transitioning towards greater self-sufficiency in petroleum products supply, driven by significant private investments in domestic refining capacity. This momentum should be strengthened through deliberate policies that support local production, enhance value addition, and deepen industrial linkages within the economy.
He further argued that encouraging increased importation of petroleum products at this stage risks reversing hard-won gains. “It would exacerbate foreign exchange pressures, weaken domestic refining investments, and heighten the economy’s vulnerability to external shocks—particularly in a global environment characterized by geopolitical tensions and energy market volatility.
“The emphasis, therefore, should be on expanding and stabilizing 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.”
The organization explained that sustainable economic transformation is anchored on production, value addition, and industrial capability not import dependence.
“What the Nigerian economy urgently requires is a coherent industrial strategy that: expands domestic production capacity; strengthens manufacturing competitiveness and deepens value chains across critical sectors.
Dr Yusuf maintained that import-driven solutions risk accelerating de-industrialisation, weakening the real sector, and undermining job creation prospects in an economy with a rapidly growing labour force.
“The assumption that trade liberalisation enhances competition fails to reflect the structural realities facing Nigerian producers.”
He pointed out that domestic firms contend with: poor logistics and transport infrastructure; high energy costs; elevated financing costs, with lending rates often exceeding 25–30% and multiple taxation, fees, and regulatory burdens.
“In this context, the notion of “competition” between imports and domestic production is both misleading and inequitable. 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—characterised by elevated energy costs, logistics bottlenecks, infrastructure deficits, high interest rates, and policy uncertainties—while many foreign competitors benefit from far more enabling ecosystems, including state-backed subsidies, efficient infrastructure, and lower financing costs.
“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.
“Beyond the issue of structural imbalance, there are also legitimate concerns around the quality of imported petroleum products and the risk of dumping. In the absence of robust quality assurance and trade safeguards, the domestic market could be exposed to substandard products, with implications for consumer protection, environmental standards, and the sustainability of local refining investments.
“A policy stance that tolerates such distortions not only weakens domestic industry but also compromises Nigeria’s long-term objective of achieving energy security, industrial self-reliance, and sustainable economic growth.”
Yusuf stressed that sustainable competition should be fostered within a strengthened domestic industrial ecosystem, not through exposure to import pressures.
“The risks of import dependence are most evident in the energy sector. Nigeria’s historical reliance on imported petroleum products: led to the collapse of domestic refining capacity; created a rent-seeking import regime with significant leakages; imposed an annual import burden estimated at $10–15 billion at its peak and exposed the economy to severe foreign exchange and fiscal pressures
He added that recent developments in domestic refining—particularly the operationalisation of Dangote Refinery—have demonstrated Nigeria’s capacity to achieve self-sufficiency in petroleum products, subject to supportive policy frameworks.
Furthermore, he pointed out that the ongoing geopolitical tensions in the Middle East have further underscored the dangers of energy dependence.
“Global supply disruptions are quickly transmitted into domestic price shocks, amplifying inflationary pressures and eroding business margins.
He suggested that the desired policy direction is therefore Nigeria needs expansion of domestic refining capacity—not more import licences for petroleum products.
He noted that encouraging importation at this stage would undermine investor confidence in local refining, weaken backward integration, and reverse progress towards energy security,” he added.
Dr Yusuf argued that excessive food importation is equally compelling and discourage investment in agriculture
“Nigeria’s food security strategy must be anchored on boosting domestic agricultural productivity, strengthening value chains, and improving market access, not on reliance on external supply channels.”
