Economists Advocate Local Value Addition to Cut Imports

Economists in Nigeria are urging the government to develop local capacity for adding value to raw materials to reduce import costs and enhance the manufacturing sector. Dr. Paul Alaj, Chief Economist at SPM Professionals, highlighted Nigeria's heavy dependence on imported raw materials, which accounted for N3.53 trillion in the first half of 2025, a 19.7% increase from N2.95 trillion in the same period of 2024.

Dr. Muda Yusuf, Chief Executive of the Center for Promoting Private Enterprise, noted that local value addition could create jobs and ease pressure on foreign exchange. However, he cautioned that the costs associated with value addition could hinder competitiveness.

Prof. Nnanyelugo Martin Ik Muonso from the Raw Materials Research and Development Council emphasized the need for a minimum of 30% local processing of raw materials for export to boost job creation and GDP. The Nigerian Senate has passed an amendment bill requiring this minimum value addition for raw materials exported from Nigeria.