Nigeria and EU: A trade partnership with untapped potential

By Gautier Mignot

The European Union remains Africa’s first trade and investment partner. Around 33 per cent of Africa’s total trade in goods is with the EU, and Europe remains the main destination for African exports. European companies are also the largest foreign investors on the continent, with EU investment stock in Africa worth more than EUR 250 billion in 2024.

These are not just impressive figures. They point to a relationship of depth, resilience and long duration. Nigeria is central to that relationship.

The European Union has long been committed to providing preferred access for African goods. This year, the European Union celebrates 25 years of Everything But Arms (EBA) and 55 years of the Generalised Scheme of Preferences (GSP), the two preferential trade regimes supporting African exports to Europe.

Nigeria is not a beneficiary of EBA. That arrangement is reserved for Least Developed Countries and provides duty-free, quota-free access to the EU market for all goods except arms. Nigeria benefits instead from the GSP, which is part of the wider EU framework of trade preferences for developing countries.

For decades, through GSP and EBA alike, the European Union has chosen to open its market wide to developing partners. This year, the EU extended the GSP for another decade, with the new rules applying from 1 January 2027.

In a turbulent world, that is an important signal: it says that Europe remains committed to a trade relationship with developing partners that is generous, stable and predictable. At a time when global trade is becoming more fragmented, more uncertain and more transactional, that matters more than ever.

Other trading partners have recently moved in a similar direction with their market access offers to Africa, but the EU still stand out for the breadth, longevity and predictability of its trade preferences for African countries.

For 55 years now, the Generalised Scheme of Preferences has allowed beneficiary countries to export to the European market with reduced or zero tariffs on a wide range of goods. In 2024 alone, GSP beneficiary countries received an estimated EUR 5 billion in tariff savings.

Nigeria has already been making real use of this opportunity. Between 2022 and 2024, EU imports from Nigeria using GSP preferences totalled EUR 372.4 million, making Nigeria the largest user of GSP preferences among the non-EBA African beneficiaries. Nigeria’s utilisation rate of 70 per cent is encouraging. It shows that Nigerian businesses are already taking advantage of the scheme in meaningful ways.

But it also shows there is room to go further and fully exploit the opportunities under the GSP.

That matters because Nigeria’s long-term economic future depends on diversification. It depends on creating more value at home, strengthening manufacturing, expanding agro-processing, supporting small and medium-sized enterprises, and generating more decent jobs, especially for young people. It also depends on building the conditions that allow Nigerian businesses to move further up the value chain and become more competitive, not only in the region but globally.

Trade preferences alone cannot achieve all that, but they are important because they contribute to a predictable environment for investment. Economic transformation depends above all on domestic leadership, reforms, infrastructure, skills and a supportive business climate. But trade preferences can help. They can lower the cost of entering international markets, make investment decisions easier, and encourage firms to think in terms of scale.
For Nigeria, this is not a marginal advantage. It is a strategic one.

When I look at Nigeria, I see one of Africa’s most important economies, but I also see one of its most promising. I see talent, ambition and entrepreneurial drive on an exceptional scale. I see a country with every reason to play a larger role in regional and global value chains. And I see a partnership with Europe that is already strong, but still far from reaching its full potential.

I am therefore very pleased that Nigeria decided last year to launch a Trade and Investment Dialogue with the European Union, to discuss exactly how to reap the full benefits of this relationship. Two editions of this Dialogue have already taken place and 2027 should be a year to decisively bring the EU-Nigeria economic partnership forward.

Mignot is the Ambassador of the European Union to Nigeria and to the ECOWAS.