Tinubu’s Economic Team Brainstorm on Global Meltdown, 14% Trump Tariff
The Federal Government is taking proactive measures to mitigate the potential impact of the 14% tariff imposed by US President Donald Trump on the country’s non-mineral exports.
The Economic Management Team, led by Finance Minister Wale Edun, is set to convene to discuss strategies for enhancing non-oil revenue and reducing the country’s reliance on crude oil exports.
The 14% tariff, part of Trump’s broader trade policy, poses a significant threat to Nigeria’s economy, which depends heavily on crude oil for about 90% of its foreign exchange earnings. The tariff could lead to a decline in Nigeria’s non-mineral exports to the US, which could have a ripple effect on the country’s economy.
However, the government sees an opportunity to diversify its economy and reduce its dependence on oil exports
According to Edun, the impact of the tariff could be minimal if Nigeria sustains its oil and mineral export volumes. To achieve this, the government plans to intensify non-oil revenue mobilization through agencies like the Federal Inland Revenue Service and Nigeria Customs Service. The government will also make budget adjustments and explore innovative financing options to mitigate the effects of the tariff.
The Economic Council’s meeting aims to reassess the 2025 budget assumptions, which are pegged at a $75 per barrel oil benchmark. The government will devise measures to mitigate any adverse effects, such as an oil price drop, by ramping up crude production and diversifying exports.
This response aligns with Nigeria’s broader push to reduce oil dependency and enhance intra-African trade via the African Continental Free Trade Area (AfCFTA).
The government’s strategy to diversify the economy includes promoting non-oil sectors such as agriculture, manufacturing, and services. The government plans to provide incentives for investors, improve infrastructure, and enhance the business environment to attract investment in these sectors.
By diversifying the economy, Nigeria can reduce its reliance on oil exports and mitigate the impact of external shocks such as the US tariff.
The African Continental Free Trade Area (AfCFTA) provides a significant opportunity for Nigeria to enhance intra-African trade and reduce its dependence on oil exports. The AfCFTA aims to create a single market for goods and services in Africa, with a combined GDP of over $3 trillion.
By leveraging the AfCFTA, Nigeria can increase its trade with other African countries, promote economic growth, and reduce poverty.
The government plans to explore innovative financing options to support the diversification of the economy. This includes partnering with private sector investors, development finance institutions, and international organizations to provide funding for key sectors such as infrastructure, agriculture, and manufacturing.
The government will also leverage technology to improve revenue collection, reduce corruption, and enhance transparency in governance.
