The Traffic

Global trade tension over fresh US 10% tariff hike on Nigeria, BRICS nations

The United States has imposed a new 10% tariff on goods exported from Nigeria and other countries aligning with the BRICS economic bloc, according to President Donald Trump. This move aims to protect US interests amid a shifting global economic order.

By Rhalialt Arhuoizah 

*What's behind the tariff?*

- Trump's administration views BRICS policies as "anti-American" and seeks to counter their influence.
- The BRICS bloc, comprising Brazil, Russia, India, China, South Africa, and newer members like Egypt, Ethiopia, Indonesia, Iran, and the UAE, promotes economic cooperation and challenges Western-dominated institutions.

*Impact on Nigeria*

- The additional 10% tariff could exacerbate Nigeria's economic challenges, including inflation and a weakening naira.
- Nigeria's exports to the US, such as crude oil, agricultural products, and manufactured goods, may become less competitive due to the increased tariff.
- The government plans to seek a resolution through the World Trade Organisation (WTO) to mitigate the impact .

*Potential Consequences*

- *Trade Diversion*: Nigeria might redirect shipments to other markets in Europe, Asia, or within the African Continental Free Trade Area (AfCFTA).
- *Economic Diversification*: The tariff could encourage Nigeria to diversify its economy and reduce reliance on crude oil exports.
- *Strained US-Nigeria Relations*: The move may affect Nigeria's trade relations with the US, potentially impacting benefits from the African Growth and Opportunity Act (AGOA) .