Despite Nigeria posting an impressive 78.07% year-on-year growth in non-oil exports in the first quarter of 2025, trade analysts and industry stakeholders say the official figures fail to capture the full picture largely due to widespread informal cross-border trading and bureaucratic bottlenecks in the formal export process.
Data from the National Bureau of Statistics (NBS) shows that non-oil exports rose from ₦1.78 trillion in Q1 2024 to ₦3.17 trillion in Q1 2025, representing 15.38% of total exports, a significant jump from 9.28% the previous year. This reflects a growing effort to diversify Nigeria’s economy away from its heavy reliance on crude oil.
Since Q3 2023, when non-oil exports stood at ₦677.57 billion, the sector has shown consistent growth for six straight quarters. In Q1 2025, agricultural exports led the non-oil category with ₦1.7 trillion, while manufactured goods exports reached ₦294.43 billion.
Behind the Numbers: A Different Reality?
However, despite the reported gains, many experts argue that the data severely underrepresents the actual volume of goods leaving the country especially across land borders due to informal and undocumented trade.
Nigeria’s exports to African countries dropped by 9.19% in Q1 2025, falling from ₦2.04 trillion in Q4 2024 to ₦1.85 trillion. But analysts believe this apparent decline is not due to reduced trade volumes but rather poor documentation and tracking of informal transactions, particularly by small and medium-sized exporters.
“Most of our non-oil exports are informal, especially within the West African subregion,” said Dr. Muda Yusuf, Director of the Centre for the Promotion of Private Enterprise (CPPE). “They are simply not recorded.”
According to Yusuf, over 50% of non-oil exports are informal and fall outside national data reporting systems. He explained that large firms and major commodity traders typically show up in the statistics, but the vast number of small-scale exporters especially those trading through land borders remain invisible.
Bureaucracy and Border Bottlenecks
Yusuf attributes the informal nature of trade to the complexity and high cost of Nigeria’s export documentation process.
“The current documentation system is too slow and costly. A small trader producing in Oyo State can’t afford the time or money to travel to Ibadan for customs paperwork before moving goods through Seme,” he noted.
According to him, unless the government simplifies export processes, reduces documentation requirements, and decentralizes customs procedures, informal trade will continue to thrive unchecked.
He also highlighted the impact of limited border access, noting that only a few points such as Seme and Maradi are currently open, while many others remain closed, inadvertently encouraging illicit trade routes.
“Most traders just can’t wait. They move fast and need systems that match that pace,” he added.
NEPC Flags Billions in Unrecorded Exports
The Nigerian Export Promotion Council (NEPC) confirmed the scale of untracked exports. In 2024 alone, the agency recorded $31.8 million worth of unrecorded exports through informal channels, according to its Executive Director/CEO, Nonye Ayeni.
The data was gathered across key export corridors in Kano, Jigawa, Katsina, Zamfara, Sokoto, Lagos, Ogun, Adamawa, and Kebbi. NEPC has since signed an MoU with the NBS to improve the tracking and documentation of informal cross-border trade.
Ayeni stressed that informal exports are not marginal activities but represent a vital part of the economy:
“They support livelihoods, strengthen regional supply chains, and contribute significantly to national and continental economic resilience.”
A Longstanding Challenge
The issue is not unique to Nigeria. A 2022 Free Trade Nigeria report citing the Global Initiative Against Transnational Organized Crime estimated that 30–40% of intra-SADC trade is informal, valued at $17.6 billion. In West Africa, informal trade is even more pronounced, contributing up to 50% of GDP and 90% of employment in some countries like Benin Republic.
Smuggling Clouds the Export Landscape
Yusuf also raised the alarm over growing incentives for fuel smuggling due to price disparities across borders. With petrol prices in Benin Republic reaching ₦1,500 per litre, compared to ₦900–₦1,000 in parts of Nigeria, the profitability of smuggling has soared.
“Smuggling shouldn’t be classified as exports, but it further complicates the challenge of accurately tracking trade flows,” he said.
LCCI: Informal Trade Not Going Away Soon
President of the Lagos Chamber of Commerce and Industry (LCCI), Gabriel Idahosa, echoed Yusuf’s concerns. He confirmed that informal trade has been entrenched in Nigeria’s economy for decades and is unlikely to vanish without major structural changes.
“Many small ports and unofficial corridors are used to export goods to countries like Equatorial Guinea, São Tomé, and Príncipe. Most of this trade is undocumented,” he explained.
He added that future infrastructure investments such as rail networks across borders could improve tracking and support formalisation. But for now, “people will continue to move goods across on foot, motorbikes, or in cars, bypassing formal checkpoints.”
