AfCFTA usage remains low despite Nigeria’s N12.36trn non-

Nigeria's non-oil export sector achieved a landmark N12.36 trillion ($8.2 billion USD equivalent) in 2025, a testament to the continent's manufacturing and agricultural potential. Yet beneath this headline figure lies a paradox that should concern European investors banking on African regional integration: the African Continental Free Trade Area (AfCFTA)—the world's largest free trade agreement by member count—remains dramatically underutilized by the very exporters generating these revenues.

The Network of Practicing Non-Oil Exporters of Nigeria (NPNEN) survey released in March 2025 exposes a critical infrastructure and knowledge gap. Despite AfCFTA's tariff elimination framework and preferential access to 1.3 billion consumers across 54 member states, Nigerian exporters are conducting intra-African trade through conventional channels rather than optimizing this agreement. This inefficiency directly impacts European investors who have positioned themselves as intermediaries or supply-chain partners in Nigerian agricultural exports, textiles, and light manufacturing.

**The Structural Problem**

AfCFTA entered force in January 2021, yet adoption rates remain stubbornly low across member states. For Nigeria specifically—Africa's largest economy and a gateway to West African markets—the disconnect stems from three root causes: inadequate customs infrastructure digitalization, inconsistent tariff implementation across partner states, and limited exporter awareness of compliance requirements. European firms exporting to Nigeria or importing Nigerian goods often navigate AfCFTA rules through third-party intermediaries, adding 8-15% to transaction costs. This negates the agreement's core benefit: cost reduction through duty elimination.

The N12.36 trillion export figure reflects traditional channels: bilateral trade agreements, Commonwealth preferences, and EU-ACP arrangements. AfCFTA should be amplifying this, not supplementing it. The fact that it isn't reveals market inefficiency—and opportunity.

**Implications for European Investors**

This underutilization presents both a risk and an opportunity for European entrepreneurs. On the risk side: if AfCFTA adoption accelerates (which it will), competitive advantages enjoyed through bilateral relationships may erode. A German textile importer currently leveraging preferential rates via EU-Nigeria trade agreements cannot assume those advantages persist as intra-African supply chains consolidate.

Conversely, European investors willing to invest in AfCFTA compliance infrastructure—customs brokerages, digital documentation systems, tariff advisory services—can capture significant margin. The gap between current usage and potential usage represents a services arbitrage opportunity. Belgian or Dutch logistics firms, for instance, could partner with Nigerian export associations to simplify AfCFTA documentation, capturing fees as utilization climbs.

**The Market Window**

Nigeria's exporters aren't avoiding AfCFTA from disinterest; they lack tools and clarity. This is solvable. As the African Union and national governments strengthen implementation (Kenya and Egypt are ahead of Nigeria here), first-movers in support services will capture disproportionate value. The 2025 export surge shows demand exists; AfCFTA will soon be the path through which it flows.

European investors should interpret this survey as confirmation that African regional integration remains in its early innings. The next five years will see dramatic acceleration. Position accordingly.

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