Xenophobic attacks: CPPE cautions FG on sanctions against

Renewed xenophobic violence targeting Nigerian and other African migrants in South Africa has reignited calls for government intervention, but Nigeria's business community is sounding an alarm. The Centre for the Promotion of Private Enterprise (CPPE), a leading private-sector advocacy group, has publicly cautioned the Federal Government against imposing retaliatory sanctions on South African firms operating in Nigeria—a position that reflects deeper anxieties about economic blowback in an already fragile market.

## What triggered the latest xenophobic escalation?

Recent attacks on foreign nationals in South Africa, particularly targeting Nigerians engaged in informal trade and services, have sparked outrage across Nigeria's political and civil society landscape. Videos and reports of mob violence, property destruction, and intimidation circulated widely on social media, prompting calls from Nigerian lawmakers and activists for swift government response. The incidents echo the 2008 and 2015 xenophobic crises that left dozens dead and caused billions in economic damage. This time, however, the timing is more sensitive: Nigeria and South Africa are grappling with currency instability, energy crises, and investor flight—conditions that make trade wars economically catastrophic.

The CPPE's warning arrives amid mounting pressure on President Tinubu's administration to demonstrate strength. Some legislators have already proposed visa restrictions and asset freezes targeting South African companies. On the surface, such measures appear justified as a deterrent. But the business group's intervention reveals a critical tension: political symbolism versus economic reality.

## Why are sanctions economically risky for Nigeria?

South Africa is Nigeria's largest trading partner on the continent. Bilateral trade reached approximately $2.3 billion in 2023, with South African firms dominating retail, mining services, financial technology, and manufacturing sectors. Major players like Shoprite Checkers, Vodacom, and MTN have substantial investments and employment footprints in Nigeria. A tit-for-tat sanctions regime would likely trigger immediate capital outflows, currency pressure on the naira, and job losses in logistics and services—precisely the sectors Nigeria's economy cannot afford to weaken.

The CPPE's caution also reflects broader investor sentiment: unilateral retaliatory measures signal policy unpredictability to foreign investors already spooked by Nigeria's regulatory volatility and forex constraints. In 2024, foreign direct investment into Nigeria remained depressed, and manufacturing capacity utilization stayed below 50%. Adding a trade dispute with South Africa could accelerate a deeper withdrawal.

## What are the geopolitical alternatives?

The CPPE's implicit argument is that Nigeria should pursue diplomatic channels and multilateral pressure within the African Union and ECOWAS rather than unilateral economic punishment. Such approaches preserve trade relationships while holding South Africa accountable for governance failures. They also avoid the collateral damage that sanctions inflict on ordinary workers and small businesses in both nations.

This stance does not minimize the severity of xenophobic violence—a persistent indictment of South African institutional failure and social breakdown. Rather, it prioritizes Nigeria's economic resilience during a period of structural fragility.

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