Beyond Oil: A Quantitative Analysis of Nigeria's Non-Oil Export Growth

Nigeria's economy has long been synonymous with oil, but recent data reveals a quiet revolution unfolding in its non-oil export sector. This transformation, driven by strategic policy shifts and market dynamics, is reshaping the country’s economic trajectory and reducing its reliance on hydrocarbon revenues.

According to the Nigerian Export Promotion Council (NEPC), non-oil exports surged by 19.6% year-on-year in the first half of 2025, reaching $3.225 billion, compared to $2.696 billion in H1 2024. Export volumes also increased, rising to 4.04 million metric tonnes from 3.83 million tonnes, indicating that this growth is not merely price-driven but reflects higher productivity and improved logistics. This performance builds on earlier momentum, with Q1 2025 non-oil exports hitting N3.17 trillion (approximately $3.4 billion), a staggering 78% year-on-year increase.

Cocoa and its derivatives emerged as the star performer, accounting for 35% of total non-oil export value in H1 2025. This growth is attributed to rising global demand, higher prices, and expanded local processing capacity. Similarly, cashew and sesame exports saw significant gains, with sesame maintaining its role as a steady revenue earner. Fertilizer exports, particularly urea, also contributed notably, reflecting output from Nigeria’s large industrial plants and demand from African and Asian markets.

While agricultural goods dominate, ICT service exports remain underrepresented in official data. Studies highlight that ICT exports could become a critical growth avenue, given their scalability and potential to generate high-value jobs. However, inadequate documentation and a lack of targeted policies have limited their impact. For instance, Iranian knowledge-based companies prioritized factors like competitive pricing, export-related costs, and exchange rates to boost ICT service exports, suggesting lessons for Nigeria.

Nigeria’s export destinations have expanded, with the Netherlands becoming the top importer (18.64% of non-oil export value), followed by the United States and India. This aligns with global commodity flows, cocoa to Europe, fertilizers to Asia and North America, and underscores exporters’ ability to tap into both traditional and emerging markets.

Policies Driving Growth

1. African Continental Free Trade Area (AfCFTA):

Market access and tariff relief under AfCFTA have been pivotal. The agreement has enabled Nigerian exporters to reach broader audiences, with intra-African trade poised for further growth.

2. NEPC Initiatives:

The NEPC has focused on capacity-building programs covering quality standards, packaging, certification, and documentation, the "unglamorous but essential plumbing of export competitiveness". These efforts have helped expand the product basket to 236 distinct products in H1 2025, up from 202 in H1 2024, indicating a shift from raw materials to semi-processed and value-added goods.

3. Government Support:

The federal government has created enabling environments for agriculture and manufacturing, including improvements in warehousing, packaging, and labeling. Initiatives to mainstream informal trade, such as MoUs between NEPC and the National Bureau of Statistics, aim to capture previously undocumented exports.

Challenges and the Path Forward

Despite progress, significant hurdles remain. Data gaps plague the sector, with informal cross-border trade estimated to account for 50% of non-oil exports. This informal trade, valued at over $31.8 million in 2024 according to NEPC estimates, highlights the need for simplified documentation processes and better border infrastructure. Additionally, logistics costs, unreliable power, and inconsistent trade facilitation erode competitiveness.

To sustain growth, Nigeria must:

1. Formalize Informal Trade: Reduce bureaucracy and deploy digital solutions to capture unrecorded transactions.

2. Boost Value Addition: Encourage local processing of cocoa, cashew, and sesame to retain more value domestically.

3. Invest in ICT Exports: Learn from global models to develop high-tech export strategies.

4. Improve Infrastructure: Address port inefficiencies and power shortages to reduce operational costs.

To surmise these, Nigeria’s non-oil export boom is a testament to the resilience and adaptability of its economy. While oil still dominates fiscal revenues, the non-oil sector is carving a path toward sustainable diversification. By addressing structural challenges and leveraging policies like AfCFTA, Nigeria can transform this growth into long-term economic stability. The numbers tell a promising story, one where oil is no longer the sole protagonist.