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By Newspot Nigeria Editorial Desk
In 1776, Adam Smith’s The Wealth of Nations laid the intellectual foundation for modern economics. Centuries later, his warnings about protectionist policies still ring true—especially for Nigeria, where misguided attempts to shield local industries from foreign competition have too often backfired.
From rice to cars, Nigeria has pursued a protectionist playbook with the hope of sparking domestic production. Instead, it has sparked price surges, stifled innovation, and exposed the poor to deeper hardship.
The Border Closure Mistake
Take Nigeria’s 2019 land border closure, for instance. The policy was meant to boost local rice production and curtail smuggling. Instead, the cost of a 50kg bag of rice soared beyond the reach of most families. Markets in Kano and Lagos alike were flooded with smuggled rice from new, riskier routes through Niger and Cameroon. The goal of self-sufficiency turned into a self-inflicted wound on consumers.
The Automotive Policy That Stalled
Nigeria’s auto policy aimed to nurture a domestic car manufacturing industry by slapping tariffs of up to 70% on imported vehicles. Yet today, the average Nigerian still cannot afford a made-in-Nigeria car—because local assembly plants rely heavily on imported components and offer no real cost advantage. What we’ve ended up with are more expensive used cars and a few struggling local plants kept alive by state patronage rather than market competitiveness.
The Chicken-and-Egg Problem
Even poultry, where Nigeria has comparative potential, has suffered from uneven policies. Banning frozen chicken imports did little to support small poultry farmers who still contend with erratic feed prices, poor cold storage infrastructure, and high energy costs. Instead of growing a resilient sector, we merely shrunk consumer choice.
Adam Smith would not have been surprised by these outcomes.
“It is the maxim of every prudent master of a family never to attempt to make at home what it will cost him more to make than to buy,” Smith cautioned.
Protectionism, he argued, enriches the few while impoverishing the many. It props up inefficient producers and forces consumers to overpay for goods that could be imported more cheaply and reliably.
Two Exceptions—and We’ve Misused Them
Smith did concede two exceptions to his rule: national defense and retaliatory tariffs. If a product is critical to national security—like steel for wartime—or if another country unfairly blocks your exports, a temporary restriction might be justified. But Nigeria has abused this logic, treating every sector as “strategic” and making temporary bans permanent without delivering results.
Barriers Cannot Replace Reforms
Our problem isn’t foreign competition—it’s domestic dysfunction. Protectionism is no substitute for real reforms. The energy sector is still unreliable. Transport infrastructure remains outdated. Access to affordable credit is limited. Regulatory agencies are more likely to extort than to empower.
These are the real barriers Nigerian producers face—not foreign imports.
If Nigeria truly wants to grow its economy, it must embrace the lessons of global trade. Countries like Vietnam and Bangladesh didn’t prosper by blocking imports; they built efficient, export-driven economies through competitive policies, education, and infrastructure.
The Path Forward
Let’s be clear: free trade doesn’t mean Nigeria should become a dumping ground. It means we should create competitive value chains, not dependency. Imagine if we focused on becoming West Africa’s tech hardware hub instead of protecting overpriced local phone assemblers. Or if we turned the textile sector in Kaduna and Aba into export engines by investing in power and logistics instead of shielding them from imported clothing.
Smith’s wisdom wasn’t anti-Nigerian. It was pro-people, pro-efficiency, and pro-choice.
Today, when we reflect on why we are unable to pay a living wage or provide affordable essentials, we must confront the policies that have entrenched inefficiency and empowered cartels. Nigeria’s young population is creative, adaptive, and hungry for opportunity. But they can’t thrive in an economy fenced off by outdated trade ideologies.
Let’s trade in our fear of competition for a real investment in productivity. Protectionism may buy time, but only reform buys prosperity.
“Defense, however, is of much more importance than opulence,” Smith noted. That is true—but in Nigeria’s case, what we need is neither defense of inefficiency nor illusions of opulence. We need bold economic openness anchored on reform.
This editorial was prepared by the Editorial Board of Newspot Nigeria, committed to grounding national policy conversations in economic logic, practical experience, and the wisdom of history.
