NAVIGATING TRADE PROTECTIONISM: ITS IMPLICATIONS ON GLOBAL PROCUREMENT ACTIVITIES AND THE NIGERIA AND U.S. ECONOMY

Abstract

This paper examines the implications of trade protectionism on Nigeria’s economy, with a particular focus on the sectors that heavily rely on exporting oil and gas products to the United States (U.S). Conversely, the U.S. occasionally resorts to restrictive measures to defend domestic industries against competitive Nigerian imports, primarily to conserve domestic employment and promote indigenous innovation The reliance on oil exports also poses challenges for Nigeria’s diversification efforts and its ability to develop other sectors of the economy. In recent years, there has been a growing trend of protectionist measures implemented by countries around the world, which has the potential to disrupt global supply chains and affect international trade. As a major oil exporter, Nigeria is vulnerable to global oil price changes, and any increase in trade barriers, such as tariffs or quotas, could have significant implications for the country’s overall economic growth. Historically, nations have adopted protectionist strategies to shield domestic industries, ensure economic stability, and protect employment. However, the rise in such measures in recent years has disrupted global supply chains, inflating procurement costs and imposing challenges to businesses that rely heavily on international sourcing. In navigating this convoluted trade milieu, the paper proposes a set of adaptive strategies. Emphasis is placed on the endorsement of regional trading blocs, advocating the benefits of memberships like ECOWAS for Nigeria and NAFTA/USMCA for the U.S. Such affiliations can serve as buffers against global protectionist winds. Furthermore, harnessing technology in procurement operations is underscored as a critical tool for businesses, aiding in the mitigation of potential disruptions and costs instigated by protectionism. In conclusion, while trade protectionism addresses certain immediate national concerns, its cascading effects on global procurement and specific bilateral relations mandate an informed, strategic response to ensure sustained economic growth and stability.