The Centre for the Promotion of Private Enterprise has urged the federal government to reject a World Bank recommendation calling for increased importation of petroleum products and food, arguing the policy would undermine Nigeria's macroeconomic gains and cripple domestic production capacity.
CPPE Chief Executive Officer Dr. Muda Yusuf issued the warning on Sunday, describing the recommendation contained in the World Bank's Nigerian Development Update as deeply troubling and fundamentally misaligned with Nigeria's current economic realities and reform trajectory.
Structural Imbalances Persist for Local Producers
Yusuf highlighted that structural challenges continue to create an uneven playing field for domestic manufacturers and producers. High energy costs, inadequate infrastructure, and lending rates exceeding 25 per cent have compounded the operating environment for local industries, many of which remain uncompetitive against subsidised imported alternatives.
"What is being presented as market competition is, in reality, a structural asymmetry that places domestic producers at a significant disadvantage. This is not a level playing field," the CPPE chief said.
The surge in petroleum imports has been stark. Just IN figures released recently indicated that petrol imports jumped by 97 per cent in March despite increasing local supply capacity, underscoring the scale of import pressure already facing the domestic market.
Energy Security Requires Domestic Refining Expansion
Drawing on Nigeria's historical experience, Yusuf cautioned that reliance on imports had previously led to refinery shutdowns and enormous foreign exchange burdens. He argued the solution lies in expanding domestic refining capacity rather than issuing additional import licences for petroleum products.
"Encouraging importation at this stage would undermine investor confidence and reverse progress towards energy security," he said. "Nigeria needs expansion of domestic refining capacity, not more import licences for petroleum products."
The economist also cautioned against excessive food imports, warning that import surges depress farmgate prices, discourage investment in agriculture, erode rural incomes, and undermine food system resilience.
Call for Industrialisation-Focused Reforms
Yusuf warned that heavy import dependence could intensify pressure on the naira, deplete foreign reserves, and expose the Nigerian economy to global commodity shocks. He argued that import liberalisation is not a sustainable solution to supply-side constraints.
"It risks deepening structural vulnerabilities, accelerating de-industrialisation, and exposing the economy to greater external shocks," he said. "Sustainable economic transformation is anchored on production, value addition, and industrial capability, not import dependence."
The CPPE chief called on the World Bank to pivot its recommendations towards industrialisation-focused reforms, including policy support for domestic refining, measures to reduce production costs, and investments in strengthening manufacturing and agricultural value chains.
"Nigeria's development trajectory must be anchored on a production-driven growth model characterised by strong domestic refining capacity, a competitive manufacturing sector, robust agricultural systems, and energy and food security," Yusuf concluded.