Nigeria risks 27.5% US tariff over forced labour concerns

Nigeria could be hit with tariffs of up to 27.5 per cent on exports to the United States under a proposed trade policy targeting countries deemed to have inadequate measures against the importation of goods linked to forced labour.

The proposal was unveiled by the Office of the United States Trade Representative (USTR) following a Section 301 investigation into the enforcement of forced labour regulations across global supply chains.

Nigeria is among 54 economies identified in the investigation and one of seven African countries listed for allegedly failing to sufficiently prohibit or enforce restrictions on goods associated with forced labour. Other African countries named include Algeria, Angola, Egypt, Libya, Morocco and South Africa.

If implemented, the tariffs could make Nigerian exports less competitive in the US market by increasing costs for importers and reducing demand for affected products.

According to the USTR, the investigation found that several trading partners lacked effective policies and enforcement mechanisms to prevent products made with forced labour from entering international markets.

The agency argued that weak enforcement creates unfair advantages for producers by lowering production costs and undermining fair competition.

Under the proposed framework, affected countries could face additional tariffs ranging from 10 to 12.5 per cent. Combined with an existing baseline tariff of 10 per cent, total duties on some exports could rise to as much as 27.5 per cent.

US Trade Representative Jamieson Greer said the proposal reflects Washington’s commitment to addressing what it considers disparities in global trade enforcement.

“The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable. We will no longer tolerate this disparity,” Greer said.

The proposed measures extend beyond Africa and could affect several major US trading partners, including China, India, Vietnam, Brazil and the United Kingdom.

For Nigeria, the development comes as the government intensifies efforts to diversify exports beyond crude oil and expand access to international markets. Trade analysts warn that higher tariffs could pose challenges for exporters, particularly those relying on competitive pricing to gain market share in the United States.

Experts, however, note that the proposal is not yet a final trade sanction but serves as a signal that countries may face increased scrutiny over labour practices and supply chain transparency.

They argue that affected countries may need to strengthen compliance systems and demonstrate adherence to international labour standards to avoid potential penalties.

The USTR has opened a public consultation process, allowing governments, businesses and stakeholders to submit comments and evidence before a final decision is reached.

The consultation period provides Nigeria and other affected countries an opportunity to engage US authorities, present proof of existing enforcement measures and seek exemption from the proposed tariffs.

The outcome of the review is expected to be closely watched by exporters, investors and policymakers due to its potential impact on trade flows, export earnings and access to the US market.