Consequences of Boarder Closure and Banned Importation on the Bilateral

Relationship between Nigeria and her Neighboring Countries

Introduction

The term “bilateral relationship” is coined from the dictum “bilateralism” which talks about how

two sovereign states agree to conduct political, economic, or cultural affairs between themselves.

States having bilateral knots often exchange diplomatic representatives, which helps foster

healthy relationships between members in such relationships.

However, the genesis of bilateral relationships between nations is traceable to the point at which

barriers to trade were eliminated and there was an increase in the degree of interdependence of

countries across nations, this point is regarded as globalization. According to Wade (1996),

globalization is the growth in the internationalization of trade, technology, business, and finance.

Similarly, the emergence of globalization piques a higher level of cross borders relations which

was aided by liberalization and enhanced information technology, especially in the area of

foreign direct investment and trade. It is on this note that nations of the world entered into

various forms of trade relationship (bilateral and multilateral). It is often believed that the best

way to stop poverty is to embrace globalization which paved way for a free market and free trade

in most developing countries. In view of this fact, globalization provides huge opportunities in

terms of making jobs and businesses available to emerging countries that could have suffered or

struggled economically (Canagarajah and Thomas, 2001).

As earlier pinpointed, a bilateral relationship could assume a form of political relations; an

example of such bilateral political relations is the case of Nigeria and South Africa political

initiative which gave rise to NEPAD (New Partnership for Africa’s Development). This initiative

was a collaboration between Nigeria and South Africa which was purported for developing the
African economy and also banish poverty in the continent (Egbeglum, 2013). Similarly,

economic bilateral relations could be in form of free trade agreements and investments.

Initiatives such as: ECOWAS (Economic Community of West African States) created in 1975

and the African Continental Free Trade Area (AfCFTA) formed in 2019, are forms of

multilateral economic agreement for promoting healthy relationships among African nations,

improve cross- border movement and free trade (Babatola, 2015; Landry and Colette, 2019).

In the case of Nigeria, the country has sustained a good relationship with most of its neighboring

countries such as: Benin, Chad, Cameroon, Ghana, Niger, Togo, and Equatorial Guinea

(Babatola, 2015). However, this long-time relationship that has benefited the country is under

threat as a result of the recent closure of the Nigerian borders to her neighboring countries and

the ban on importation of goods in August 2019 (Landry and Colette, 2019). The closure of these

borders was as a result of the fact the country want to reduce smuggling of goods, promote the

local agricultural sector, stop the outflow of subsidized fuel and inflow of Asian rice and

generally enhance economic growth (Liedong, 2019).

Based on the foregoing discussion, a very important question to be asked at this juncture is, does

unilateralism pay off more than bilateral ties? i.e. is it better for a country to exist in isolation

rather than connecting with others? To this end, this paper tends to examine the consequences of

boarder closure and banned importation on the bilateral relationship between Nigeria and her

neighboring countries by focusing on the economic impact of the boarder closure and banned

importation on the country.

Based on this premise the study will try to achieve these objectives;

1. To determine the relationship between rice importation and GDP values

 2. To determine the relationship between poultry products importation and GDP values

Research Hypotheses

H01: there is no significant relationship between poultry products importation and GDP values

H02: there is no significant relationship between rice importation and GDP values

Theoretical perspective

A theory is a logical explanation of the relationship among variables. It provides a

comprehensive explanation of events. Therefore, it is essential that a researcher become familiar

with those theories that can underpin his/her study (Kombo and Tromp, 2009). Based on this

backdrop, this study identified two major theories that show the need for relationships to exist

among nations of the world and these include: the theory of comparative advantage, and the

national competitive advantage theory.

The theory of comparative advantage was postulated by David Ricardo 1817. The focus of the

theory is that a country should specialize only in the production of goods that it has a

comparative advantage rather than producing those ones in which it has absolute advantage. This

implies that country might be good at producing two commodities; however, it is better for such

country to buy / import one of the goods from other countries if production of such goods will

cost more when producing it in his country.

For instance, if Nigeria is producing crude oil and cotton and Benin Republic is also producing

these commodities too. However, because of specialization and low cost of production, Nigeria

incur less cost in production of crude oil while Benin republic which lack this capacity incur high
production cost in crude oil but low cost in producing cotton. Ricardo opined that it is advisable

for Nigeria to produce crude oil and import cotton from Benin republic.

The implication of this theory to this study is that, this scenario will unequivocally bring these

countries together for trading purposes and this would mark the commencement of international

trade which often involve cross border exchange since the two countries share borders. In view

of the foregoing discussion, it is better for a country to buy (import) instead of producing a

commodity that it will cost more being home made. This further suggests that, when borders are

closed, countries will not enjoy the benefits of comparative advantage of saving more via

avoiding the production of commodities that will cost more when they are produced locally.

On the other hand, the national competitive advantage theory was postulated by Michael Porter

in 1990. The centrality of the theory is that the ability of a nation to thrive well and remain

competitive in a particular industry is dependent on the capacity of industry to frequently

innovate and improve itself. However, nation’s competitiveness is contingent on four major

factors and this includes: 1. Resources and capabilities of the local market 2. Demand conditions

in the local market 3. Availability of local suppliers 4. Features of the local firms (Porters,

1990).

Explaining these factors, Porter opined that the level of sustainable competitive advantage of a

country depends on the available resources (tangible and intangible) at the disposal of the nation

that can be imported or exported. Furthermore, it is quite imperative for the local market of a

country to generate a substantial level of demand so as to keep the local industry innovating and

this would fetch such a country competitive edge above its competitors. Similarly, it is also

essential that large corporations within a nation that are meeting international need must have
steady supply of inputs required by the industry as this enhances efficiency in production. In

conclusion, the features of a firm such as: firm’s strategy, industry structure and rivalry are vital

ingredients that will spur innovation and competitiveness within an industry and hereby lead to

sustainable competitive edge (Porters, 1990).

The implication of this theory is that no country exists in isolation. Every country has resources

that give it a competitive edge above other competing countries in a particular industry.

However, these resources needs to be imported or exported before a sustainable competitive edge

can be achieved. This suggests that there should not be a blanket barrier to import or export in a

nation. The theory further supported the fact that the local market must also be protected. This

implies that though the local market is being protected, it does not stop the inflow and outflow of

resources from one country to another. Finally, the case of Nigeria’s industries which do not

have a particular strategy, lack structure, and inconsistent rivalry among competing firms would

deter innovation and improvement in its industries. This will lead to a competitive disadvantage

History of border closure and banned importation in Nigeria

According to Babatola (2015), the greatest challenge confronting Nigeria today is international

terrorism which is often caused by cross-border security challenges, porous borders, religious

extremism, just to mention a few. The mentioned challenges often lead to boarder closure. In

this regard, border closure is not a new thing to Nigerians and as a matter of fact there is a long-

time history of Nigerian boarder to its neighboring countries. Reasons for boarder closure also

include: breach of bilateral agreement (smuggling), land dispute, protection of local industry,

political tension, etc (Bouillon, 2019).

For instance, between 1984 & 1986 the Nigerian boarder was shut down against Benin in order

to curtail smuggling of petroleum products. This action did not produce any meaningful result.

Again, Nigerian border was closed in 1996 during the military dictatorship era (President

Abacha) which was as a result of political dispute between Nigeria and Benin. The then Benin

president formed an alliance with the United States of America which president Sani Abacha

considered as a threat to his government. However, this action led to shortage of gasoline at

Benin republic (Benjamin, et al., 2015)

The Nigerian-Benin border was further closed in year 2003 because Benin granted a Nigerian

criminal asylum in Cotonou. The border was however reopened when the criminal was handed

over back to Nigeria. Similarly, in year 2008, the border was also closed to prevent the

proliferation of used car in Nigeria, which are usually smuggled through these borders (Golub, et

al., 2019). Not only that, President Buhari made several attempts to reduce smuggling in the

Nigerian border with her Neighboring countries. The latest of them is that of August 2019 when

the president order the closure of border and also banned the importation of goods (rice,

tomatoes, poultry products) from neighboring countries (Niger, Benin and Cameroon) with the

aim of reducing smuggling and promoting the Nigerian Agricultural sector.

However, it is alarming that this closure happened three month after the country just signed the

AfCFTA agreement (Landry and Colette, 2019). Meanwhile, the impact of the border closure is

mostly felt by informal traders (SMEs) whose businesses are located along the borders who

experience a downward trend in patronage and many of these businesses usually go into

extinction.
Table 1 shows the history of banned importation in Nigeria between 1995 – 2018.

Table 1 History of banned importation in Nigeria (1995 - 2018)

1995 2001 2007 2013 2018
Bear banned 100 Banned banned banned
Cloth banned 55 Banned banned Forex ban
Poultry meat banned 75 Banned banned banned
Rice 100 75 50 100 70
Sugar 10 40 50 60 70
Cigarette 90 80 50 50 95
Used cars banned Banned Banned banned Banned
Vegetable oil banned 70 Banned banned Banned
Source: Adapted from
https://www.researchgate.net/publication/255979414_Import_Bans_in_Nigeria_Increase_Povert
y

Consequences of border closure and banned importation

Positive impact on Nigerian Economy

One of the remarkable positive impacts of border closure was that the Federal Government of

Nigeria was able to save a huge amount of money usually spent on fuel subsidies as sizable

quantities of fuel were usually smuggled across the borders (Ghins and Heinrigs, 2019).

Furthermore, there is a 20% decline in fuel imports which purposely reduced the amount of

Naira spent on subsidizing fuel. In addition to this, after the border closure, the sales of petrol fell

by 12.7% in Nigeria (Bouillon, 2019). Therefore, it can be inferred from the aforementioned

statistics that, a large amount of subsidized fuel was invariably smuggled out of the country to

neighboring countries of Nigeria for resale. However, Bouillon maintained that, if the border

remains closed and the reduction in fuel consumption is sustained, Nigeria would be saving a

sum of N162.1 billion naira annually ($444 million) from fuel subsidy.

Similarly, firms like; Olam, Onyx Rice, and QuarraRice in the Nigerian agricultural staple food

industry especially rice, are enjoying a boom period profit. This is because the country banned
rice importation and closed its border which eventually deterred smuggling (Bashir, 2020). It

also means that the Federal government would also be saving million of Naira by preventing

smuggling and ensuring imported goods goes through the appropriate channels. In addition to

this, the Nigerian local rice industry will grow well.

Negative impact on Nigerian Economy

Border closure has a negative effect on the economical, political and socio-cultural lives of the

people where ever it occurs. This was in no way different for Nigeria and its neighboring

countries. One major negative implication of border closure and banned importation is that,

economic activities along the border course are crippled. For instance, communities obtaining

their livelihood from the “Seme” border of Benin which usually leans on the Nigerian market for

sustenance is deprived of support. The closure has made SMEs farmers to lose their products as

well as their source of income. The itch of the border closure is also greatly felt by crop of

Nigerians especially those selling consumables staple foods like rice. The closure has brought

about an increase in the prices of various brands of rice in the country. A bag of rice (50kg)

which was initially sold for N10,000 before the border closure has skyrocketed to a sum of

N22,000 within a month after the border closed. Similarly, other complementary items such as:

fish, groundnut oil, palm oil, meat, etc also increased leading to a rapid inflation. Based on this

development, most household in the country spend larger percentage of their income on food

items (Bashir, 2020).

Buttressing this view, National bureau of statistics (NBS), as at November 2019 reported that

year-on-year food inflation rate increased from 13.2% in August 2019 to 14.09% in October

2019. This is the highest rate of increase of about 1.5% increase on month-on month basis in the
cost prices of food like poultry products, cooking oil, cereals, rice, etc. However, this statistics

shows that, instead of the country to experience the usual decelerating food inflation rate which

is peculiar to the harvest season in Nigeria, the reverse is the case. This scenario is responsible

for the rise in the consumer price index (CPI) from 11.24% in September 2019 to 11.61% in

October 2019 (NBS, 2019).

Not only that, the border closure policy gave rise to other problems like; congested seaport

especially that of Lagos State and it also increase the level of bribery and corruption at these

seaports owing to the fact that individuals who wish to clear their goods would have to bribe

Wharf officials before they can get their goods cleared and this negates the main idea of the

Nigerian president which is the fight against corruption (Bashir, 2020). The borderland closure

policy is a threat to investors, especially those that require transactions across the border. This

disruptive policy will no doubt prevent foreign investors from coming into the country and those

within the country cannot recoup whatever they have invested. In addition, the disruptive impact

of the borderland closure and banned importation did not leave the manufacturers and the

industrialist untouched. Certain goods manufactured in Nigeria such as cosmetics, pasta, plastics,

soaps, etc are usually exported through these land borders to Nigerian neighboring countries and

since the borders are closed these categories of people are left to suffer loss (Bouillon, 2019).

In summary, one can infer that Nigeria closing its land border destabilizes the principle of

interconnectivity existing among the nations of the world and it also negates the theory of

comparative advantage which posits that nations of the world can import whatever resources

they do not have the capacity to produce from other countries. Based on this development, the

growth of the Nigerian economy is being threatened and this is invariably affecting her

neighboring countries.
Bilateral Relationship

It seems that the bilateral relationships between Nigeria and her neighboring countries have been

severed by the disruptive nature of the border closure and banned importation policy. This

follows by extension that for several decades, some Nigerians have forgotten their homeland and

now fully reside in these neighbouring countries (Benin, Chad, Niger and Cameroon).

Buttressing this view, statistic shows that 30% of the population of the Benin Republic and the

Niger Republic are basically Nigerians. Similarly, about three million Nigerians reside in

Cameroon and more than two million reside in Coted’iviore. This was made possible based on

ECOWAS agreement which gave room for the free movement of goods and people across

various West African Countries (Bouillon, 2019). This implies that the long-time symbiotic

relationship existing between Nigeria and her neighboring countries is gradually meeting its

waterloo. As a form of retaliation, there are bound to be more xenophobic attacks and expulsion

of Nigerians in some other path of the African Continent since Nigeria will not allow other

country indigenes to cross her border nor transact businesses within her territory. This implies

that political tension might be raised from this kind of disruptive policy. In addition to this,

Nigeria is setting precedence for other African countries to follow. Further or prolonged border

closure can be misinterpreted as a form of economic blockage that other Africans might want to

emulate.
In addition, the border closure is a threat to uniform cooperation among African countries for the

preservation and exploitation of certain natural resources that are shared among African

countries. For instance, the river Niger took its source from Guinea and cut across other African

countries like Mali and Niger Republic. If the river is diverted, the source of water to Kanji dam

will be cut off (Landry and Colette, 2019). This suggests that no country should exist in isolation

or debar cross border relationship because the adverse effect is always devastating.

It, therefore, calls for concern that Nigeria closed her border 3months after signing the AfCFTA

agreement (non-tariff barriers, quick trade facilitation, absence of quantity restriction, border

cooperation etc). This is inconsistent with the content of the agreement signed in the African

Continental Free Trade Area which is meant to: improve intra-African trade and produce a

continental market with allows free movement of goods and services coupled with persons.

Similarly, Nigeria being a strong member of WTO for over two decades is contractually bound

to be committed to a multilateral relationship (Landry and Colette, 2019).

Based on the foregoing, it is safe to state that other countries in this formal relationship have the

right to retaliate. In addition to this, it further implies that if there is any futuristic trade

agreement that could be beneficial to Nigeria, especially in West Africa, Nigeria might be

excluded. Furthermore, this breach of agreement in multilateral relationships speaks volumes of

the caliber of African leaders in the leadership seats of African countries (Bashir, 2020).

Conclusively, the negative consequences of border closure and banned importation on the

bilateral relationship between Nigeria and her neighboring countries far outweigh the positive

consequences. To this effect, this is a great lesson for other African countries that are aspiring to
close their borders in the future. It is very important that such countries need to be reminded of

the negative impact of border closure such as unemployment, inflation, poverty, retaliations, and

scarcity, just to mention a few.

Method

This study adopted a quantitative approach for its data analysis. Meanwhile, secondary data on

rice and poultry products importation and GDP values for 30 years (1990-2021) was used as the

basis of the analysis. However, graph and multiple regressions were used as statistical tools to

better understand the subject matter. All analyses were carried out with IBM SPSS 22.

Analysis

Fig 1. GDPValues, Rice and Poultry Importation in Nigeria from 1990-2021

Source: Macrotrends Analysis, (2022).

Fig. 1 reveals the GDP values in Million US dollars as well as the value of rice and poultry

products imported into Nigeria from 1990 to 2021. The graph shows that there is a constant

importation of rice across Nigerian borders from 1990 till the year 2003 and 2019 (when there

was a ban on the importation of rice). Similarly, poultry products importation also increased but

not at a rate compared to rice importation. However, the importation of these two categories of

food items might have contributed to improving the country’s GDP as the value improved year

after year.

Multiple Regression model

Yi= bo + biXi+b2X2+ Ui

Where Yi = GDP, Xi and X2 = Rice and Poultry importation,

Yi = -16.16 + 0.068Xi + 4.021 X2

Table 1 Model Summaryb

Adjusted R Std. Error of Durbin-
Model R R Square Square the Estimate Watson
1 .937a .877 .869 65.443 1.003
a. Predictors: (Constant), Imported poultry products, Imported Rice
b. Dependent Variable: GDP values from 1990-2021

Table 1(Model Summary) which is a measure of the test of good fit revealed an R Square value
of 0.877 which implies that 87.7% of the changes in GDP can be explained by the predictors
(Rice and Poultry products importation). This outcome shows that the model is adequate to
explain the notable variation in GDP value
Table 2 Coefficients
Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) -16.160 24.489 -.660 .515
Imported poultry products .068 .023 .319 2.998 .006
Imported rice 4.021 .645 .664 6.238 .000
a. Dependent Variable: GDP values from 1990-2021

Meanwhile, the regression model Yi = -16.16 + 0.068Xi + 4.021 X2 was derived from table 2

(coefficients). This outcome reveals that there is a constant reduction in GDP values by a factor

of 16.16 even when there is no importation of rice and other poultry products by the country.

Conversely, a one-unit increase in the importation of poultry products will result in a 0.068 unit

increase in GDP value. Similarly, a one percent increase in rice importation will result in a 4.02

unit in GDP value. However, both imported poultry products (P =0.006 < 0.05) and imported

rice (P =0.00 < 0.05) is significantly related to GDP value. Thus, we reject null hypotheses (1

and 2) that there is a significant relationship between the importation of rice, poultry products,

and GDP. Conclusively, this result shows that rice and poultry products importation still plays a

significant part in improving the nation’s GDP.

Policy recommendations

The menace posed by the disruptive policy of border closure and banned importation emanated

from the conception of the policy itself. The negative effects earlier mentioned are as a result of

the defects in the policy. To this effect, it is imperative that the Federal Government of Nigeria

engage the services of policy formulation experts so that the various facets of policy formation

(formulation, implementation and evaluation) can be aptly monitored. This step will prevent
further formulation of policies without evaluating the devastating knock-on effect of such

policies.

Similarly, it was high time the Federal Government of Nigeria holistically address issues that are

entrenched within its own institutions. The notable weak industries and the defunct agricultural

sector are seen to have been dominated by the oil sector with its frightful corruption status. This

is an indication that if care is not taken, the nation’s economy might end up comatose very soon.

In view of this, there is a need for the Federal Government of Nigeria to establish more market–

friendly measures while diversifying the economy away from natural resources especially crude

oil.

Furthermore, since this study identified smuggling as a major challenge that may warrant border

closure and banned importation, there is a need to find a lasting solution to the quandary. This

can be achieved by empowering the Nigerian Customs Service (NCS) by offering its officers

standard training/seminars on how to handle state–of–the–art equipment/gadget in solving

smuggling and border-related problems. Similarly, there must be a collaborative effort between

Nigeria and her neighboring countries to formulate and execute unified trade regulations which

might include the introduction of joint border patrol and other cross-country collaborations.

Not only that, this study identified the lacuna between protecting domestic producers/ local

markets from the molestation of importation and the policy of border closure and banned

importation. The study opined that border closure alone cannot pique continuous production

growth. To this effect, it is recommended that government should provide an enabling business

environment (which offers quick access to credit, enhanced business network, steady supply of

power, etc) and reduce the operational cost of the local producers to the barest minimum.
In addition, Benin Republic’s strategy of entrepot is contributing to part of the distortion in the

Nigerian economy because most of the goods imported into Nigeria via this border are done

illegally. To this effect, it is pertinent that the Nigerian government meets and encourages the

government of Benin Republic to embark on policies that would aid the business environment to

carry out legal businesses and at the same time upgrade its institutions to advance investment in

productive activities. In conclusion, if perhaps there is any reason for the Nigerian Government

to close the border in the future, there is a need for the government to give consideration to the

people (the poor, women, intra-regional traders, etc ) the closure may affect before implementing

such policy.