By Seun Ibiyemi
The Centre for the Promotion of Private Enterprise (CPPE) has raised concerns over the growing participation of foreign nationals, particularly Chinese traders, in Nigeria’s retail and distributive trade sector.
The organisation warned that the trend could intensify pressure on Nigerian-owned businesses and jobs if existing regulations governing foreign participation in the retail market are not effectively enforced.
In a statement issued by its Chief Executive Officer, Dr Muda Yusuf, the CPPE said Nigeria’s distributive trade sector remains a major source of employment and livelihoods, particularly for micro, small and medium enterprises.
According to the organisation, the sector accounts for an estimated 27.5 per cent of Nigeria’s workforce, with millions of Nigerians engaged in wholesale and retail businesses covering textiles, ICT products, automobile spare parts, electrical goods, plumbing materials, household products and other consumer goods.
The CPPE said the increasing presence of foreign traders in these segments therefore required urgent policy attention.
It stressed that its concerns were not directed at Chinese investment or Nigeria’s broader economic relationship with China, describing China as one of Nigeria’s most important trading partners and a major source of imports.
The organisation said Nigerian businesses had benefited from long-standing commercial relationships with Chinese manufacturers, exporters and distributors, particularly in the supply of machinery, industrial inputs, technology products and consumer goods.
However, it expressed concern about situations where foreign manufacturers or major suppliers move downstream into retail and compete directly with the Nigerian businesses that previously served as their distributors and customers.
The CPPE said such developments could alter the structure of the retail market and place additional pressure on domestic enterprises, particularly at a time when businesses are already facing high financing costs, weak consumer purchasing power and broader economic pressures.
It noted that reports from market operators had raised concerns about foreign participation in areas including textiles and fabrics, computers and telephone accessories, automobile spare parts, tyres and plumbing materials.
The organisation also pointed to protests and complaints by traders in some major commercial markets, saying such developments should receive the attention of policymakers.
The private-sector advocacy group called for a comprehensive review of the regulatory framework governing foreign participation in Nigeria’s retail economy.
It urged relevant government agencies to examine the issuance and enforcement of business permits, expatriate quotas, immigration approvals and other authorisations granted to foreign nationals operating in the country.
According to the CPPE, expatriate quotas should primarily facilitate the entry of skills and expertise that are scarce or unavailable locally, rather than enable foreign nationals to displace Nigerians in economic activities where domestic capacity already exists.
It argued that retail trading generally does not require specialised foreign expertise, raising questions about the effectiveness of existing immigration and investment regulations where non-Nigerians are involved in such activities.
The organisation, however, said it was not advocating arbitrary restrictions or hostility towards foreign investors.
Rather, it called for consistent enforcement of existing laws, transparent rules and a clearly defined investment policy.
The CPPE said Nigeria should remain open to foreign investment but ensure that its investment policy reflects the country’s employment and industrialisation priorities.
It advocated greater foreign investment in manufacturing, infrastructure, technology, agro-processing, mining, energy and other sectors where Nigeria requires capital, technical expertise and productive capacity.
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According to the organisation, the retail sector requires a different policy approach because of its importance to employment, entrepreneurship and SME development.
The CPPE said Nigeria should encourage foreign businesses to invest in manufacturing, processing, technology, logistics and export-oriented activities rather than increasingly competing with indigenous businesses at the retail end of the value chain.
It called on the government to investigate complaints from Nigerian traders, strengthen coordination among immigration, investment, trade and labour authorities, and establish clearer guidelines on permissible foreign participation across the distributive trade value chain.
The organisation also urged authorities to ensure that expatriate quotas are linked to demonstrable skills gaps and specialised competencies.
The CPPE maintained that Nigeria could deepen its economic relationship with China and other countries while simultaneously protecting the entrepreneurial space supporting millions of domestic businesses and livelihoods.
It said the objective should not be protectionism but fair competition, regulatory integrity, employment protection and strategic investment policy.
