INTERNATIONAL TRADE POLICIES AND ITS EFFECT ON TRADE FINANCING IN NIGERIA

Abstract

For decades, the supremacy of trade policies on the investment climate is growing as trade policies remain crucial in both local and international transactions. Using dependency theory as the analytical framework, the study employed secondary sources and applied qualitative content analysis to examine international trade policies and its effect on trade financing in Nigeria. Findings indicate that Nigeria’s economic interactions with the global community have not aligned with its stated foreign trade policy. Nevertheless, foreign investment in Nigeria has continued to grow. For example, Chinese investment expanded significantly from about $2 billion in 2015 to roughly $13 billion in 2018 and maintained rapid growth into 2019. Moreover, China has surpassed the United States as Nigeria’s leading foreign investor in the electronic gadgets sector. Moreover, the paper found that, international trade policies significantly impact trade financing in Nigeria by influencing foreign exchange availability, market transparency, and the overall cost of doing business, as highlighted by recent efforts to automate forex markets and attract foreign investment. Policies such as reducing non-tariff barriers, ensuring political stability, and providing robust infrastructure are crucial for a stable financial environment, while challenges like corruption and insecurity can deter investors and increase transaction costs From the findings, it is recommended amongst others that the government maintain consistency in implementing its foreign trade policy; there is need for the Nigerian state to develop its technological base and boost its negotiation capacity so as to maximize the benefits in the country’s economic relations with the rest of the world.