January 20, 2025/CSL Research
On Friday, 17 January, Brazil announced Nigeria’s acceptance as a partner country in BRICS, the multinational bloc comprising Brazil, Russia, India, China, and South Africa. Under Brazil’s 2025 presidency of BRICS (succeeding Russia’s leadership in 2024), the bloc has prioritized strengthening cooperation within the Global South and advocating for reforms in global governance. Nigeria’s inclusion reflects its growing strategic importance and positions the country to play an active role in advancing these objectives.
This development marks a significant milestone for Nigeria, Africa’s fourth-largest economy, as it gains access to a coalition of emerging economies that collectively shape global trade, finance, and political dynamics.
Nigeria’s acceptance as a partner country in BRICS is a positive development expected to deepen its engagement with the bloc and boost trade activities. Currently, Nigeria’s exports to BRICS nations account for less than 15% of its total trade, with the bulk directed to India and China. Full membership, once achieved, could reduce trade barriers, streamline cross-border interactions, and strengthen economic ties across key sectors such as medicine and agriculture. Increased interaction within BRICS also holds potential for improved foreign inflows. For context, Nigeria attracted only US$1.07 billion in capital inflows from the BRICS countries during the first nine months of 2024, representing 14.8% of total capital inflows.
BRICS collectively represent 42% of the world’s population, 30% of global territory, and 28% of global GDP, with a combined economic value exceeding US$28.5 trillion. Additionally, the bloc facilitates about 20% of global trade, supported by an average GDP growth rate of 3.6%.
While Nigeria’s partnership with BRICS is poised to create new trade opportunities, the country’s reliance on raw materials for exports may limit its ability to compete effectively within the bloc. Diversifying its export base to include higher-value goods will be essential to address potential trade imbalances and maximize the benefits of increased market access. To align with BRICS policies and economic standards, Nigeria may also need to undertake significant structural reforms.
These adjustments, particularly in areas such as ease of doing business, fiscal discipline, and regulatory frameworks, could prove challenging given existing domestic constraints. Geopolitically, closer ties with BRICS might necessitate a delicate balancing act.
This partnership could realign Nigeria’s global alliances, potentially straining relations with Western nations that might perceive the shift as counter to their strategic interests. Additionally, deeper integration with BRICS economies could expose Nigerian businesses to competition from more advanced industries within the bloc, posing risks to local enterprises if sufficient protections and support mechanisms are not implemented. Finally, while access to BRICS development funds offers substantial opportunities for growth, there is a risk of over-reliance on external financing.
