The United States Trade Representative (USTR) has highlighted significant challenges in Nigeria’s business environment, citing rampant piracy, inadequate enforcement of intellectual property (IP) laws, and pervasive corruption as major obstacles deterring foreign investment.Â
These findings are detailed in the USTR’s 2024 National Trade Estimate Report on Foreign Trade Barriers.​
Piracy and Intellectual Property Enforcement
Despite Nigeria’s prominent role in Africa’s creative sectors, including film, music, and fashion, the USTR report underscores the country’s struggle with widespread piracy and weak IP enforcement. The prevalence of unauthorized digital content, such as pirated software and media, undermines legitimate businesses and discourages investment.​
The report acknowledges Nigeria’s legislative efforts to strengthen IP protection, including enacting the Federal Competition and Consumer Protection Act in 2019 and the Plant Variety Protection Act in 2021. More recently, the Copyright Act of 2022 was signed into law to align Nigeria’s IP framework with international standards. However, the USTR emphasizes that enforcement remains inadequate, with insufficient resources allocated to relevant agencies and a lack of public awareness about the importance of IP rights.​
Economic Impact of Piracy
Piracy’s economic toll on Nigeria is substantial. In 2019, the Nigerian Copyright Commission estimated annual losses of approximately $3 billion due to piracy in the music and film industries. The World Bank reported that for every legitimate CD sold in Nigeria, nine are pirated, indicating a piracy rate of 80% for international CDs and 40% for local products. These figures highlight the urgent need for effective IP enforcement to protect creators and attract investment.​
Corruption and Investment Climate
The USTR report also points to systemic corruption as a significant barrier to investment. U.S. firms operating in Nigeria have reported challenges related to opaque procurement processes and officials’ demands for facilitative payments. Such practices increase the cost of doing business and create an uneven playing field, deterring potential investors.​
While Nigeria has made some progress in opening government tenders to foreign firms, the report notes that more needs to be done to enhance transparency and accountability in public procurement.​
Government Initiatives and Recommendations
The Nigerian government has committed to strengthening IP rights protection in response to these challenges. Efforts include revalidating the National Intellectual Property Policy and Strategy Paper, which aims to address gaps and align with global best practices. Legal practitioners have also been urged to assist in combating piracy and raising awareness about IP rights.​
To improve the investment climate, the USTR recommends that Nigeria enhance the enforcement of IP laws, allocate sufficient resources to relevant agencies, and implement measures to combat corruption effectively. By addressing these issues, Nigeria can create a more conducive environment for foreign investment, fostering economic growth and innovation.​
