In the News

Why does Nigeria import so much rice?

Graham Watson

3rd February 2017

This is a great article looking at the nature of the global economy and asking why Nigeria imports so much rice, given that it can be grown there, and what the implications of this are?

The government are worried about the issue of food security and have imposed a high tariff on imported rice. This, and a supply-side response to higher prices in 2009, has meant that there are more domestic suppliers.

However, I'm slightly concerned that the extent to which the government has intervened runs contrary to the exploitation of comparative advantage, and wonder why imports of rice pose such a threat to the stability of the domestic economy?

The real story is much more complicated: the Nigerian rice sector is small-scale and comparatively inefficient, and , if you read the article closely, you might become aware that the real reason for protection of the sector seems to be to do with protecting forex reserves.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to Tutor2U, reads voraciously and is interested in all aspects of Teaching and Learning.

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