Nigeria-South Africa Trade Hits $2.16bn As Energy Ties Deepen

South Africa eyes Nigeria as key oil supplier, records $1.22bn deficit as energy partnership strengthens bilateral trade.

The 2025 economic relationship between South Africa and Nigeria has emerged as one of Africa’s most strategically significant partnerships, with bilateral trade topping $2.16 billion despite a headline trade deficit for the Southern African nation.

New data released at the end of the 4th edition of the South Africa Week held in Lagos, showed the country exported $468.48 million worth of goods and services to Nigeria last year, while importing $1.69 billion — leaving a $1.22 billion deficit.

The event hosted by the South African Consulate General in Lagos, in partnership with Brand South Africa and the Development Bank of Southern Africa (DBSA) is as a strategic initiative aimed at fostering social cohesion between South Africans and Nigerians while positioning South Africa as a preferred destination for business, tourism, and education.

“The 2025 economic relationship between South Africa and Nigeria reflects a strategically significant, multi-dimensional partnership anchored in trade, energy security, investment flows, and strong institutional cooperation.

“While bilateral trade remains structurally imbalanced – with South Africa exporting US$468.48 million and importing US$1.69 billion, resulting in a US$1.22 billion deficit – this dynamic is largely driven by South Africa’s reliance on Nigerian crude oil, positioning the relationship as one of strategic interdependence rather than imbalance alone.

“This partnership is further elevated by the relative economic weight of both countries”, a statement by the organisers stated.

According to the International Monetary Fund (IMF) projections, South Africa’s economy is valued at approximately $443.6 billion, while Nigeria’s stands at around $334.3 billion in nominal terms for 2026.

As two of the largest economies on the continent, their bilateral engagement constitutes a central axis of African economic activity, with disproportionate influence on the success of continental integration efforts.

Beyond trade, the statement noted the relationship is reinforced by deep two-way investment linkages – South African firms -including MTN Group, Shoprite, and Standard Bank – maintain a strong presence in Nigeria, while Nigerian companies such as Access Bank and Paystack have established a growing footprint in South Africa.

Although investment flows were asymmetrical and some Nigerian firms have faced operational challenges, the organisers said these exchanges reflect an emerging bi-directional economic corridor that extends beyond goods trade into services, finance, and digital innovation.

Aligned with Brand South Africa’s mandate to build the country’s global reputation and competitiveness, the week-long programme would convene leaders from government, business, civil society, academia, and the media.

Meanwhile, South Africa is positioning Nigeria as its primary source of crude oil imports amid escalating geopolitical tensions in the Middle East.

Director, Africa Bilateral Economic Relations, Department of Trade, Industry and Competition, South Africa, Mr. Calvin Phume, disclosed this at South Africa Energy Week 2026. in Lagos, with the theme: “Repositioning and Promoting Energy Investments Between South Africa and Nigeria”

Phume said the shift was already underway for refined products, driven by the Dangote Refinery.

“Due to the US Israel-Iran war, there are discussions that most of our oil will come from here (Nigeria). But the discussions are at the highest level.

“We get a huge refined petroleum oil. So, it’s because of the Dangote Refinery. It has been helping us a lot in South Africa and the continent as a whole,” he stated.

He said bilateral trade between Africa’s two largest economies has surged since Nigeria gazetted its provisional schedule of tariff concessions under the African Continental Free Trade Area (AfCFTA) on April 15, 2025.

“You will recall that I did indicate Nigeria gazetted its provisional schedule of terminal concession of the AfCFTA on 15th April, 2025, last year. So, we were able to add Nigeria into the list of the countries that will benefit under the AfCFTA in August last year.

“So, since then, up until now, we have seen that there’s a huge increase of trade between South Africa and Nigeria, but it’s heavily skewed to South Africa now”, Phume stated.

He said between 2023 and 2025, South Africa’s exports to Nigeria rose 24 per cent from $355 million to $442 million.

In the last year alone, Phume said exports jumped 16 per cent from $380 million in 2024, “which can be attributed to a rise in exports of goods vehicles and fresh apples.”

According to him, in 2025, South Africa’s top exports to Nigeria included goods vehicles, fresh apples, polypropylene, mixtures of odoriferous substances, and food preparations.

“Iron and steel, because of our industrialized economy, we are able to manufacture the pipes that are required for the oil in Nigeria. So, it’s number three. And we also do some miscellaneous chemical products that are very important in the Nigerian market”, Phume said.

Conversely, South Africa’s imports from Nigeria fell 33 per cent from $2.3 billion to $1.5 billion between 2023 and 2025.

“This could be attributed to the drop in Nigeria’s overall crude oil exports in 2025,” he stated.

Despite the decline, he said crude remained dominant, explaining that in 2025, South Africa’s top imported products from Nigeria were petroleum crude oil, urea, refined petroleum oil, natural rubber, aluminum containers, and aeroplanes.

He pointed out that the AfCFTA has reshaped the balance of trade betwen the two nations, thwarting the historical advantage Nigeria used to have due to crude oil shipments.

Phume said: “Before, it was very skewed to Nigeria because of the crude oil. But since we have started trading under the AfCFTA, number one is oil and seeds, and the oligosaccharides, fruits, malaise, grains, seeds, fruit, industrial and medicinal plants, straw and fodder,” Phume said.

“While Nigeria enjoys a trade surplus in general, its trade with South Africa under the AfCFTA preference is heavily skewed in South Africa’s favour.

“Both countries would need to increase its efforts to encourage and support valued-added exports under the AfCFTA and maximize the new market.”

In her keynote, Deputy Minister of International Relations and Cooperation, South Africa; Ms. Thandi Moraka, emphasised the importance of strategic collaboration between Nigeria and South Africa to promote investment in energy infrastructure to catalyse production and guarantee energy security for their citizens.

She pointed out that a noteworthy example of Africa’s potential continues to lie in the energy and industrial development showcased in the Dangote Refinery.