Beyond investment: Why the next decade of EU–Nigeria relationship must deliver Green Industrialisation

Beyond investment: Why the next decade of EU–Nigeria relationship must deliver Green Industrialisation

By Gboyega Olorunfemi

Recently, policymakers, investors and business leaders from Nigeria and Europe gathered in Lagos for the 10th Nigeria–EU Business Forum.

For decades, the relationship between Nigeria and the European Union has evolved considerably from development cooperation to trade facilitation, institutional reforms, and climate partnerships.

Despite Europe being one of Nigeria’s most important economic partners, one uncomfortable reality remains that Nigeria still exports raw materials and imports higher-value manufactured products in large quantities.

Therefore, the central question is no longer whether Nigeria and Europe should deepen economic cooperation; rather, it is whether this age long partnership can finally move from these declarations to implementation.

Across Africa, governments are increasingly embracing green industrialization as a pathway to economic development.

Rather than viewing climate action as a constraint, many countries now see it as an opportunity to attract investment, strengthen manufacturing, expand regional trade, and create jobs.

Nigeria is currently advancing its Energy Transition Plan, finalizing a Green Industrial Growth Strategy through combination of policies, expanding renewable energy investments, promoting electric mobility, and positioning itself as a manufacturing hub under the African Continental Free Trade Area (AfCFTA).

However, one can rightfully state that Nigeria’s challenge is not the absence of ambition but implementation gap. This is where the EU-Nigeria partnership must evolve to address longstanding challenge.

The European Union’s recent commitment of more than €560 million announced between the 8th EU- Nigeria Ministerial Meeting in March and the Nigeria -EU Business Forum in June, to support digital infrastructure, green enterprise development, and the Lagos Omi Eko Project underscores Europe’s growing confidence in Nigeria’s development potential and commitment to advancing sustainable, climate-resilient growth.

The next decade cannot be defined by discussions about investment opportunities alone, it must focus on building the institutions, market mechanisms, and industrial ecosystems capable of translating capital into productive transformation.

Therefore, three strategic priorities deserve urgent attention at this time and remain at the core of the Lagos Business forum outcomes:First, Nigeria and the European Union should negotiate a Clean Trade and Investment Partnership (CTIP).

Following its first Clean Trade and Investment Partnership with South Africa, Nigeria should become the second African country to benefit from such an arrangement through the EU’s strategic Trade and Investment Dialogue (TID) and the Global Gateway.

A Nigeria EU CTIP could focus on renewable energy technologies, battery manufacturing, electric mobility, sustainable fuels, transmission infrastructure, agro-processing, circular economy industries, and low-carbon industrial production.

More importantly, it would provide a coherent implementation architecture rather than the fragmented approach that often characterizes development cooperation.

Second, Nigeria should establish a Green Industrial Compact. One of the most promising innovations emerging from Africa’s energy transition efforts is the use of National Energy Compacts under Mission 300.

These compacts clearly identify investment needs, policy reforms, implementation milestones, and financing responsibilities while creating transparency and accountability for investors and governments alike.

It is highly recommended that Nigeria adapts this model to industrialization.A Green Industrial Compact would publicly identify priority sectors, infrastructure requirements, financing gaps, regulatory reforms, and measurable targets for implementation.

Such a framework would significantly improve investor confidence while helping development finance institutions and private investors align behind a common national vision for sustainable development.

Third, both partners must move beyond investment promotion and address market access and partnership through long-term offtake arrangements.

One of the least discussed barriers to green industrialization is the absence of predictable demand.

Europe can help address this challenge by supporting long-term purchasing arrangements for Nigerian green industrial products, including battery components, green fertilizers, processed agricultural goods, sustainable aviation fuels, renewable energy equipment, and other low-carbon products.

Such arrangements would provide the certainty required to unlock private investment at scale.

Another area where cooperation could be transformative is electricity infrastructure.

For decades, inadequate transmission and distribution systems have constrained Nigeria’s industrial potential.

Europe and Nigeria should therefore launch a Green Grid Partnership (GGP) focused on financing, manufacturing, and deploying transmission infrastructure, transformers, storage systems, and grid technologies.

This is on the backdrop that without reliable electricity, industrialization will remain an aspiration rather than an outcome.

To conclude, the global race for green industrial competitiveness is accelerating.

Europe is introducing new industrial policies, including the Carbon Border Adjustment Mechanism (CBAM) and emerging industrial preference frameworks designed to strengthen industrial competitiveness and strategic autonomy.

These measures can become fair and transparent drivers of global decarbonization if properly designed.

Therefore, this is not a call for exemptions for Nigeria, but for partnerships built on mutual benefit.

Nigeria should work with the EU to ensure that CBAM supports industrial decarbonization, local value addition, technology transfer, and competitive market access for Nigerian green industrial products.

That is why the next phase of EU-Nigeria cooperation should focus less on negotiating access to markets and more on jointly building the industrial capabilities that allow Nigerian firms to compete successfully in those markets.Nigeria cannot afford another decade of unrealised potential.

The legitimacy of the Nigeria-EU partnership over the next decade will not be measured by investment announcements; it will be measured by factories built, technologies transferred, skills developed, and jobs created – this is the ultimate scorecard that both sides will be measured.

Gboyega Olorunfemi is a Senior Research Associate, Centre for Climate Change and Development.

He is co-coordinator of the Africa–Europe Platform for Sustainable Development Thinkers (Ukȧmȧ) and is co-author of Green Industrialization Priorities in Africa and Partnership Opportunities with Europe