Nigeria at a glance
Nigeria, with a population of around 250 million, is advancing an ambitious diversification strategy to reduce oil dependence and strengthen industrial capacity. Fiscal reforms, infrastructure upgrades, and targeted investment policies are central to this shift.
The government has implemented measures to improve macroeconomic stability and investor confidence. Streamlined regulatory processes and digital platforms now facilitate approvals such as duty exemptions. Through the African Continental Free Trade Area (AfCFTA), companies in Nigeria gain access to a market of 1.4 billion people and projected consumer spending of USD 6.7 trillion by 2030, creating a strong base for export-oriented investments.
Incentives remain a core component to Nigeria’s investment strategy. Tax holidays, special economic zones, export mechanisms, and sector-specific benefits are being refined to increase impact. From 2026, the transition from blanket tax holidays to performance-based incentives under the Economic Development Incentive will further strengthen transparency and accountability.
Five pathways to lower entry costs
1. Tax-based incentives
The current Pioneer Status Incentive (PSI) offers up to five years of income tax relief for approved sectors. From 2026, the new Economic Development Incentive (EDI) will replace PSI with performance-based tax credits up to 25 per cent of qualifying capital expenditure over five years, subject to thresholds and compliance. Research and development deductions of up to 10 per cent of profit, alongside an additional 20 per cent investment tax credit, further support innovation. Together, these measures provide Swedish companies with clearer long-term planning conditions and a more transparent tax environment.
2. Sector incentives
Nigeria offers tailored benefits across priority sectors. Agriculture enjoys 95 per cent capital allowance and indefinite loss carry-forward. New mining firms receive a three-year tax holiday and 95 per cent accelerated capital allowances, encouraging exploration and processing. Manufacturing benefits from tax-exempt interest on export-linked loans, while tourism operators may exempt 25 per cent of income earned in convertible currency if reinvested within five years.
Additional incentives apply to energy, digital services, healthcare, and construction-related infrastructure projects. These targeted measures improve project viability, reduce early-stage risk, and make Nigeria an attractive market for Swedish companies in agri-tech, mining equipment, manufacturing solutions, and sustainable tourism.
3. Tariff incentives
Duty and VAT waivers reduce import costs for energy, health, agricultural, mining, and manufacturing equipment. Power-generation, agriculture, and mining equipment attract zero duty, while automotive assembly plants benefit from concessionary rates on completely and semi-knocked-down kits. A fully digitalised Import Duty Exemption Certificate process now speeds up approvals and improves transparency, offering a clear advantage for Swedish suppliers of industrial and clean-energy technology.
4. Export incentives
The Export Expansion Grant rewards non-oil exporters with Export Credit Certificates that can offset federal taxes such as company income tax and VAT. To qualify, companies must repatriate export proceeds within 300 days and meet value-addition and employment criteria. For Swedish manufacturers using Nigeria as a regional production base, the grant strengthens margins and competitiveness.
5. Special economic zones
Special Economic Zones offer full tax holidays, duty-free imports and 100 per cent foreign ownership. Export processing zones also waive import and export licensing requirements, expatriate quotas, and provide rent-free land during construction. Located near major ports, these zones offer efficient logistics and fast access to regional markets, making them well suited for Swedish companies seeking cost-effective operations and scalable operations.
Next steps
Nigeria’s evolving investment framework presents opportunities for Swedish companies looking to grow in West Africa. From tax credits to export support and duty waivers, the incentives are designed to reduce entry costs and support long-term success.
Business Sweden’s team in Nigeria can help you navigate the incentive landscape with tailored guidance, local insight, and practical support. Interested in understanding which incentives apply to your company? Contact Business Sweden to explore your options and get expert assistance every step of the way.
