The Effect of International Sanctions on Trade Relationships of Nigerian Firms with Sanctioned Countries

This research explores the effects of international economic sanctions, particularly those targeting Russia, Iran, and Venezuela, on the trade relationships of Nigerian firms that maintained commercial engagements with these countries prior to the imposition of sanctions regimes. Nigerian firms in sectors including fertiliser imports, petroleum equipment, and agricultural commodity trade have faced compliance dilemmas and operational disruptions arising from secondary sanctions risks, especially given Nigeria's access to the US dollar financial system and the extraterritorial reach of United States Office of Foreign Assets Control regulations. The study adopts a qualitative research design employing in-depth interviews with 25 Nigerian import and export executives, compliance officers, and trade finance lawyers with documented experience managing sanctions-related trade disruptions. Thematic analysis is applied. The theoretical framework draws on the international trade compliance literature and the political risk management framework. The study examines the compliance strategies adopted by Nigerian firms including sanctions screening, correspondent banking relationship management, and trade route restructuring. It also investigates the unintended consequences of sanctions compliance for Nigerian firms' trade financing costs and the availability of alternative supply chain sources. Findings are expected to reveal that Nigerian firms face disproportionate compliance costs relative to larger multinationals and lack access to adequate legal and compliance advisory support. Recommendations include development of a national trade sanctions compliance guidance framework by the Central Bank of Nigeria and trade ministries, alongside provision of affordable compliance advisory resources for SMEs. Keywords: international sanctions, trade compliance, Nigerian firms, OFAC, political risk