Give reasons for the high volume of trade between Nigeria and Japan

Answer Details

Reasons for the high volume of trade between Nigeria and Japan

1. Complementary economies: the two countries produce different goods and each needs what the other has. Nigeria supplies primary products (crude oil, rubber, cotton, cocoa, timber and other raw materials) while Japan supplies manufactured goods, so exchange is mutually profitable.
2. Japan's demand for raw materials: being a highly industrialised but resource-poor country, Japan needs large quantities of petroleum and industrial raw materials, which Nigeria can provide.
3. Nigeria's demand for manufactured goods: Nigeria imports vehicles, machinery, electronics and other manufactures in which Japan specialises and which are relatively cheap and of high quality.
4. Japan's advanced technology and industrial capacity enable it to produce goods in large quantities for export to markets like Nigeria.
5. Efficient sea transport and shipping: both countries are well served by ocean routes and modern ports, making the bulk movement of goods between them cheap and easy.
6. Large Nigerian market: Nigeria's big population provides a wide market that attracts Japanese manufactured goods, while its foreign-exchange earnings from oil enable it to pay for imports.