How does informal trade with Nigeria affect Benin’s trade balance?

Informal trade, which encompasses smuggling across the border with Nigeria, has contributed to Benin’s negative trade balance.1

While Benin relies on the export of agricultural products like cotton, palm oil, cocoa, and coffee to international markets, its economy faces challenges in maintaining a balanced trade account. The country’s primary port at Cotonou serves as a vital economic asset, functioning as a sea outlet for the Republic of Niger and a secondary port for Nigeria, which offers the potential to generate revenue through customs duties. However, the prevalence of informal cross-border activity continues to impact the nation's overall trade performance.12