Nigeria - Country Commercial Guide
Construction Sector

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2021-10-13


                                                                                                                   Unit:       USD Millions





2020 (estimated)

Total Market Size





Total Local Production





Total Exports





Total Imports





Imports from the U.S.


177, 592.39

195, 000


Exchange rate: 1 USD





Total Market Size = (Total Local Production + Total Imports) – (Total Exports) 

Data Sources: National Bureau of Statistics; McKinsey & Company

Total Local Production: Estimated based on previous year trends

Total Exports: Estimated based on previous year trends

Total Imports: National Bureau of Statistics  

Imports from U.S.: U.S. Census Bureau 

Nigeria has a huge infrastructure deficit with total infrastructure stock in the country amounting to 30% of Gross Domestic Product (GDP), falling short of the international benchmark of 70% of GDP set by the World Bank. With Nigeria’s population growing at a rate of over 2.5% per annum, and an expected population of 400 million people by 2050, the current state of infrastructure in the country is likely to be overwhelmed in the near future. Some salient infrastructure challenges in the country include:

  • Insufficient road networks linking commercial centers across the country, posing an ongoing challenge to business operation; and
  • An insufficient stock of affordable housing for low-income earners.

Nigeria’s construction market is expected to grow by 3.2% annually between 2021 and 2025. This is coming at the back of a 7.7% decline in 2020 because of COVID-19 restrictions and a drop in demand for oil and gas – the main source of government earnings,

The World Bank has estimated that Nigeria would need to invest $3 trillion in infrastructure to reduce the infrastructure deficit in the country. The government of Nigeria (GON) has begun to take steps towards reducing the infrastructure deficit through increased spending as part of a 30-year infrastructure plan (National Integrated Infrastructure Master Plan) with a target date of 2043, which aims to bring Nigeria’s infrastructure stock to the 70% of GDP level.

Construction projects in Nigeria are driven by both the government and private investors. The government provides key infrastructure such as roads, bridges, dredged water ways and ports, and railways via several means including full government financing, public-private partnerships (PPPs), multilateral development banks (MDBs), and bilateral creditors. Due to the increasing cost of key infrastructure projects in the country and dwindling government financing, the government has made use of PPPs as a tool to finance projects for which the government was not able to secure debt financing. The GON received Senate approval to begin the process of securing about $22 billion in external loans for key infrastructure projects in the National Infrastructure Master Plan. Based on the proposed share of investment across critical sectors in Nigeria, the housing sector is expected to account for 11% of this fund while transportation will account for 25% of infrastructure investments.

In terms of housing, Nigeria currently has a housing deficit of 17 million houses.  It is estimated that the country needs to build a minimum of 700,000 houses per year to close the gap. However, Nigeria currently builds just 2,000 houses per year. In 2019, the Ministry of Works and Housing set aside a total sum of 19.8 billion naira ($55 million) for the construction of 2,383 units of housing across the 36 states of Nigeria under the National Housing Program. The GON has continued to keep its commitment towards reducing the housing deficit in the country by proposing an additional 60.8 billion naira ($160 million) expenditure for the housing sector in the 2020 budget. State governments have also embarked on projects aimed at providing affordable housing for citizens. The Borno state government has commenced an “owner-occupier” scheme for 2,787 housing units in the state. On May 28, 2020, the Governor of Lagos State commissioned 246 housing units in the Lekki area of Lagos State. Other states such as Delta, Ebonyi, Enugu, Edo, Ekiti, Gombe and the Federal Capital Territory (FCT) have all embarked on projects to provide affordable housing units for state government workers and other categories of citizens.

Financing and mortgage lending are increasingly significant in Nigeria as several financial institutions, including the Nigerian Mortgage Refinance Company, have increased their capacity in the affordable housing market through the provision of loans and advances of over $3.4 billion to customers. GON, in its bid to support the mortgage industry, waived initial 10% payments on mortgages below 5 million naira ($15,800) provided by the state-owned Federal Mortgage Bank. In addition, the GON has set up the Family Homes Fund, a $1.57 billion fund, to construct two million social housing units by 2020 through PPPs. However, the status of this project may be affected by the economic effects of the worldwide pandemic and drop in oil prices.

Private investors are also active in the construction sector through the development of projects aimed at residential customers and corporate establishments. Commercial estates are being built by private investors to meet the housing demand of high-earning citizens in high-end locations across Nigeria. Currently, residential housing unit developers in Lagos develop and sell properties in these areas of Lagos for as much as $ 1 million.

The largest deep seaport in West Africa is being built in Lagos via a partnership between Tolaram Group, Lagos state government, and the National Investment Promotion Commission (NIPC). The project is expected to cost $1.5 billion with a 16.5-meter water depth capable of berthing large vessels that are currently unable to berth in West African waters. This will increase the efficiency of ports in the country as higher numbers of goods can be imported and exported due to the larger capacity of the port. These construction projects have become a template for other states in Nigeria and the individual governments of these states have begun plans for similar infrastructure projects to boost their local economies.

GON is increasing its efforts to develop infrastructure and recently created a $2.7bn Infrastructural Corporation of Nigeria Limited fund backed by the Central Bank of Nigeria, Africa Finance Corporation, and the Nigerian Sovereign Investment Authority.

Leading Sub-Sectors

The construction equipment sub-sector as well as the building materials subsectors remain the leading subsectors in the construction industry.

Construction equipment such as dump trucks, excavators, dredgers, and graders continue to be major products purchased in Nigeria due to the presence of numerous ongoing projects. The equipment is bought new or used from manufacturers or dealers. Some equipment companies have implemented a lease-to-own service for their equipment. U.S. equipment is preferred in this subsector due to its durability, reliability, and sturdiness. Building materials are largely imported as Nigeria’s manufacturing sector for building products remains limited.


Due to the global pandemic, Nigerian GDP contracted an estimated 1.7% in 2020. However, the economy is expected to rebound in 2021 with a 2.4% growth rate. Following the Nigerian Senate’s approval of the President’s request for a $22 billion external loan for infrastructure projects, the short- and long-term growth of the construction sector was designated for housing and transportation (including roads), accounting for 11% and 25% each of the share of infrastructure investment needs in Nigeria.

Several major road projects were provided for in Nigeria’s 2020 budget. There are also plans by the GON, through the Federal Ministry of Works and Housing and the Infrastructure Concession Regulatory Commission (ICRC), to concession several road projects across Nigeria under the Highway Development and Management Initiative. The rationale behind this initiative is to ensure private sector engagement as an avenue to mitigate paucity of funds.

U.S. companies are welcome to participate in bidding for and partnering with key stakeholders on these projects due to the competitive advantage in terms of quality, reliability, and durability which they have over other suppliers.

For more information, e-mail: Adesina Anthony A., U.S. Commercial Service, U.S. Consulate General, Lagos, Nigeria at


Local Trade Shows

Nigeria Build Expo

Landmark Event Center, Lagos


BuildMacex Nigeria

Eko Hotel & Convention Center


The Big 5 Construct Nigeria