Digital trade only works when goods can actually move. If delivery systems are slow, costly, or unreliable, online trade becomes harder to grow. The AfCFTA Digital Trade Protocol recognises this by paying attention not just to digital transactions, but also to the logistics and addressing systems behind them. In this piece, we look at what Nigeria’s current logistics framework and postcode system could mean for its digital trade readiness.
Logistics and last-mile delivery are a crucial link in the digital trade chain. It becomes most visible when a transaction starts online but must be completed offline, with a product that has to move across distance and reach a real address. If delivery is slow, unreliable, or too expensive, the promise of digital trade quickly turns into frustration, disputes, and refunds. The Digital Trade Protocol recognises this reality in Article 11 by setting out what State Parties should do to make delivery systems supportive of cross-border digital trade.
What the Digital Trade Protocol expects
The Protocol expects State Parties to improve the regulatory environment for logistics services in a way that supports market access and avoids discrimination. The emphasis is on laws that are applied reasonably and transparently, so logistics providers can operate without arbitrary barriers.
It also expects licensing to be simpler and faster. State Parties should streamline licensing procedures for logistics services and process applications promptly and fairly. In other words, delivery systems cannot support digital trade if entry into the market is slow, unpredictable, or tilted in favour of a few players.
Because digital trade is cross-border by design, the Protocol goes further than domestic reform. It calls on countries to promote transport coordination mechanisms with each other, improve infrastructure, support international multimodal transport, and develop standard and compatible transport rules that make cross-border logistics and last-mile delivery easier.
The Protocol also signals that competition matters. It expects regulatory decisions affecting logistics suppliers to be impartial and transparent, and it discourages policies that restrain competition. A delivery market that is closed or distorted will usually mean higher prices and poorer service for businesses and consumers.
Finally, it grounds all of this in basic infrastructure. State Parties are encouraged to adopt, maintain, or upgrade national addressing systems, postal systems, and related infrastructure, because last-mile delivery is only as effective as the systems that help a parcel find the right place, quickly and reliably.
Where Nigeria is today
A useful snapshot of where Nigeria is today comes from the United States International Trade Administration country guide on Nigeria’s logistics sector. It notes that the sector has grown steadily, supported by the expansion of e-commerce and rising demand for delivery and freight services. At the same time, it highlights persistent constraints, including weak transport infrastructure, high operating costs, and port and customs bottlenecks that slow down the movement of goods.
These frictions show up in global benchmarks. On the World Bank Logistics Performance Index, Nigeria still ranks in the lower half of the table, which reinforces the point that sector growth has not yet translated into consistently efficient logistics performance.
Licensing
Nigeria runs a fragmented system characterised by overlapping institutional oversight and layered compliance requirements. The primary regulator for courier services is the Nigerian Postal Service (NIPOST), acting through its Courier Regulatory Department, which is responsible for licensing, monitoring, and standard-setting for courier and logistics operators. Licences are issued based on the scope of operation, local, national, or international and are subject to periodic renewal as provided for in the Courier and Logistics Services (Operations) Regulations.
In addition to NIPOST, logistics operations are influenced by several other public authorities, including the Nigerian Customs Service, Federal Ministry of Communications and Digital Economy, the Federal Ministry of Transportation, aviation authorities, and state and local governments through transport permits and levies. While these frameworks are intended to ensure accountability and operational standards, licensing procedures remain rigid, expensive, and procedurally demanding, particularly for emerging international and local logistics providers.
As a result, access to international logistics licences is limited to a relatively small number of operators. This reality raises concerns under Article 11(1) and (2) of the Protocol, which call for a transparent, non-discriminatory regulatory environment and the streamlining of licensing procedures to facilitate market access.
Market reality
Although trade and e-commerce are growing exponentially even across borders, the high cost and restrictive nature of licensing have created a market structure in which many local logistics providers are unable to operate independently in the international space. Instead, they are compelled to partner with a small group of already licensed and internationally recognised logistics operators to facilitate exports and imports.
This dependency model limits operational autonomy. Partnering logistics companies are often required to adopt the rules, compliance standards, pricing structures, and delivery timelines imposed by licensed operators, with little room for flexibility or innovation. Consequently, businesses using these services have limited choice and reduced bargaining power.
Furthermore, because the number of licence-holding operators is significantly smaller than the number of companies reliant on them, capacity constraints emerge. Delivery timelines become uncertain, costs increase, and market competition is indirectly suppressed. Rather than encouraging innovation and diversity in logistics services, the current framework concentrates market power and restricts effective competition. These outcomes sit in tension with Article 11(4) of the Protocol, which cautions against regulatory practices that restrain competition and calls for impartial and non-discriminatory treatment of logistics service suppliers.
Cross-border reality
Cross-border delivery from Nigeria goes through two layers of rules: Nigeria’s export requirements and the import/customs rules of the destination country. Even after goods clear Nigerian Customs, they still must meet the laws and customs processes of the country they are being sent to. Because import rules differ widely across countries, exporters often face uncertainty and an extra administrative burden. This is especially difficult for Nigerian small and medium-sized enterprises (SMEs) and small-scale exporters.
Destination countries may also apply high duties, taxes, and clearance charges, which can raise delivery costs and make Nigerian goods less competitive. Where procedures are unclear or strict, shipments may be delayed, inspected repeatedly, or even refused entry.
Since only a few logistics operators have the capacity and approvals to handle multiple international customs systems, smaller exporters and logistics firms often depend on intermediaries. This can increase costs, reduce visibility over timelines, and concentrate the market in the hands of a few players.
These issues highlight the importance of Article 11(3) of the Protocol, which encourages State Parties to improve transport coordination, strengthen multimodal links, and align transport rules to make cross-border logistics and last-mile delivery easier.
National addressing system
Fixing Nigeria’s addressing system has been a priority for past and current governments. In 2017, a key milestone was the development of national guidelines to standardise how addresses should be structured and recorded, led by the NIPOST. These guidelines openly recognise that Nigeria’s addressing has historically been inconsistent and fragmented, and that this weakens service delivery and deliverability.
Since then, efforts have expanded in two directions. At the federal level, Nigeria has been rolling out a Local Government Proof of Address system designed to give residents verifiable addresses across the 774 local government areas, with several states publicly adopting the initiative. In parallel, the Nigerian Postal Service has developed address verification tools and has also unveiled a digital postcode initiative, signalling an attempt to modernise the national postal and addressing ecosystem. At the state level, Lagos has moved ahead with a digital house numbering and addressing programme that assigns unique identifiers to properties, aimed at making addresses easier to verify and locate.
Taken together, these national and state efforts show progress, but the goal is to translate these initiatives into actions that impact logistics positively so that delivery stops depending on landmarks and informal directions and becomes predictable enough to support digital trade at scale.
Next steps
The dependency model in Nigeria’s cross-border logistics market needs to be dismantled. Right now, high licence fees and heavy operating requirements mean only a small number of internationally licensed operators can play at that level, while local logistics firms are pushed into subordinate partnerships. If Nigeria wants digital trade to scale, the cost and structure of licensing should be recalibrated so it makes business sense for smaller, credible operators to enter, compete, and grow into international logistics over time.
Nigeria also needs to use its regional leadership more deliberately. In October 2025, Nigeria convened the first African Continental Free Trade Area Regional Digital Market Access and Regulators’ Roundtable with Egypt, Ghana, Kenya, Rwanda and South Africa, and established a Regional Digital Trade Regulators’ Working Group. That working group should become a practical platform for removing cross-border friction, including alignment on delivery-related standards, smoother corridor coordination, and predictable processes that reduce delays and costs for exporters and logistics providers.
Finally, last-mile delivery will not improve at scale unless addressing reforms move from “initiatives” to routine usage. Nigeria’s emerging tools, proof of address systems, digital postcodes, and state-level programmes, will only shift logistics outcomes if they become widely adopted by courier operators and platforms. That requires standardisation at the street and property level, including naming streets, fixing duplicate or confusing street names within proximity, and building simple integration so address verification becomes part of everyday delivery workflows. Incentives matter too. If government services and major platforms require standardised addresses, uptake will follow and last-mile delivery becomes more predictable for digital trade.
Rating Nigeria’s readiness
We rate Nigeria a 2.5 out of 5 (Developing). Nigeria has a growing logistics market and a formal licensing framework, plus early national and state addressing reforms. But cross-border capacity is still concentrated in a few operators, costs and bottlenecks remain high, and addressing systems are not yet widely standardised or adopted enough to make delivery consistently predictable at scale.
You can read part [0] on the Digital Trade Protocol series [here] and part one on digital identities [here]
Diana Uzor / Research Analyst, Technology and Digital Economy