Nigeria’s cost of importing commodities has again exceeded the value of its exports, resulting in a widening of its trade deficit to a record N4.6 trillion in the nine months of the year.
That is a huge trade imbalance when compared with a surplus of N2.8 trillion generated the same period last year, as Africa’s largest economy continues to grapple with a fall in both oil and non-oil export earnings worsened by the global corona virus pandemic.
Crude oil exports which account for more than half of Nigeria’s foreign exchange earnings, plunged by 37.4% to N6.9 trillion from N11.1 trillion in nine months period the previous year, the National Bureau of Statistics (NBS) reported.
Non-oil export was also down by 38% to N1.2 trillion from N1.9 trillion, while non-crude oil exports also suffered a huge decline to N2.4 trillion from N3.4 trillion last year.
On the other hand, Nigeria total import amounted to N13.9 trillion, up by 19% from N11.6 trillion last year.
Worsened by the pandemic, Nigeria’s trade balance has largely been unfavourable since the fourth quarter of 2019 when import outpaced exports, resulting in a trade deficit of N575 billion.
With imports far outpacing export, it means further starve of the much needed foreign exchange earnings and further pressure on the reserve.
It would also serve as big constrain for manufacturing companies looking for dollars to import key inputs as they would be forced to get greenback at the black market where the naira is sols for N482/$, according to data from abokiFX.com.
Total trade within the period stood at N23.2 trillion, down from the N26 trillion the same period last year.
Total export (N2.99 trillion) was 34.85% higher in Q3 2020 than N2.22 trillion recorded in Q2 2020, but 43.41% less than in N5.29 trillion recorded in Q3 2019.
Imported agricultural goods increased in value by 21.13% in Q3 2020 compared to Q2 2020 and 109.82% compared to the corresponding quarter in 2019.
Business Day, 08 December 2020
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