Based on the recent foreign trade statistics report from the National Bureau of Statistics (NBS), Nigeria recorded a trade surplus of N6.52trn in the first quarter (Q1) of 2024. Total merchandise trade was N31.81trn, an increase of 46.27% over the value recorded in Q4 2023 and up significantly by 145.58% when compared to the value recorded in Q1 2023. On trade classification, total exports stood at N19.17trn, making up 60.25% of total trade and an increase of 51% & 195% from N12.69trn & N6.49trn recorded in Q4 2023 & Q1 2023 respectively. Total imports amounted to N12.64trn, up 39.65% & 95.5% compared to N9.05trn & N6.47trn recorded in Q4 2023 & Q1 2023 respectively and making up 39.75% of total trade.
Looking at the exports breakdown, of the N19.17trn total exports, crude oil export contributed 80.8% (N15.48trn) and non-crude oil exports added about 19.2% (N3.68trn) of which non-oil products from agricultural goods, solid mineral, manufactured goods, and raw materials goods sectors contributed only N1.78trn i.e., only 9.29% of the total exports. Our top six export trading partners were France, Spain, Netherlands, India, United States, and Indonesia, – which accounted for over 51.71% of the nation’s exports. Also, the top 6 import trading partners accounting for over 56.05% of the nation’s imports were China, India, United States, Belgium, Netherland, and UAE.
Barring any strategic policy action from the Federal Government to increase importation of food to combat food inflation in the remaining quarters of 2023, we expect the balance of trade (BoT) to maintain a surplus. The devaluation of the local currency at the official window which has led to an increase in export value continues to drive export activities but discourages importation as imports become more expensive. However, the limited contribution of non-oil products to total exports highlights the nation’s over-reliance on crude oil (80.8%) for its export earnings. We reiterate the need to diversify export proceeds away from oil. Agricultural products like cocoa beans, cashew, and rubber are low-hanging fruits, considering the mass and quality of our arable lands.
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Source : CSL Research
