The National Bureau of Statistics released Merchandise trade figures for Nigeria in Q1 2016, which indicated a 22.6% (N793.5bn) decline from the preceding quarter to N2.7trn. The decline was a result of the sharp fall in both exports and imports. The data revealed the following-
- Exports dipped N671.1bn (34.6%) to N1.3trn, while imports decreased 7.8% (N122.4bn) to N1.5trn
- Top 3 import items in Q1 were Motor Spirit which accounted for 15.6% (N226.2bn) of total imports for the period; Durum wheat 2.9% (N42.1bn) and Imported motorcycles and cycles, imported CKD by established manufacturers >50cc<=250cc 1.6% (N23.2bn)
- Top exports items included petroleum oils and oils obtained from bituminous minerals, crude N821.9bn, accounting for 64.7%; Liquefied Natural Gas N191.2bn (15.1%) and raw cocoa beans valued at N30.7bn (2.4%)
- China remained Nigeria’s top import destination with total value of N345.5bn, representing 23.8% of total imports. The U.S at N127.1bn (8.7%) and India N89.4bn (6.1%) make up the top 3
- Nigeria’s top 3 export destinations were India with value of N192.4bn, the United States N161.9bn and Spain N127.9bn
The drop in the value of exports could partly be attributed to the fall in crude oil production during the period on the back of the activities of pipeline vandals, leading to significant drop in crude exports from N1.5trn in the previous quarter to N821.9bn. Impairment in the value of imports for the period could be attributed to the FX constraints that businesses witnessed during the period, impacting their ability to source for necessary raw materials. This also affected the availability of petroleum products across the country during the period, fuelling the petrol scarcity.
That said, we do not expect significant improvement in trade figures in the coming quarter. This is because the constraints to trade in Q1 (pipeline vandalism and FX challenges) are also prevailing in Q2. The proposed adoption of flexibility in the FX market by the CBN if well managed should impact imports, but we can only expect such impact to trickle in from Q3. More so, the continued rise of militant activities as a matter of urgency, should be checked to prevent further impairment to the nation’s oil exports.
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