The latest data from the NBS in its Foreign Trade in Goods Statistics for Q4 2016 show the total value of trade as N5.29trn, representing an increase of 11% on the preceding quarter. Compared with Q3, the total export value was 28% higher at N2.98trn, and the import value 6% lower at N2.31trn. Thus a surplus of N670bn (US$2.20bn) was achieved, the first since Q4 2015. However, for the full year, total trade was estimated at N17.3trn with a deficit of N290bn. These customs data may tell a different story to the BoP series from the CBN, which is not yet available.
Crude oil represented 81% of total exports in the quarter. In Q4, OPEC introduced production cuts for members (excluding Nigeria, Libya and Iran), which pushed oil prices above US$50/b. Additionally, improved oil production was recorded as a result of reduced sabotage.
In the quarter under review, Nigeria exported goods (presumably non-oil products) valued at N464bn to other African countries; exports to ECOWAS countries accounted for half of this figure.
The decline observed in imports is not surprising, given that the economy is still struggling with the recession. Furthermore, apart from fx illiquidity slowing import activity, there seems to be some improvement with local substitution.
Sources: National Bureau of Statistics (NBS); FBNQuest Research
Last year as a whole, import trade was dominated by mineral products, machinery and transport equipment, and chemical and related products.
Local substitution will play a key role in pushing Nigeria towards becoming more export oriented and less dependent on imports. The process is underway although not moving at the desired pace.
