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Nigeria’s Trade Deficit Widens

Nigeria’s Trade Deficit Widens

Nigeria’s trade deficit widens to N1.8trn in three months

Weak demand for Nigerian products increased the trade balance deficit to N1.87 trillion in the second quarter of 2021.

The National Bureau of Statistics (NBS) stated this in its “Foreign Trade Statistics – Q2 2021 obtained on Monday by Ripples Nigeria.

According to the report, Nigeria spent N6.95 trillion on imports but recorded exports worth N5.08 trillion.

What this means is that out of the N12.03 trillion trade merchandise recorded between April, May, and June, imports exceeded exports by N1.87trillion, which is the deficit.

NBS data however showed that trade recorded in the Q2 was 23.28% more than last quarter Q1 2021 and 88.71% more than the same quarter in 2020.

“During quarter 2, 2021 the total merchandise trade stood at N12,02 trillion representing 23.28% increase over the value (N9,757.87billion) recorded in Q1,2021 and 88.71% increase compared to Q2,2020,” NBS said.

Furthermore, NBS data shows that non-oil exports of N462.85 billion was recorded in the period under review. While crude oil/total exports constituted 80.29% of the transaction 42.22% was export/total trade.

“The export component of this trade was valued at N5.07 billion or 42.22% , the import was valued at N6,950.21billion or 57.78% while the trade balance stood at a deficit of N1,870.77billion.Crude oil which is the major component of export trade stood at N4,078.20 billion or 80.29% of total export. This further shows a sharp increase of 111.32% in Crude oil value in Q2, 2021 compared to (N1, 929.83billion) recorded in Q1,2021 while the Non-crude oil export recorded N1001.23 billion or 19.71% of total export trade during Q2,2021,” the report added.

Nigeria’s Trade Deficit Widens

For product classification, NBS said “total value of trade in agricultural goods in Q2 stood at N817.35 billion, with the export component totalling N165.27 billion while the import was valued at N652.08 billion.

“Topmost of these exported agricultural products were good fermented Nigerian Cocoa beans exported mainly to Netherlands (N16.48 billion), Malaysia (N9.32 billion) and the United States of America (N8.41 billion).”

For Solid Minerals, trade stood at N63.68 billion, with the export component at N14.93 billion while import was valued at N48.75 billion, with the top exported mineral products being cement exported to Niger Republic and Togo in values worth N3.12 billion and N2.32 billion.

For the manufactured goods sector, the value of trade stood at N4.51 trillion representing 37.50 per cent of total trade. The export component accounted for N211.67 billion while the import component was valued at N4.29 trillion.

“The products that drove up manufactured products were vessels and other floating structures for breaking up, which was exported to Cameroon in the value worth N71.90 billion.

“Vessels and other floating structures for breaking up were also exported to Spain and Equatorial Guinea in values worth N18.34 billion and N6.26 billion.

“In terms of manufactured imports, used vehicles were mainly imported from the United States and Italy in values worth N33.78 billion and N5.74 billion,” they said.

While in terms of Raw materials total trade stood at N904.51 billion, imports at N840.50 billion while the export component stood at N64.01 billion.

Asia is the leading partner with a record of N3.46 trillion or 49.92% with Europe with N2.30 trillion or 33.16% closely following.

America with N869.1 billion, Africa, N248.8 billion and Oceania, 58.1 billion. ECOWAS countries accounted for N24.2 billion.

On goods imported during the quarter, China led with a value of N2.078 trillion, followed by India with N570.01 billion, Netherlands with N557.16 billion, and the United States with N526.92 billion.

“In terms of regional trade, Nigeria exported most products to Asia (N1.84 trillion), Europe (N1.82 trillion), America (N806.81 billion) and Africa (N584.11 billion) while Oceania totalled N23.28 billion with goods worth N363.3 billion exported to ECOWAS.

“Analysis by country export trade showed that most goods were exported to India (N949.05 billion or), Spain (N524.49 billion), Canada (N355.60 billion) and Netherlands (N298.29 billion) and United States N256.63 billion,” NBS stated.

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Business

New Naira Notes Ready For Issuance- CBN

Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has said the newly redesigned Naira notes are already in banks and ready for issuance.

In a statement on its official twitter handle, the CBN quoted Emefiele to have made the disclosure in Daura, Katsina State, while on a visit to brief the president on the Naira redesign and the recently reintroduced cashless policy.

“The newly redesigned N200, N500, and N1,000 banknotes are now in banks and ready for issuance to members of the public,” the statement said.

The CBN governor clarified that the currency redesign and reintroduced cashless policies were not targeted at anybody but were for the good and development of the Nigerian economy, and urged Nigerians to embrace the various electronic channels available for banking and financial service transactions in Nigeria.

Emefiele further said the CBN deferred the cashless policy severally to prepare and deepen Nigeria’s payments system infrastructure.

He, therefore, advised Nigerians to take their old N200, N500, and N1,000 banknotes to the banks before the January 31, 2023 deadline.

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Business

NIBSS Says e-Payment Transactions Hit N38.9trn In November

The Nigeria Inter-Bank Settlement Systems (NIBSS) has revealed that transactions worth N38.9 trillion were performed electronically in November through the NIBSS Instant Payment platform (NIP).

This is the highest monthly transaction record on the platform.

Compared with the N34.5 trillion recorded in the preceding month, the November figure also shows a 12.7 per cent increase.

The latest data also shows that the November figure brought the total value of NIP deals in the last 11 months to N345 trillion.

Year on year, the e-payment value increased by 50 per cent compared with the N25.9 trillion recorded in November last year.

The value of the e-payment recorded was a reflection of the increase in the volume of deals within the month. The NIP volume rose to 492.2 million in November, showing a 53.8 per cent increase over the N319.9 million recorded in the same period last year.

The NIP is an account-number-based, online-real-time Inter-Bank payment solution developed in the year 2011 by NIBSS. It is the Nigerian financial industry’s preferred funds transfer platform that guarantees instant value to the beneficiary.

According to NIBSS, over the years, Nigerian banks have exposed NIP through their various channels, that is, internet banking, bank branch, Kiosks, mobile apps, Unstructured Supplementary Service Data (USSD), POS, ATMs, etc. to their customers.

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Business

CBN Insists It Won’t Reverse New Withdrawal Policy

Godwin Emefiele, Governor of the Central Bank, says there would be no reversal on the new cash withdrawal policy adding that the limitations was not intended to hurt anyone.

He disclosed this on Thursday following his visit to President Muhammadu Buhari in Daura, Katsina State.

The National Assembly had earlier faulted the CBN’s unveiling of revised cash withdrawal limits with a maximum of N100,000 for individuals and N500,000 for companies, claiming that it might worsen the current economic situation.

But while reacting to the objections from the National Assembly and the public outcry over the cash withdrawal policy, Emefiele said;

“And we think Nigeria, as the biggest economy in Africa, needs to leapfrog into the cashless economy.

“We cannot continue to allow a situation where over 85 per cent of the cash that is in circulation is outside the bank.

“More and more countries that are embracing digitisation have gone cashless,” he said.

He added that there would be no rigidity on the policy and no reversal, appealing to Nigerians to embrace the new policy.

According to the Governor of the CBN, the new naira notes have already been disbursed to the various commercial banks and expects that the banks would begin distribution to the public.

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