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Nigeria’s Foreign Trade Still Very Oily

By United Capital Research

The National Bureau of Statistics (NBS) recently released its quarterly Foreign Trade in Goods Statistics, a data which shows the value of the country’s total exports and imports within a particular period, for Q1-2019.

Nigeria’s total export settled at N4.5 trillion, 3.9 percent lower compared to N4.7 trillion recorded in Q1-2018 but 1.8 percent higher than the level in Q4-2018.

Oil exports (86.7 percent) remains the largest contributor to the country’s total exports while agricultural exports contributed the least, accounting for a paltry 1.9 percent of the total exports.

On the import side, total goods imported into the country during the period settled at N3.7 trillion (up 3.4 percent and 25.8 percent relative to Q4-2018 and Q1-2018 respectively) with manufactured goods taking the largest percentage of 74.9 percent.

While sustained improvement in export is commendable with trade balance at a favourable N1.0 trillion for the period, we note that Nigeria import bill continues to rise at a faster rate than total exports (import rose 25.8 percent year-on-year while export declined 3.9 percent year-on-year).

Clearly, weaker growth in export is tied to the vagaries of oil output, due to its outsized contribution, despite a sustained uptick in prices over the period.

Again, this may also be traceable to output cap (1.76million/day) placed on Nigeria’s export by OPEC in December 2018.

Accordingly, we maintain our position that Nigeria must find a way to diversify its export base over the medium to long term to improve the trade balance.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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