BY BAMIDELE FAMOOFO
Total merchandise trade in Nigeria increased by 74.71% to N11.71trn in Q4 ’21 from N6.70trn in Q3’21. However, imports (N5.94trn) surpassed exports (N5.77trn) leading to a balance of trade deficit of N173.96bn.
In 2021, total imports were up 64.11% to N20.84trn compared to 2020, while total exports were up 50.99% to N18.91trn. This represents a deficit of N1.94trn with an improvement of 76.68%, from N7.37trn recorded in 2020. An improvement in trade balance will boost government revenue and external reserves accretion in the near term. This will further increase the CBN’s ability to keep the Naira stable.
Meanwhile, the country’s major export commodity, crude oil, which accounts for 74.04% of total exports, is facing significant threats. This could continue to keep the country vulnerable to oil price volatility, and worsen external imbalances and exchange rate swings in the near term. More so, the Russia-Ukraine war could negatively affect trade activities for the country as Europe accounts for about 37% of Nigeria’s foreign trade.
