Nigeria’s Q1 trade deficit rose by 175%, hit $764m – CBN

Authors:

Clinton Isidore

May 18, 2022 1:02 PM

The country has persistently recorded a trade deficit since the fourth quarter of 2019

Nigeria’s Q1 trade deficit rose by 175%, hit $764m – CBN

Data from the Central Bank of Nigeria (CBN), shows the value of Nigeria's international trade deficit rose by 175.13% from $152.94 million in January 2022 to $420.79 million in March 2022.

As stated on the CBN's website, the International Trade Summary shows that the total value of international trade stood at $28.77 billion in Q1 2022, while import was at $28.77 billion and export at $14.01 billion, revealing a total trade deficit of #764.69 million.

In January 2022, export stood at $4.74bn and import was at $4.89, showing a trade deficit of $152.94m.

In February 2022, the value of the trade deficit rose further to reach $190.96m, with export at $4.70bn and import at $4.89bn.

The trade deficit reached $420.79 million in March 2022, which saw export at $4.57 billion and import at $4.99 billion.

The CBN Governor, Godwin Emefiele, in June 2021 said the country will reduce its import bill in Q1 2022, mostly due to the functioning of the Dangote refinery, which is expected to reduce the country's importation of oil.

He said, “Of course for petroleum products, by the time the refinery goes into production by the first quarter of next year and the petrochemical plants we would have reduced our importation by about at least close to 35 per cent.”

However, the Dangote refinery is yet to be reported as being fully operational and functional.

The International Trade Show report read in part, “Owing to the deteriorating trade balance position, the country is increasingly exposed to external borrowing through Eurobonds and multilateral loans to shore up its external reserves. In 2021, the trade deficit widened to N1.9tn from N178.3bn in 2020.

“The country had persistently recorded a trade deficit since the fourth quarter of 2019 when the land borders were shut. However, maintaining a trade surplus consistently coupled with adequate inflows of foreign investments will contribute significantly to improving the net flows of forex through the economy – which crashed from $100.8bn in the first three quarters of 2014 to $44.5bn in the corresponding period of 2021.”

The report further stated that the nation's over-dependence on import hinders the CBN's ability to manage the country's need for foreign exchange.