In its latest Quarterly Statistical Bulletin (QSB), the Central Bank of Nigeria (CBN) revealed that the total value of Nigeria’s merchandise trade declined by -10% quarter-on-quarter (QoQ) and -11% year-on-year (YoY) to US$23.5bn in Q2 2024. The trade figure comprises export and import trade positions of US$13.9bn and US$9.5bn, respectively. The external trade balance resulted in a higher trade net surplus of US$4.4bn compared with a net surplus of US$2.2bn in the previous quarter.
- Both export and import activities contributed to the q/q reduction in the overall value of Nigeria’s merchandise trade.
- However, the decline in import trade value was more significant, decreasing by -20% QoQ. On the other hand, merchandise exports fell slightly by -2% QoQ.
- Consistent with historical patterns, crude oil exports, which accounted for about 73% of the total value of Nigeria’s merchandise exports, decreased by -8% QoQ to US$10.1bn.
- In terms of non-oil exports, earnings from non-oil commodities declined by -1% QoQ but increased by +4% YoY to US$1.8bn.
- Turning to imports, the consistent reduction in Nigeria’s import bill can be attributed to the Naira depreciation stemming from ongoing FX liquidity bottlenecks. This has led to higher pricing of imported items, thus discouraging importers’ demand for products.
- A breakdown of the import trade figure shows that non-oil imports, contributing around 65% of merchandise import value, declined by -10% q/q to US$6.2bn.
- Notably, the trade value of petroleum products declined sharply by -36% QoQ and -34% YoY to US$2.9bn in Q2 2024.
- Looking ahead, we anticipate a further reduction in petroleum products due to the supply of refined petroleum products from the Dangote Refinery to the domestic market.
- Additionally, the Nigerian National Petroleum Corporation Limited’s (NNPCL) decision to fully deregulate the downstream oil market and eliminate fuel subsidies, which had reemerged, is also expected to reduce demand for imported petroleum products.
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