Despite Nigeria increasing its total trade value to N71.89 trillion in 2023, the trade balance– which is slightly surplus is not enough to solve Nigeria’s foreign exchange problems, amid high demand for dollars findings have shown.
The trade balance is determined by the value of imports and exports in the country. When a country’s value of exports in a country is higher than imports, it trades surplus. However, when the value of imports is higher than exports, it is regarded as a trade deficit.
Studies have shown that more exports translate to increasing production, revenue generation, economic growth, currency appreciation, and job creation. On the other hand, importation can affect the gross Domestic Product GDP, inflation, and other economic indicators of a country.
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According to the National Bureau of Statistics data, the total value of imports amounted to ₦35.92 trillion while the total value of exports was recorded at ₦35.96 trillion. With both values being almost corresponding, the country’s economy might struggle to grow in the coming months.
Since the assumption of President Bola Tinubu in May 2023, there have been various concerns depleting the government’s attitude regarding foreign trade.
During his inaugural address, he said, “Our government shall review all their complaints about multiple taxation and various anti-investment inhibitions. We shall ensure that investors and foreign businesses repatriate their hard-earned dividends and profits home.”
However, several policies enacted by the president have stiffened transactions within Nigeria’s economy. The Minister of Innovation, Science and Technology, Uche Nnaji, said, last year October, that Nigeria must increase production, and lessen importation to solve its currency problems.
| Quartlay breakdown | Import | Export | Total trade |
| Q1 | N6.47 trillion | N6.49 trillion | N12.96 trillion |
| Q2 | N6.30 trillion | N6.44 trillion | N12.74 trillion |
| Q3 | N9.04 trillion | N10.35 trillion | N19.39 trillion |
| Q4 | N14.11 trillion | N12.69 trillion | N26.80 trillion |
| Total | N35.92 trillion | N35.97 trillion | N71.89 trillion |
Quarterly growth in Foreign trade
The total trade is 37.21 percent higher than the N52.39 trillion record at the end of the year in 2022. In 2022, the import value stood at N25.59 trillion, and total exports were recorded at N26. 80 trillion.
In the first quarter of 2023, Nigeria’s total trade stood at N12.05 trillion of which total exports stood at N6.49 trillion and total imports amounted to N6.49 trillion resulting in a surplus in the trade balance.
Nigeria’s total trade stood at N12.74 trillion for the second quarter of the year, with total exports of N6.44 trillion and total imports amounting to N6.30 trillion. The trade balance was surplus.
For the third and fourth quarters, the total trade stood at N19.39 trillion and N26.80 trillion respectively.
This means that N9.04 trillion was generated from imports while N10.35 was generated from exports in Q3 resulting in a surplus trade balance. Meanwhile, the trade balance for Q4 was in deficit with an import of N14.11 trillion and an export of N12.69 trillion.
Some of the countries Nigeria traded with are China, Netherlands, Spain, France, Singapore, India, Belgium, and the United States of America.
The ICIR has reported that Nigeria generated $3.91 billion as foreign direct investment in 2023, but this was only attracted by 11 of the country’s 36 states.
Kehinde Ogunyale tells stories by using data to hold power into account. You can send him a mail at [email protected] (jameskennyogunyale@gmail) or Twitter: Prof_KennyJames