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Nigeria’s trade balance weakens as oil prices bite

By on December 20, 2015

Nigerian exports plunged in the third quarter from a year ago and imports also fell, the National Bureau of Statistics said, as currency controls introduced by the Central Bank of Nigeria this year to support the economy start to bite.

The balance of trade in the third quarter was N645bn, down from N2.87tn in the third quarter a year ago.

Africa’s biggest economy relies on oil exports for about 58 per cent of government revenue. But the price of crude has been falling, reaching its lowest in more than six years last week.

Consequently, Nigeria faces its worst economic crisis in years, since exports of oil also bring in the hard currency that pays for imports. And because of its limited manufacturing, Nigeria imports most of what it consumes.

Nigeria’s exports fell by 50.3 per cent in the third quarter from a year ago and imports declined 7.3 per cent, the NBS said. The fall in crude oil exports, which accounted for 69.1 per cent of total domestic exports this year, hit the economy the most.

“The sharp decline in exports and slight decrease in imports contributed to a continued fall in the country’s trade balance, by 32 percent,” the NBS said in a report.

Crude exports fell 18.8 per cent in the third quarter from the second. Imports dropped 1 percent from the second quarter, the NBS said.
[Punch]