Crude Oil Dominates As Nigeria’s Exports Rise By N10.57tn

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Nigeria’s export increased by N10.56 trillion between 2016 and 2018, as crude oil continued its dominance in the export sector.

The N10.56 trillion within the two years indicated an increase of 123.8%.

The nation’s exports stood at N8.53 trillion in 2016 and rose to N13.06 trillion in 2017, an increase of 34.69%.

At the end of 2018, the country’s exports stood at N19.09 trillion, signifying an increment of 46.17% over the value recorded in 2017.

Experts have expressed their worries over the crude oil dominance after the Nigeria Bureau of Statistics’ data showed that Nigeria recorded a positive trade balance of N5.93 trillion in 2018.

According to the NBS, value of trade was N32.26 trillion, that is, the import was N12.17 trillion while export was N19.09 trillion.

It added that the volume of total merchandise trade in 2018 was the highest recorded since 2014, nearly double pre-recession levels.

The fourth quarter of 2018 witnessed a fall in import. Imports fell to N3.59 trillion, representing a 14.99% quarter-on-quarter decrease.

The trend of export became popular sequel to the 2014 collapse in global oil prices which threw Nigeria’s economy into a recession in 2016.

The Executive Secretary, Institute of Export Operations and Management Nigeria, Ofon Udofia, said after the recession, orderliness in the Niger-Delta region restored stability in Nigeria’s oil export.

Udofia added that more people also went into the non-oil export.

 

Crude Oil Dominates As Nigeria's Exports Rise By N10.57tn 

He traced the trend to the recession aftermath and the various restrictions that the CBN placed on the dollar.

Many large firms that imported products could no longer depend on the Central Bank of Nigeria (CBN) for dollar allocation.

They started exporting their products to markets outside Nigeria to be able to get forex to import or repatriate to their home countries.

Despite the rise, exports during the years under review were dominated by oil.

In 2018, crude oil exports were put at N15.72 trillion, representing 82.3 % of the export trade.

Non-crude oil exports stood at N3.38 trillion, representing 17.7%.

Out of the non-crude exports, non-oil exports consisting majorly of agricultural produce were put at N1.9 trillion, representing 6.2% share of the export trade.

According to udofia, about 650 farms in Egypt, 1,600 farms in South Africa, 1,600 farms in Kenya and 300 farms in Ghana have the GAP while only one farm in Nigeria has been identified with it.

He said this made it possible for Ghana to purchase Nigerian products, rebrand them under their labels and display them in shops abroad.

He said, “When people buy products with global GAP certification, they are sure of them because they are regulated.

“We must have standards, train farmers so that our products can be export-ready. GAP standards require farmers having facilities in their farms to quarantine their produce.

“Another thing is the cost of exporting from Nigeria. Our charges are too high. Exports should be free of charges.

“Also, our infrastructure needs to be upgraded. Nigeria needs to have more seaport terminals dedicated to exports.”

The Director General, Lagos Chamber of Commerce and Industry, Mr Muda Yusuf, said unless Nigeria weaned itself from reliance on oil, it would not be able to pay attention to other exports.

He said, “We are not really exporting anything. The vulnerable position of Nigeria is always revealed when oil prices fall.

“Our economic survival is tied to the commodity market. That is why once the commodity market sneezes, Nigeria catches cold. This is a very precarious position to be in.

“We need to seriously think about diversifying our economy.”

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