Economy records $5.4b net forex inflow
...Food products’ importation gulps 13.2% of outflows
The nation’s economy recorded a favourable position in inflow-outflow foreign exchange transaction in January 2015, with a net inflow of $5.4 billion.
The aggregate foreign exchange flow through the economy, as contained in the Economic Report of the Central Bank of Nigeria (CBN), showed that total inflow was estimated at $9.47 billion, against a $4.07 billion outflow.
However, the total outflow represented a decline of 9.2 per cent and 19.2 per cent below the levels at the end of the preceding month (December) and the corresponding period of 2014, respectively.
The development, which was driven by the decline in receipt from crude oil sales due to the sharp fall in international crude oil prices, also showed that of the total inflow, receipts through the CBN and autonomous sources accounted for 31 per cent and 69 per cent, respectively.
But at $4.07 billion aggregate foreign exchange outflow from the economy, it represented a 4.9 per cent and 14.4 per cent fall below the respective levels in December and the corresponding period of 2014.
This however, resulted in a net inflow of $5.40 billion in the period under review, compared with $6.15 billion and $6.97 billion in the preceding month and the corresponding month of 2014, respectively.
Surprisingly, an analysis of the disbursement of the $4.07 billion aggregate foreign exchange outflow showed that the importation of food products gulped the bulk of 13.2 per cent in January.
The invisible sector accounted for the major part of the foreign exchange disbursement at 36.9 per cent, followed by minerals and oil sector, 21.7 per cent; industrial sector, 16.6 per cent; manufactured product, 8.8 per cent; transport, 2.6 per cent; and agricultural products, 0.2 per cent.
The report also showed that foreign exchange inflow and outflow through the CBN during the period under review was $2.93 billion and $3.97 billion, respectively, resulting to a negative position of $1.03 billion, compared with the net outflow of $0.88 billion and $2.11 billion in the preceding month and the corresponding period of 2014.
A further analysis of the inflow in comparison with the preceding month showed that it declined by 10.7 per cent, but indicated an increase of 15.4 per cent above the level in the corresponding period of 2014.
The development was again attributed to the decline in receipts from crude oil sales and swap transactions, while the outflow also plummeted by 4.8 per cent and 14.8 per cent below the respective levels in the preceding month and the corresponding period of 2014, owed to the slide in Retail Dutch Auction System’s utilization, drawings on letters of credit and other official payments during the review period.
The non-oil public sector inflow was put at $0.65 billion, representing a 6.9 per cent of the total inflow, declining by 20.1 per cent below the level in the preceding month, but was an increase of 277.5 per cent above the level in the corresponding period of 2014.
Autonomous inflow, which accounted for 69 per cent of the total, also failed by 8.5 per cent below the level in the preceding month.
However, the total non-oil export earnings estimated at $767.54 million, indicated a decline of 24 per cent below the level in the preceding month, but showed an increase of 102.5 per cent over the level in the corresponding period of 2014.
The development reflected, largely, the 89.7 per cent fall in export receipts from manufacturing sector, as further breakdown of the sectoral contributions showed that proceeds from industrial, manufactured, agriculture, food products and minerals sub-sectors stood at $658.52 million, $61.99 million, $36.75 million, $5.42 million and $4.86 million, respectively.
The contributions of industrial, manufacturing, agriculture, food products and minerals sub-sectors into the non-oil export proceeds represented 85.8 per cent, 8.1 per cent, 4.8 per cent, 0.7 per cent, and 0.6 per cent, respectively.