Nigeria’s foreign trade data low for Africa’s single market roadmap

An award winning comper, Olive Emodi(left); Commercial attaché for Nigeria at the US Embassy (David Russell); Chief Executive Officer, Shuttlers Damilola Olokesusi; Executive Director, FSDH Merchant Bank Limited, Taiwo Otiti; Founder/CEO, Money Africa Tosin Olaseinde; Managing Director/CEO, FSDH Merchant Bank Bukola Smith; Founder/CEO, MainOne Technologies, Funke Opeke; Managing Director, FSDH Asset Management, Toyin Owolabi and Founder, Immerse Coaching Company, Debola Deji-Kurunmi, at the second edition of FSDH Women in Business Initiative held in Lagos.

Nigeria’s trade in goods with the rest of Africa in about five years stood at N15.85 trillion, data obtained from the National Bureau of Statistics (NBS) have shown.
The figure covers 2018 till September this year. The value translates to 9.3 per cent of the country’s total foreign trade in the period, underscoring the low level of intra-African trade.

In the same period, the value of the country’s trade with members of the Economic Community of West African States (ECOWAS) averaged N1.42 trillion yearly, bringing the sum for the period to N7.09 trillion or 4.2 per cent of the total trade in the period.
Nigeria’s foreign trade was estimated at N170.27 trillion in the timeframe, with exports slightly higher at 52.6 per cent share of the nominal value.

The regional trade in the period reviewed was dominated by Nigeria, which aligned with the historical trend. Of the N15.85 trillion regional trade, exports totaled N12.76 trillion or 80.5 per cent while the country imported a paltry N3.09 trillion value of goods.
Also, goods brought into the country from other ECOWAS countries through official routes in the period accounted for 7.5 per cent of the trade value. The value was N528.6 billion whereas the country’s exports to the neighbouring countries were over 12 fold (N6.36 trillion).

The low intra-regional trade, as underpinned by the NBS figures is low, its growth is also anaemic at best and mostly retrogressive.
For instance, in 2019, the figure grew by almost 80 per cent to N5.03 trillion only to slump by 44.7 per cent the following year. Last year saw the value of trade between the biggest regional economy and other African countries improved slightly (6.6 per cent).

As at September, the value was N2.28 trillion, putting the annualised estimate at N3.04 trillion, which will be about 2.5 per cent higher than last year’s performance.
The African Regional Integration Index does not reflect efforts to push the single market and free-movement agenda in past decades, with foreigners said to be able to move more freely in the region than Africans themselves.

Averaging 0.383, trade integration on the African continent tends towards the lower rungs of the score ladder, the index said. It adds that Africa has the highest average import duties and the highest average non-tariff barriers in the world.
The African Continental Free Trade Area (AfCFTA) will be two years in a few weeks. Yet, full trading on the treaty has not commenced. There are more talks than actions about the planned African Union visa plan just as the single currency roadmap has been enmeshed in neo-colonialism. About 47 per cent of movement within Africa by Africans require visas while a few countries still need transit visas. The single air transport market is still a mirage as well. These are some of the challenges that have stalled African regional trade.
Whereas Nigerian-African trade continues to falter despite efforts to grow the figure in line with the single African market, Asia and Europe have continued to hold the most active Nigeria trade partners.
According to The Guardian analysis, trade between Nigeria and China, for instance, accounted for 13 per cent of the total trade value in a largely unbalanced relationship.
The total value of goods traded by residents of the two countries was N22.3 trillion, from 2018 till this year, with Nigeria’s imports from the Asian giant accounting for 88.2 per cent of the transaction.

Chinese exports from Nigeria were merely N2.6 trillion or 2.9 per cent of the value of the country’s total exports. On the flip side, Nigeria’s imports from the country, which is touted as the manufacturing machine of the global economy, accounted for 24.4 per cent of the country’s total import bills.

African countries do not feature in Nigeria’s top 10 trading partners. In the third quarter, for instance, the top trading partners (imports) were China, the Netherlands, India, Belgium and the United States. The five countries accounted for 58.84 per cent of Nigeria’s imports from July to September.
On the export side, the top partners were Spain, India, France, the Netherlands and Indonesia. Overall, the five top trading partners’ contributions to Nigeria’s import earnings in Q3 were 46.5 per cent.

The figures suggest the country has a huge concentration risk in export destinations as well as import sources. A serious shock from one or more of the countries, in the mold of the ongoing crisis in Eastern Europe, could cause a significant distortion in the country’s external sector.

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