Nigeria’s trade with other African nations may have increased in naira terms, bringing it closer to the pre-COVID level.
But the value has declined by approximately 40 per cent in dollar terms due to currency devaluation.
The naira’s depreciation has made Nigerian goods more affordable for other African countries, leading to an increase in intra-African trade in naira terms.
Comptroller, Seme command, Nigeria Customs Service (NCS), Timi Bomodi, in a recent interview, had said that naira devaluation has positively impacted exports. He said because the value of the naira has declined, Nigerian-made goods have become cheaper within the region, encouraging people from neighbouring countries to purchase goods from Nigeria.
Data sourced from the National Bureau of Statistics (NBS) Q1 2023 Foreign Trade Statistics report, revealed that Nigeria imported goods worth ₦177.5 billion from other African countries (3.19 per cent of total imports for that quarter).
Exports trade by region in Q1, 2023 shows that Nigeria’s export to other African countries stood at ₦665.9 billion (10.27 per cent) of total exports, of which ₦339.19 billion worth of goods were exported to ECOWAS countries.
But in Q1 of 2024, export values to African countries stood at N2.24 trillion, while imports amounted to N401.83 billion.
Nigeria’s exported products in Africa mainly to South Africa (N957.06 billion), Ivory Coast (N744.59 billion), Senegal Republic (N361.29 billion), Benin (N55.67 billion) and Togo (N38.01 billion), representing 96.41 per cent of exports to Africa. Exports to ECOWAS member states totalled N1.25 trillion, while imports amounted to N113.04 billion.
While the figures from the first quarter of this year show an improvement when compared year-on-year to Q1 of last year, in dollar terms, it is a decline, fuelled by rising FX and a devalued naira.
Industry stakeholders have expressed worry over the drop in value of Nigeria’s intra-African trade as they said it brings to the fore again, the country’s vulnerability to global economic fluctuations.
While this presents an opportunity for local manufacturers, the Manufacturers Association of Nigeria (MAN) pointed out in its latest MCCI report that local production has become extremely difficult and expensive with rising inflation continually eroding the purchasing power of businesses, making it challenging for them to source inputs because of expensive FX.
