Nigeria’s total trade deficit increased to N3.94tn in the first quarter of 2021 amid slow economic recovery from the Coronavirus, the National Bureau of Statistics disclosed in a recent report.
The report, ‘Foreign Trade in Goods Statistics Q1 2021’, showed that the country’s total value of merchandise in Q1 2021 rose by 6.99 per cent to N9.76tn relative to N9.1tn in Q4 2020.
Year-on-Year, the trade value increased by 14.13 per cent from N8.6tn recorded in Q1 2020.
The rise in trade during the review quarter was reportedly driven by increase in imports by 15.61 per cent to N6.85tn, while exports declined by 8.99 per in Q1 2021 to N2.91tn.
Analysis on the report also showed that the surge in imports compared with the decline in exports resulted in the sixth consecutive quarter of trade deficit in Q1 2021, the highest since 2011.
Commenting on the report, CSL Research noted, “The increase in total trade was broadly reflective of the gradual recovery in the global economy following the removal of the movement restrictions that characterised the second to fourth quarters of 2020 and the widespread rollout of vaccines across the globe, which has hastened recovery from historic economic blows caused by the pandemic.
“These have led to a rebound in the global economy and improved growth projections by multilateral institutions.”
Further analysis of the data revealed that the rise in imports was driven by increased patronage of manufactured goods from foreign sources, which were up by 18 per cent in Q1 2021 and 70 per cent Q1 2020 to N4.5tn.
“The decline in exports was on the back of lower earnings from crude oil exports (down 23 per cent q/q and 34 per cent y/y to N1.9tn) on the back of lower production levels due to compliance with Organisation of Petroleum Exporting Countries production cuts.
“Also, the emergence of the second and third waves of the pandemic, which resulted in renewed lockdown measures, undermined recovery. Although trade activities continue to recover, the recovery is not broad-based,” CSL Research added.
