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Nigeria records N7-trillion trade deficit in 2020 as COVID-19 hurts export

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According to data published Tuesday by the National Bureau of Statistics (NBS), Africa’s largest oil producer posted a N7-trillion trade deficit in 2020, with exports falling as much as 35 percent.

Nigeria’s trade position was negative in 2020 as COVID-19 pandemic crushed oil demand, sending the revenue of oil-exporting countries tumbling.

That compares to a surplus of N2.23 trillion recorded in 2019, with imports outweighing the county’s value of exports. Crude oil exports fell to N9.4 trillion from N14.7 trillion in 2019, while Nigeria’s non-oil exports fell to N1.4 trillion from N2.52 trillion in 2019.

A trade deficit occurs when a country’s import exceeds its export during a given time period.

When that happens, the said country is denied the gains of foreign exchange, which comes from the exports of commodities to other trading countries.

Muda Yusuf, director-general, Lagos Chamber of Commerce and Industry (LCCI) notes:

“Whether or not the country is going to have a good trade balance depends largely on what happens to the oil and gas sector,

“The import had been somewhat steady because no matter what happens, we still have quite a number of imports, it is not as volatile as the exports,” he says.

“Oil prices are looking fairly good and if this is sustained, then we are largely to see a much better situation than what we had in 2020,” he states.

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Akinola
Akinola
Akinola Olusegun is a blogger and publisher of this blog, money247.com.ng. You can also check out his other blogs : segtv.com.ng (videos & news), letgoonline.com.ng (e-commerce), letgoonline.com.ng/blog (news) among others. Follow him via any or all of his social media pages to get fresh posts update.
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