Nigeria Records N6.95trn Trade Surplus In Q2 Despite Decline In Imports

Trade Surplus Reaches N6.95 Trillion in Q2 2024

Nigeria’s trade surplus for the second quarter of 2024 reached N6.95 trillion, according to the latest report by the National Bureau of Statistics (NBS).

This figure represents a 6.60% increase from the N6.52 trillion recorded in the previous quarter.

However, while the trade surplus grew, Nigeria’s total merchandise trade declined, dropping to N31.89 trillion—a 3.76% reduction compared to the first quarter of 2024.

The NBS report highlighted that despite the decrease in overall trade, the trade surplus was largely supported by steady growth in exports.

Export Growth Sustains Trade Surplus

“Nigeria’s total exports for the second quarter stood at N19.42 trillion, which shows a slight 1.31% increase from the N19.17 trillion recorded in the first quarter of 2024,” the NBS stated.

The value of exports is also significantly higher compared to the second quarter of 2023, marking a 201.76% rise. Crude oil exports continued to dominate Nigeria’s foreign trade, contributing N14.56 trillion, or 74.98% of total exports.

Non-crude oil exports, which include agricultural and manufactured goods, accounted for 25.02% of total exports, valued at N4.86 trillion.

“Non-oil products contributed N1.94 trillion or 10.01% of total exports in Q2 2024,” the NBS added. This reflects efforts to diversify Nigeria’s export portfolio but shows that crude oil remains the primary driver of trade surplus.

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Decline in Imports Amid Surplus Growth

While exports showed resilience, Nigeria’s imports recorded a decline. The report stated, “The total value of imports in Q2 2024 was N12.47 trillion, which is a 10.71% decrease compared to the N13.97 trillion imported in Q1 2024.”

This decline in imports suggests reduced demand for foreign goods, possibly linked to domestic production improvements or economic constraints on purchasing power.

Compared to the same period in 2023, however, imports surged by 97.93%. In Q2 2023, Nigeria imported goods worth only N6.30 trillion, underscoring the sharp growth in trade volumes over the past year despite recent quarterly fluctuations.

Impact on Nigeria’s Economy

Experts believe the increase in trade surplus is a positive indicator for Nigeria’s economy. Dr. Emeka Okeke, an economist, stated, “The growth in the trade surplus suggests that Nigeria is exporting more than it is importing, which is a good sign for foreign exchange inflows and overall economic stability.”

However, Dr. Okeke warned that the decline in imports could signal potential challenges ahead. “While it’s positive that Nigeria is exporting more, the sharp drop in imports could indicate issues with local production or purchasing power,” he said.

The rise in exports was largely driven by increased crude oil prices and sustained demand, while the drop in imports might be related to a slowdown in the global economy and internal factors such as currency fluctuations.

Prospects for Future Trade Surplus

Looking forward, economists have mixed opinions on whether Nigeria can sustain this trade surplus growth. With global uncertainties affecting oil prices and supply chains, maintaining a balance between exports and imports will be critical.

“Nigeria’s dependency on oil exports remains a vulnerability,” Okeke added. “Diversifying into non-oil sectors is important, but the current trend shows that it may take more time before non-oil products significantly contribute to the trade surplus.”

The NBS report concluded that while Nigeria has made strides in growing its export capacity, there is still a need for further diversification and strengthening of the non-oil sector to sustain trade surpluses in the long run.