Under the ‘command’ economic management of the retired Major General Muhammadu Buhari administration, the total foreign trade of Nigeria climbed by N58 billion in the third quarter of this outgoing 2019.
By foreign trade, we mean the value of the country’s exports and imports. It, however, rose from N8.60 trillion recorded in the second quarter of the year to N9.18 trillion in the third quarter.
But, the achievement of the Buhari administration did not seem to make any significant impact at slashing the country’s disturbing unemployment rate. Labour and Employment Minister, Chris Ngige, had announced last May that by this coming new year, Nigeria’s unemployment rate will reach 33.5 per cent.
Ngige who spoke while declaring open a two-day workshop on Breaking the Resilience of High Unemployment Rate in the Country in Abuja, the country’s capital, said that the incessant increase of unemployment in the country was alarming.
According to him, the high unemployment rate of 23.1 per cent, and underemployment of 16.6 per cent by the National Bureau Statistics (NBS) of 2019 report was alarming, pointing out, ‘’it is a worrisome status as the global poverty capital (World Bank, 2018); and concomitant high prevalence rate of crimes and criminality, including mass murders, insurgency, militancy, armed robbery, kidnappings and drug abuse, among others.
‘’As if this situation is not scary enough, it is projected that the unemployment rate for this country will reach 33.5 per cent by 2020, with consequences that are better imagined, if the trend is not urgently reversed. It is a thing of joy to note that Nigeria has not been resting on her oars over the years in terms of dedicated efforts to curb the unemployment problem.’’
The obviously dazed Ngige said various government social intervention programmes targeted at reducing youth unemployment and eradicating poverty have been implemented by different administrations since Nigeria gained independence.
He also said available records showed that from 1972 to date, about 14 different programmes have been implemented, adding that these programmes included the National Accelerated Food Production Programme (NAFPP), implemented between 1972 and 1973.
While the minister said others were the current National Social Investment Programme (NSIP) which has been ongoing since 2017, embedded in the National Economic Recovery and Growth Plan (ERGP) 2017-2020, he noted that yet, the unemployment rate and poverty levels are on steady paths of growth, indicating high resilience against the intervention efforts.
However, according to the latest foreign trade report released by the NBS, the total foreign trade increased by 6.67% within the quarter, a rise of N582.3 billion.
Nigeria’s value of the export rose significantly more than import. According to the foreign trade report, export component stood at N5.28 trillion, a 15.02% increase when compared to N4.59 trillion in Q2 2019.
On the other hand, Nigeria’s total import in the third quarter was valued at N3.89 trillion, a 2.70% drop against N4.01 trillion in the second quarter. The NBS report said the increase in exports coupled with the decrease in imports led to a positive trade balance of N1.38 trillion during the period under review.
Trade balance rose by 135.3% when compared to N590.4 billion recorded in the second quarter. Interestingly, Nigeria’s non-oil export rose faster than oil export within the period under review. Intangible terms, non-oil export rose by 374.5% from N227.6 billion in the second quarter to N1.08 trillion in the third quarter.
Significantly, the country’s total export trade rose in the third quarter, the biggest in the year. According to the report, the value of total exports in the quarter jumped by 15.02% compared to the level recorded (8.97%) increase in the third quarter of 2018.
The value of total exports in the third quarter of this outgoing year stood at N5.28 trillion. Crude oil export accounted for N3.74 trillion or 70.84% of total exports during the period under period. On the other hand, non-crude oil export grew significantly, valued at N1.54 trillion or 29.13% growth.
Sadly, while the value of agricultural exports decreased by 42.69% in the third quarter relative to the second quarter, the value of manufactured goods exports zoomed by 839.44% in the third quarter, when compared with the value recorded in the second quarter. Specifically, the export of manufactured goods accounted for N996.8 billion.
Those who know better say the amazing increase recorded in the export of manufactured goods was due to the re-exports of high-value cable sheaths of iron, as well as submersible drilling platform, Vessels and other floating structures.
Analysis of trade by region disclosed that Nigeria exported most products to Europe (N1.86 trillion or 35%), followed by Africa (N1.45 trillion or 27.6%), Asia (N1.36 trillion or 25.74%), America (N598.3billion or 11.3%) and Oceania (N8.1 billion or 0.1%).
Within Africa, exports to the Economic Community of West African States (ECOWAS) member-states was worth N1.14 trillion, or 21.56% of total exports. According to the statistics bureau, the value of exports to Africa and ECOWAS was notably high in the third quarter due to exports of Cable sheaths of iron and submersible drilling platforms exported to Ghana.
The country’s import nose-dived by N108.2 billion (2.70%) in the period under review and this was largely driven by a fall in the importation of solid minerals and other oil products. Solid minerals importation dropped by 31.73%. This is a clear indication that it was lower than the value in the second quarter.
While the value of other oil products imported decreased by 41.85% in the third quarter against the level recorded in the second quarter, the importation of manufactured goods grew by 12.46% in the third quarter of 2019 against the value recorded in the second quarter.
In the third quarter, the importation of energy goods increased by 243.92%. This was due to the rise in import of other wood charcoal, electrical energy and charcoal of bamboo. During the quarter, Nigeria imported goods mainly from Asia and valued at N1.99 trillion or 51.3% of total imports.
Other major imports originated from Europe, valued at N1.19 trillion or 30.6% while imports from the Americas and Africa amounted to N576.7 billion (14.8%) and N106.0 billion (2.7%). Also, import from Oceania stood at N23.8 billion (0.6%) of total imports while goods valued at N19.1 billion originated from ECOWAS.
Impressively, this latest foreign trade report shows some positives as Nigeria’s trade balance rose a high N1.38 trillion. This implies that the country’s trade balance (export-import) rose by N582.3 billion, and this was largely triggered by a fall in imports.
When a country’s exports are greater than its imports, it has a trade surplus. This implies Nigeria’s trade surplus rose within the period and this is good for the economy. Furthermore, the export of manufactured goods rose significantly, and this drove the country’s non-oil exports. This suggests the country’s diversification agenda may be yielding some positive results.
Unfortunately, despite the improvements in the country’s trade, agricultural exports suffered a major setback within the period. In the last quarter, the country exported only N42.1 billion worth of agricultural export, the lowest since the fourth quarter of 2017. This unequivocally means the country’s agricultural sector has continued to witness slow momentum for investors.
Again, in spite, the improvement in total trade, Africa’s most populous and polarized country is still largely an oil-dependent economy, since Nigeria’s oil export constituted 70.87% of total export revenue in the period.