Nigeria’s trade surplus witnessed a notable upswing, reaching N1.88 trillion in the third quarter of 2023, according to the recently released Foreign Trade Statistics report by the National Bureau of Statistics (NBS). The total merchandise trade value for Nigeria surged to N18.80 trillion during the same period, reflecting a quarter-on-quarter increase of 54.6% from the previous quarter’s N12.16 trillion and a 53.16% year-on-year (Y-o-Y) rise from the corresponding quarter in 2022.
Over a nine-month period, Nigeria’s total merchandise trade value stood at N43.01 trillion, with total exports outperforming total imports at N23.27 trillion and N19.74 trillion, respectively, resulting in a net trade balance of N3.52 trillion—an achievement not seen since 2018.
The trade surplus improvement to N1.88 trillion in the third quarter marks a significant milestone, aligning with Nigeria’s positive trade balance trend since the second quarter of 2018 when it reached N2.08 trillion. This comes as export earnings surpass the surging import bills, maintaining an upward trajectory in the total trade balance for the fourth consecutive quarter since Q3, 2022, after recording a trade deficit of N409.4 billion at that time.
The strong position in trade earnings is attributed to a considerable increase in trade activities, with crude oil exports leading the way at N8.54 trillion, constituting 82.5% of total exports. Non-crude oil exports contributed N1.81 trillion, accounting for 17.45%, and non-oil export products contributed 6.55% (N677.6 billion) to the total exports.
Meanwhile, the value of imports expanded to N8.46 trillion in Q3, 2023, with mineral fuels imports leading at N2.85 trillion, followed by machinery and transport equipment at N2.32 trillion, and chemicals and related products at N1.07 trillion.
Cowry Asset Management Limited analyzed the data, attributing the substantial upswing in trading activities to a resilient export performance, notably in crude oil. The surge was buoyed by favorable global oil prices exceeding $90 per barrel, a slight increase in domestic production, and the removal of fuel subsidies.
The emergence of a net trade surplus in Q3, 2023 is seen as a noteworthy deviation from previous quarters, showcasing Nigeria’s trade resilience amid global economic shifts. The positive development is linked to recent currency devaluation, enhancing the competitiveness of the country’s exports. The weakened domestic currency, combined with robust global oil prices, has positioned Nigeria favorably in the global market, potentially stimulating export volumes in response to escalating import costs. In essence, the Q3, 2023 trade landscape reflects a convergence of factors, including resilient crude oil exports, improved global oil prices, increased production, and strategic economic measures, shaping Nigeria’s adaptive response to the intricate dynamics of the global economic landscape.
