Nigeria’s total merchandise trade saw significant growth in 2024, driven by devaluation of the Naira and the expansion of exports.
Nigeria’s latest foreign trade statistics, published by the National Bureau of Statistics (NBS), revealed a remarkable 106.6 per cent year-on-year increase in total merchandise trade, reaching N138.03 trillion in 2024 from N66.83 trillion the previous year.
This surge was primarily driven by the devaluation of the naira and the expansion of exports, which stood at N77.4 trillion, surpassing total imports of N60.6 trillion. As a result, the trade balance improved significantly by 230.5 per cent year-on-year, rising to N16.85 trillion from N5.10 trillion in 2023.
Analysts noted that, “the substantial improvement in the trade balance can be attributed to robust export growth, bolstered by the weakened naira and an increase in exportable goods. This aligns with expectations that a larger trade surplus will contribute to a healthier current account balance in 2024, with crude oil production and exports continuing to play a crucial role in Nigeria’s economy.
“However, persistent foreign exchange pressures pose a downside risk, particularly concerning the services account, which may continue to widen.”
Cowry Asset Management Limited said, “in 2024, heightened volatility in the foreign exchange market led to a depreciation of the naira by over 41 per cent, enhancing the competitiveness and attractiveness of Nigerian exports on the global stage.”
A quarterly analysis of the NBS report indicated that Nigeria’s total merchandise trade stood at N36.60 trillion in Q4 2024, reflecting a 68.32 per cent increase compared to the N21.75 trillion recorded in the corresponding period of 2023 and a 2.20 per cent rise over the N35.82 trillion recorded in the preceding quarter.
In the period under review, exports accounted for 54.68 per cent of total trade, amounting to N20.01 trillion, representing a 57.67 per cent increase over the N12.69 trillion recorded in Q4, 2023, though slightly lower by 2.55 per cent compared to Q3, 2024 (N20.54 trillion).
An analysis of Nigeria’s trading partners highlighted that China remained the largest source of imports, with goods valued at N4.61 trillion, representing 27.80 per cent of total imports.
This was followed by imports from India at N1.89 trillion or 11.43 per cent, Belgium at N1.39 trillion or 8.35 per cent, the United States at N1.06 trillion or 6.36 per cent, and France at N601.28 billion, accounting for 3.62 per cent of total imports.
Cowry acknowledged the significant three-digit growth in total trade and trade surplus, largely driven by naira devaluation and a commendable rise in total exports, boosting foreign exchange earnings.
Looking ahead, the research firm stated that, “a sustained increase in the trade surplus is anticipated, underpinned by the expected expansion in Nigeria’s export volumes, particularly in crude oil, as refining capacity continues to grow.
“However, a rise in import volumes, facilitated by improved foreign exchange liquidity and greater accessibility to foreign currency, may reduce the trade surplus, potentially impacting the balance of payments and the current account.”
