Driven largely by expected growth in the metal and minerals sector of the economy, the value of
Nigeria’s export to other countries is predicted to hit $127 billion by 2030, a new report has projected.
The report titled ‘future of trade’ by Standard Chartered, a global bank, said the country’s exports will grow annually by an average rate of 9.5 per cent between 2021 and 2030.
“This growth will be driven by activities in agriculture(4 per cent), metals and minerals (94 per cent), especially with the advent of the African Continental Free Trade Agreement, adding that by 2030, exports will constitute 20 per cent of the country’s Gross Domestic Product (GDP),” it said.
It said inclusion in the free trade area helps to facilitate trade in sectors ranging from fishery and textiles to automotives and electricals.
“Following this agreement, Nigerian exports to African markets outside of West Africa are expected to increase significantly, and reach markets such as Botswana, Egypt and Kenya,” it added.
Last year, the country recorded a trade surplus of N1.2 trillion compared to a deficit of N1.94 trillion in 2021 as the cost of exporting commodities exceeded the value of its import.
Data from the National Bureau of Statistics revealed that total trade was N52.4 trillion in 2022, 31.8 percent up from N39.8 trillion in 2021, of which total imports amounted to N25.6 trillion, while total exports were recorded at N26.8 trillion.
The standard chartered report also revealed Nigeria’s imports will hit $88 billion by the same period growth at an average annual growth rate of 4.8 percent while it is expected to constitute 14 percent of the GDP.
“The imports will be driven by the domestic demand for a wide variety of goods where Mainland China, the USA and India stand to benefit; the key import sectors include machinery and electricals, chemicals and pharmaceuticals automotive and transportation,” it said.
It said Nigeria currently imports approximately 70 percent of the medicines and vaccines consumed in the market, it is expected to continue to import pharmaceutical products to meet the growing demand for quality medicines, as consumer health awareness rises.
“As the market rapidly urbanises, demand for internet-connected devices is expected to continue rising. Additionally, increasing disposable income in the market’s population will further boost imports in this sector” it said.
For the automotive and transport sector, the report said the growth of used vehicle imports is expected to outperform that of new vehicles in the coming years, adding that the growing adoption of online marketplaces for used vehicles are expected to better connect bulk importers with consumers, facilitating greater trade.
Highlighting initiatives driving trade, it added that export diversification and expansion of non-oil sectors through supportive government initiatives, growing the country’s natural gas global market and increasing trade inclusivity of SMEs through financing support are key players.
According to authors of the report, the country as one of Africa’s top crude oil producers is well-positioned to become the biggest crude refining hub in Africa by 2025 as its expands its refinery capacity through greenfield expansions such as the Dangote refinery in Lekki and brownfield rehabilitation of state-owned refineries.
“Looking forward, India, Spain and Mainland China are expected to remain the largest destinations for Nigeria’s LNG exports. In addition, Nigeria is well-positioned to increase its share of natural gas exports to Europe,” they said.
They added that over the next decade, the Netherlands, Türkiye and India will remain Nigeria’s largest export destinations in the Agriculture and Food sector.