The country’s Gross Domestic Product (GDP) will grow by about $3 billion, if the country can reduce its imports.
The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, who, at the weekend, advocated for import substitution, noted that the importation of petroleum products alone makes up about 25 per cent of annual imports aside from other products that are high import.
According to the latest trade figures released by the National Bureau of Statistics (NBS), the country recorded a trade deficit of N3.94 trillion in the first quarter (Q1) of 2021.
Nigeria’s total merchandise trade, in the NBS report, stood at N9.75 trillion, representing a 6.99 per cent increase over the value recorded in Q4, 2020 and 14.13 per cent compared to Q1, 2020.
Similarly, the export component of this trade stood at N2.907 trillion, representing 29.79 per cent of the total trade while import was valued at N6.85 trillion, representing 70.21 per cent.
The higher level of imports over exports resulted in a trade deficit (in goods) of N3.943 trillion. The value of other oil products imported in Q1, 2021 was 19.02 per cent more than its value in Q4, 2020 but 15.76 per cent, less than the corresponding quarter of 2020.
Reacting on the data, Emefiele said: “from the last data that we have, importation of petroleum products makes about 25 per cent of the dollar value of our annual import. That is for petroleum. By the time we talk about fertiliser which is another high import product, plus wheat, milk and all the rest, it means that a lot of money is being spent.
“I keep asking, what is the contribution of imports to our GDP? The contribution of import to GDP is negative and if we can reduce our import by about $3billion annually, imagine how our GDP will gain. That is the science behind what we are doing. Reduce import and produce things that we can produce locally and consume them locally, thereby, promoting solid import substitution that will help this country and grow the economy.
Meanwhile, chairman of Dangote Industries, Aliko Dangote, said the company plans to export some of its products. “The total revenue we expect from if we have the petrochemical and fertiliser working is $23 billion annually.