According to an analysis of Nigeria’s merchandise trade data, the nation’s trade balance has been on a steep fall, indicating that the country is heading towards trade deficit.
Trade balance, which is also known as balance of trade (BoT), is the country’s total exports minus its imports.
Daily Trust’s analysis of merchandise data released by the National Bureau of Statistics, NBS, in the last two years revealed that Nigerians were exporting less and if the trend is not reversed, imports may soon exceed exports, leading to trade deficit.
Some economists have also blamed the Central Bank of Nigeria’s, CBN, policy on foreign exchange forex, for triggering a reduction in exports in recent times.
An economist, who is also the Chief Executive Officer (CEO) of Ranka Development Consulting (RDC), Femi Olanipekun, explained that the country’s declining balance of trade has been largely behind the dwindling value of the naira over other international currencies.
Olanipekun advised that the current falling trade balance must be reversed before it assumed the status of negative trade imbalance and reduce the value of the naira further.
“Barriers to exports must be addressed urgently. We can’t keep consuming what other nations produce, while we don’t produce for other nations.”
He advised the federal government to close the trade imbalance between Nigeria and Asia, since the continent has emerged as Nigeria’s largest international trading hub.