Nigeria’s Exports Grow By 63% to N1.873trn in Q2


• Crude oil contributes N1.5trn, non-oil, N380bn
• Negative trade balance widens

Obinna Chima, Emma Okonji in Lagos and Dele Ogbodo in Abuja
The total value of Nigeria’s export trade increased to N1.873 trillion in the second quarter (Q2) of 2016, representing an increase of N725.6 billion or 63.3 per cent, over the value recorded in the preceding quarter.

The National Bureau of Statistics (NBS) disclosed this in its foreign trade statistics for Q2 2016 that was released on Tuesday.
According to the NBS, the improvement in export value was largely due to the depreciation in the value of the naira.

It, however, pointed out that the structure of the export trade is still dominated by crude oil exports, which contributed N1.493 trillion or 79.7 per cent to the value of total domestic export trade in 2016.

Exports by section revealed that Nigeria exported mainly mineral products, which accounted for N1.735 trillion or 92.7 per cent of the total export value. Other products exported by the country included “animal and vegetable fats and oils and other cleavage products” at N55.7 billion or three per cent.

“Base metals and articles of base metals” at N28.4 billion or 1.5 per cent, and “prepared foodstuffs; beverages, spirits and vinegar; and tobacco” was at N16.2 billion or 0.9 per cent.

The export by direction showed that the country exported goods mainly to India, United States, Spain, Netherlands and South Africa whose values stood at N402.7 billion or 21.5 per cent, N235 billion or 12.5 per cent, N215.2 billion or 11.5 per cent, N133.3 billion or 7.1 per cent, and N119.9 billion or 6.4 per cent respectively.

In addition, the natural liquefied gas recorded N198.0 billion of the total export value during the period under review.
Export by continent showed that Nigeria mainly exported goods to Europe and Asia, which accounted for N611.7 billion or 32.7 per cent and N606.4 billion or 32.4 per cent respectively of the total export value during the period under review.

Furthermore, Nigeria exported goods valued at N265.9 billion or 14.2 per cent to other countries in Africa, while export to the ECOWAS region totalled N86.9 billion.

Meanwhile, the total value of Nigeria’s merchandise trade in Q2, 2016 was N3.942 trillion. This was 49 per cent more than the N2.645 trillion recorded in the preceding quarter.
This development arose from a rise of N725.6 billion or 63.3 per cent in the value of exports (largely due to exchange rate gains) combined with a rise of N570.8 billion or 38.1 per cent in the value of imports against the levels recorded in the preceding quarter.

The current trade position brought the country’s negative trade balance to N196.5 billion during the period under review. This showed a N154.8 billion reduction in the country’s trade deficit over the previous quarter.

Furthermore, it showed that Nigeria’s import trade stood at N2.069 trillion at the end of Q2, 2016, showing an increase of 38.1 per cent from the N1.498 trillion recorded in the preceding quarter. As with exports, the increase in import value was also traced to a decline in the value of the naira.

The structure of Nigeria’s import trade by section was dominated by the imports of “Boilers, machinery and appliances; parts thereof” which accounted for 34.9 per cent of the total value of import trade in Q2, 2016.

Other commodities, which contributed noticeably to the value of import trade during the review period, were mineral products (15.8%), vehicles, aircraft and parts thereof; vessels etc.(14.7%), products of the chemical and allied industries (7.6%) and base metals and articles of base metals (5.1%).

“The import trade classified by broad economic category revealed that capital goods and parts ranked first with N663.6billion or 32.1 per cent. This was followed by industrial supplies with the value of N421.2billion or 20.4 per cent and transport equipment and parts standing at N356.1billion or 17.2 per cent.

“The value of motor spirit stood at N296.1 billion. Nigeria’s import trade by direction showed that the country imported goods mostly from China, Netherlands, United States, India and the United Kingdom, which respectively accounted for N493.5 billion or 23.9 per cent, N285.7 billion or 13.8 per cent, N199.0 billion or 9.6 per cent, N124.9 billion or six per cent, and N119.3 billion or 5.8 per cent of the total value of goods imported during the quarter,” it added.

Further analysis of Nigeria’s imports by continent revealed that the country consumed goods largely from Asia with import value of N886.1 billion or 42.8 per cent. The country also imported goods valued at N813.9 billion or 39.3 per cent from Europe and N255.3 billion or 12.3 per cent from America. Import trade from Africa stood at N89.1 billion or 4.3 per cent, while imports from the region of ECOWAS amounted to N20.8 billion.

Telecoms Contribution Hits N1.58bn

Telecommunications activities in the country have continued to create positive impact in the Nigerian economy, adding N1,580 billion to the Gross Domestic Product (GDP) in the second quarter of 2016, or 9.8 per cent growth, which represents an increase of 1.0 per cent points relative to the previous quarter.

According to the statistics from NBS, this is the largest contribution to GDP made from this sector in the rebased period, which emphasises that growth in telecommunications has remained robust when compared to total GDP.
The last time that telecoms contribution to GDP rose as high as 9 per cent was in the second quarter of 2015, when it recorded 9.46 per cent growth.

Although growth in the telecommunications sector remained positive in contrast with the economy as a whole, year-on-year growth nevertheless dropped in real terms from 5.0 per cent in the previous quarter to 1.5 per cent, the lowest rate since 2011 Q3.

According to the statistics from NBS, the share of telecommunications in total real GDP had declined throughout 2010 to 2014, but for the last five quarters, growth in telecommunications has been higher, meaning the trend has reversed.

The NBS also released telecoms subscribers’ growth figure as at June 2016, which indicated that the total number of subscribers has increased rapidly over the past decade.
At the end of 2005, there were 19.5 million subscribers, but by the end of 2015, there were 151.02 million which is equivalent to an increase of 13.15 million every year.
However, growth has been declining more recently, possibly as a result of high market penetration leaving less room for large expansion.

In June 2016, the end of the second quarter, there were 149.8 million subscribers compared with 148.8 million in June 2015, which represents an increase of 0.69 per cent.
The yearly increase in total subscriber numbers has been decreasing steadily for the past year. In June 2015, the year-on-year increase was 12.05 per cent, however, after the decline in subscriber numbers between January and April 2016, the number of subscribers began to increase again, and in June 2016, the number was 0.71 per cent higher than at the end of the first quarter in March.

The increase is despite the sharp drop in Code Division Multiple Access (CDMA) subscribers. From June 2015 and June 2016, the number of CDMA subscribers fell from 2.1 million to 454,092, a decrease of 78.44 per cent.

Although CDMA remains the second most popular technology type, this decrease has meant that the GSM technology type has entrenched its position as the dominant provider of mobile subscribers.

The second quarter of 2016 saw a partial reversal of trends that had been recorded since August 2015. After declining between then and March 2016, the number of MTN and Etisalat subscribers began to increase again. The number of MTN subscribers rose from 57,045,721 to 58,409,767 between March and June 2016, and Etisalat subscriber numbers rose from 21,877,542 to 22,469,896 over the same period. These changes represent quarter on quarter growth rates of 2.39 per cent and 2.71 per cent respectively, although year-on-year growth rates were still negative, at -7.01 per cent for MTN and -1.67 per cent for Etisalat.

Airtel also witnessed a reverse in trend. In the second quarter of 2016, the provider recorded growth of -5.57 per cent, following consistent positive growth since August 2014. Nevertheless, the year on year growth was positive at 8.17 per cent and there was a slight increase between May and June of 0.44 per cent. Airtel ended the quarter with 31,978,848 subscribers.

By contrast, Globacom continued its uninterrupted growth in subscriber numbers. With the highest quarter on quarter growth and year-on-year growth rates of 4.95 per cent and 16.20 per cent respectively,

At the end of the second quarter, Globacom had 36,320,572 subscribers.
In the area of internet subscriptions, the figure from NBS revealed that of all GSM users, a total of 92.2 million had an internet subscription with one of the four carriers of Airtel, Etisalat, Globacom and MTN in June 2016. This means that of all the active GSM lines, 61.79 per cent had internet subscription.