July 11, 2024

Nigeria’s regional trade declines, ranks 4th behind SA, Cote d’Ivoire, Egypt

Merchandise trade deficit rises 171% to N1.9trn

By Yinka Kolawole

Just three years into the implementation of the African Continental Free Trade Area (AfCFTA) agreement, Nigeria has started recording decline in its intra-continental trade as well as ranking in performance amongst the nations.

The Africa Export-Import Bank (Afreximbank) which disclosed this in its Africa Trade Report 2024, titled, “Climate Implications of the AfCFTA Implementation”, noted that Nigeria’s share of total intra-African trade dropped to about 4.2 percent in 2023 from 4.4 percent in 2022.

According to the report, Nigeria’s intra-Africa trade declined by 2.1 percent to $8 billion in 2023, from $8.2 billion in the previous year, placing fourth behind South Africa, Cote d’Ivoire and Egypt.

The report stated: “This decline led to a marginal reduction in Nigeria’s share of total intra-African trade, which dropped from 4.4 percent in 2022 to about 4.2 percent in 2023.

“Approximately 5.1 percent of Nigeria’s exports were directed to African countries, with Cote d’Ivoire, South Africa, and Senegal being the top three destinations for Nigerian exports within the continent.

Nigeria’s imports from the rest of Africa remained relatively low, accounting for less than 2.9 percent of its total imports,” the report stated.

Meanwhile, Afreximbank said the value of intra-African trade increased by 3.2 percent to $192.2 billion in 2023, noting however that this was a slowdown compared to the 10.9 percent growth rate recorded in the previous year.

The Afreximbank report estimated the export potentials for intra-African trade to have surpassed $69.4 billion in 2023, which suggests that the current level of intra-African trade could potentially rise to $261.6 billion, constituting 36 percent of total intra-African trade, all things being equal.

The report identified key products with significant export potential within Africa, including machinery, electricity, motor vehicles and parts, food products, minerals, beauty products, chemicals, plastic and rubber, ferrous metals, pearls and precious stones, and fertilizers.