Nigeria has seen significant improvement in the overall balance of payments, recording a surplus of US$2.80 million in the fourth quarter (Q4) 2018, compared to a huge deficit of US$4.54 billion in the third quarter (Q3) of 2018.
When compared with the corresponding period of 2017, it recorded a surplus of US$6.2 billion, according to the fourth quarter 2018 brief on balance of payments statistics, released on Tuesday by the Central Bank of Nigeria (CBN).
A Balance of Payment (BOP) is the record of all economic transactions between the residents of the country and the rest of the world in a particular period of time.
When a country’s BOP is in surplus, it means that such country is exporting more than it is importing. Consequently, Nigeria’s export earnings rose by 2.8 per cent to US$16.65 billion in Q4 2018 when compared with US$16.2 billion in the third quarter (Q3) 2018.
It also indicated an increase of about 27.6 per cent when compared to US$13.05 billion in the corresponding period of 2017.
Earnings from crude oil and gas, which accounted for 93.8 per cent of total export earnings during the review period, increased by 2.1 per cent to US$15.62 billion in Q4 2018 when compared with US$15.29 billion in the preceding quarter.
Earnings from non-oil and electricity exports increased by 15.0 per cent to US$1034.59 million in Q4 2018 when compared with US$899.36 million in the preceding quarter.
Available data from the CBN showed that payments for import of goods (fob) to the economy in the review period decreased significantly by 20.7 per cent to US$9.86 billion below the level of US$12.44 billion recorded in the preceding quarter. This was largely as a result of 19.9 per cent decrease in the imports of non-oil products.
Nigeria’s current account balance (CAB) improved from a deficit of US$1.54 billion in Q3 2018 to a surplus of US$1.10 billion in Q4 2018.
The financial account balance indicated a net acquisition of financial assets of US$2.33 billion in the review period as against a net incurrence of financial liabilities of US$4.61 billion recorded in the preceding period.
The current account indicated a positive outcome during the review period, recording a surplus of US$1.10 billion as against a deficit of US$1.54 billion and a surplus of US$3.65 billion in the previous quarter and corresponding period of 2017, respectively.
This development was largely attributable to the decrease in imports and payments on income (net).