Non-oil exports slide further by 25%

Nigeria’s non-oil exports further depreciated by 25 percent in the month of November 2015, representing a 75 percent decrease on a year-to-year basis, according to the latest monthly Economic Report released by the CBN.

The report provisionally puts non-oil exports at $244 million in the month of November, noting that the month-to-month decline was precipitated by fall in receipts from the food products and minerals sectors. Industrial products, which earned $79 million, accounted for the largest proceeds.

Going by the sector breakdown, proceeds from manufactured products, agricultural products and the industrial sub-sector grew by 13.3 percent, 13.5 percent and 38.3 percent, respectively, on a month-to-month basis. On the other hand, proceeds from food products and minerals decreased by 86.4 percent and 49.2 percent, respectively.

In the month of November, non-oil exports stayed very low at approximately 1 percent of GDP. The report stated that, “the agriculture and manufacturing sector, which underpinned non-oil exports in November, grew by 2.6 percent yearly and contracted by minus 1.8 percent in third quarter 2015, respectively. The national accounts are due for later this year.”

Following the release of the CBN report, the Lagos Chamber of Commerce and Industry (LCCI) has expressed concern over the difficulties in sourcing forex, which has affected “exporters, particularly for transport, logistics and the settlement of debt obligations. Furthermore, shipping companies, which play a vital role in the non-oil export process, are burdened with their own forex challenges.”

The institution also lamented that “apart from forex issues, the global economy has slowed down and demand for goods has softened. In January, the International Monetary Fund (IMF) trimmed its forecast for world output growth in 2016, from 3.6 percent to 3.4 percent. We would not be surprised if we see a moderation of earnings from the non-oil export sector in the near to medium term.”

Meanwhile, the acute scarcity of foreign exchange continued to be felt, as yesterday the naira closed at N389 against the dollar on the parallel market. The persistent fall of the naira was linked by the forex dealers to panic buying by importers, individuals and businessmen. Yesterday’s closure brings the naira to a record 20 percent lost in value on the parallel market in the last 10 days.

 

FRANK ELEANYA