Invisibles gulp largest share of FX utilisation in November, says CBN

The invisible sector accounted for the bulk (62.5 percent) of total foreign exchange disbursed in November, according to the economic report for the month of November released by the Central Bank of Nigeria (CBN).

This was followed by the components of the visible sub-sector including industrial sector 16.2 percent, manufactured products 9.0 percent, minerals and oil 6.4 percent, food products 3.9 percent, transport 1.3 percent, and agricultural products 0.7 percent.

Invisible sector consists of an international transaction that does not include an exchange of tangible goods. This includes customer service outsourcing, overseas banking transactions, and the medical tourism industry.

Aggregate sectoral utilisation of foreign exchange rose by 3.2 percent to $3.49 billion in November 2019, compared with the $3.39 billion in the preceding month.

Foreign exchange (FX) inflow into the economy amounted to $9.84 billion, showing an increase of 7.5 percent above the level at the end of the preceding month.

It, however, showed a decrease of 21.1 percent relative to the level at the end of the corresponding period of 2018.

The increase was as a result of 5.8 percent and 8.5 percent rise in inflow through the bank and autonomous sources, respectively.

Aggregate foreign exchange outflow from the economy, at $4.70 billion, fell by 12.2 percent and 21.3 percent below the levels in the preceding month and the corresponding period of 2018, respectively. The development was attributed mainly to the 12.9 percent decline in outflow through the bank.

Inflow through autonomous sources rose by 8.5 percent to $6.12 billion in November 2019, above the level at the end of October 2019. Outflow from autonomous sources, on month-on-month basis, fell by 3.9 percent to $0.39 billion, reflecting a decline in invisible and visible imports.

Accordingly, foreign exchange flows through the economy resulted in a net inflow of $5.14 billion in the review period, compared with $3.81 billion and $6.51 billion at the end of October 2019 and at the end of November 2018, respectively.

Total non-oil export earnings, at $455.37 million, indicated increase of 15.4 percent and 48.9 percent relative to the levels in October 2019 and the corresponding period of 2018, respectively. The rise in earnings from non-oil exports in November 2019 was due largely to 3,797.7 percent increase in receipts from mineral sector to $78.88 million.

However, export receipts from food products and industrial sector fell by 10.3 percent and 7.2 percent below the levels in the preceding month to $9.41 million and $188.02 million, respectively.

Proceeds from the transport subsector also fell by 0.01 percent below the level in the preceding month to $0.04 million.

The shares of the various sectors in non-oil export proceeds were: industrial sector 41.3 percent, agricultural products 30.5 percent, minerals 16.2 percent, manufactured products 9.9 percent, and food products 2.1 percent.

 

HOPE MOSES-ASHIKE