Nigeria’s non-export receipts are declining and it is a worrying development for the government especially in the midst of falling crude oil prices.
According to the latest quarterly Economic Report from the CBN, the value of Nigeria’s non-oil exports was put provisionally at US$960m in Q4 2019, indicating decreases of -41% q/q and -17% y/y.
The q/q decrease was largely driven by a sharp decline in export receipts from minerals and food products which stood at US$52m and US$50m respectively.
The sectoral breakdown shows that export receipts from manufactured products, agriculture and industrial sub-sectors declined by 16%, 23% and 3% respectively when compared with the previous quarter.
For full year 2019, receipts from non-oil exports totalled US$5.4bn.
The CBN’s commentary shows that export receipts from food products accounted for 5.3% of the total. The decrease in export receipts for this segment was largely driven by reduced exportation of fish, alcoholic and non-alcoholic drinks.
Analysts say the government has an urgent task to sensitize Nigerians on the country’s export potential and encourage state governments to focus on production of non-oil products in which they have competitive advantage.
As part of this, the Nigerian Export-Import Bank (NEXIM) is conducting an Exporter Enlightenment Programme across each geo-political zone. The programme is scheduled to kick off this month.
The federal government has made a provision of N2.5bn tax credit for non-oil exporters in 2020. The tax credit is not cash funded, but provided as a Negotiable Duty Credit Certificate. It is expected to bring some relief to non-oil exporters.
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