Data in the External Sector Development Report for Q4 2012 by the CBN’s Economic Policy Directorate show that FX utilisation amounted to $10.2billion, compared with $9.7billion in Q3 and $10.4billion in the comparable year-earlier period.
These are the figures for deposit money banks (DMBs), and so exclude the transactions through the CBN and the bureaux de change. Food products and the oil sector together consumed $3.0 billion or 29.1% of utilisation. One obvious conclusion is that Nigeria should (and could) produce its own premium motor spirit (petrol) as well as crops such as sugar and rice.
We could claim an early success for the FGN programme of agricultural transformation from the modest decline in utilisation for food products to $1.2billion from $1.3billion in Q4 2011.
The decline for the oil sector is more impressive, to $1.8billion from $2.4billion. We have to note, however, that this decline does not reflect a steep increase in domestic production of petroleum products. It is the consequence of the reduction in the fuel subsidy in January 2012 and the subsequent audits of the industry to identify fraudulent imports.
Given its oil exports and the firm oil prices since 2010, it is no surprise that Nigeria posted sizeable current-account surpluses of $7.2billion in Q4 2012 and $23.4billion for the year (or 8.9 percent of GDP). We will examine the capital and financial accounts in a morning note later this week.
