Nigeria’s Trade Deficit Widens as Exports Falling & Imports Rising

28 March 2022

Nigeria’s trade deficit is expected to get widened in 2022 as the performance of the country’s export sector has been on a downward slope. According to our database, Nigeria reported a trade deficit of US$ -19,648 million in 2020 and US$ -15,205 million in the first half of 2021. The rising trade gap between Nigeria’s imports and exports would impact its economy, which is the largest in the African continent. Let’s have a look at Nigeria’s imports and exports in past years and top-most traded commodities.

Nigeria’s trade balance by year

Nigeria’s trade balance has remained relatively healthy until 2019. The imports of the country were increased, while exports fell sharply in 2020. In the last 10 years, exports of Nigeria saw a growth till 2014, declined thereafter. From 2018, the value of shipments departing from Nigeria rose and decreased in 2020. And the imports of Nigeria started showing a rising trend from 2018. Till Q2 of 2021, Nigeria’s imports are higher than its exports. Analyze a detailed picture of Nigeria’s trade balance from 2011 to 2021 from data visualization. 

Nigeria’s trade by import commodity

Nigeria’s top import commodities are motor spirit, durum wheat, used vehicles, gas oil, and imported motorcycles & cycles. Below given chart shows the dollar amount of these products recorded in 2020 and 2021 (till Q2).

Nigeria’s trade by export commodity

Nigeria’s major export commodities are crude petroleum oil, liquefied natural gas, vessels & other gloating structures for breaking up, petroleum gases in the gaseous state, and urea. Below given chart shows the dollar amount of these products recorded in 2020 and 2021 (till Q2).

Nigeria’s Top Trading Partners

China is Nigeria’s top trading partner, accounts about 28% in imports and 5% in exports. Other major import sources of goods are the United States, Netherlands, Belgium, and Germany, while main export destinations are Spain, Netherlands, South Africa, and France. Check average trade percentages of these countries.

Russia-Ukraine War – Implications for Nigeria’s Food Importation

Russia’s invasion of Ukraine could affect food supplies to Nigeria and other African countries. Nigeria is Russia’s fourth-largest export partner of wheat, accounting for about 4% of total Russian wheat exports. Wheat is a major ingredient of Nigeria, used for the production of a wide range of food including bread, noodles, pasta, cakes, and many more. Russia and Ukraine put together are responsible for about 14% of global wheat production and control about 29% of all wheat exports.

Other than wheat, Nigeria also imports sunflower seeds, milk, and maize from Russia and Ukraine. Nigeria also imports different types of seafood such as herrings, mackerel, and blue whiting from Russia. As the war between Russia and Ukraine seems not to end sooner, its impact on food supplies to Nigeria and other African countries could be huge.

Nigeria ranks 2^nd in exports of Africa, and 3^rd in imports. The widening of the gap between Nigeria’s exports and imports (trade deficit) would certainly impact the country’s economy. Global inflation and shortage of food due to Russia’s invasion of Ukraine are major reasons behind the implication of Nigeria’s economy.