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Four Consecutive Quarters of Trade Surplus

In the recently released Q3:2023 Foreign Trade in Goods statistics report by the National Bureau of Statistics (NBS), Total Trade in the quarter jumped by 54.62% Quarter-on-Quarter (QoQ) to NGN18.80trn from NGN12.16trn in Q2:2023. This surge is associated with similar growth in Total Imports (+47.70% QoQ to NGN8.46trn in Q3:2023 vs. NGN5.73trn in Q2:2023) and Total Exports (+60.78% QoQ to NGN10.35trn in Q3:2023 vs. NGN6.44trn in Q2:2023). On a Year-on-Year (YoY) basis, Total Trade made a rebound from its 11.81% YoY decline in Q2:2023, as it climbed higher by 53.16% YoY in Q3:2023 (vs. NGN12.28trn in Q3:2022). Consequently, we observed that Total Imports and Total Exports increased by 33.33% YoY and 74.36% YoY in Q3:2023. Furthermore, for the fourth (4th) consecutive quarter, Nigeria’s Balance of Trade position remained in the surplus zone, as it recorded an impressive 166.47% QoQ growth to NGN1.89trn in Q3:2023 (compared to NGN708.88bn in Q2:2023).

We maintain our stance that exchange rate depreciation will continue to help increase the value of proceeds obtained from Goods Exports in Q4:2023. Furthermore, the prolonged voluntary production cuts by major players like Saudi Arabia and Russia until year-end is expected to provide support to crude oil prices, thereby enhancing the value of Crude Oil Exports in Q4:2023. Notably, Nigeria’s oil production has commenced the quarter on a promising note, marking an increase to 1.42MMbpd in October 2023 from 1.40MMbpd in September 2023. Hence, barring any substantial disruptions to oil production, we are optimistic that this steady uptrend in oil production, coupled with the supportive factors in the global oil market, will contribute significantly to a favorable balance of trade surplus in Q4:2023

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