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Nigeria’s 50% Export Drop Dips Sub-Sahara Trade

Tin Can Island Port
Posted: Oct 3, 2016 at 4:25 am   /   by   /   comments (1)

Kirk Leigh

Lagos – Declining oil prices, which punctured Nigeria’s export revenue along with slow growth in North Africa and continent-wide domestic and political turmoil, contrived to push down Sub-Saharan Africa exports, according to the World Trade Organisation (WTO).

Nigeria’s merchandise trade dropped to less than $50 billion in 2015 from a high of over $100 billion in 2011 according to the WTO World Trade Statistical Review (previously known as International Trade Statistics) released last week. Even though growth was relatively better in South Africa and Morocco, the region still suffered a 30 percent decline in dollar terms.

“Africa’s exports experienced a significant 30 percent decline in dollar terms in 2015. Accounting for about 40 percent of the region’s exports, sub-Saharan oil-exporting countries, such as Equatorial Guinea and Congo, were significantly affected by the 60 percent decline in oil prices.

“Nigeria saw a decline of almost 50 percent in its export revenues in dollar terms. This weakness was also due to a variety of other factors, including slow growth in North Africa and domestic and political turmoil. Growth in South Africa and Morocco was relatively better than the average for the region, with a less marked decline in the value of their exports.”

First hit by Nigeria’s oil price woes was the Economic Community of West Africa (ECOWAS), which is intrinsically linked to Nigeria’s economy, beating down contribution to world trade to a measly 0.5 percent in 2015 from 0.9 percent in 2012.

Sub-Saharan Africa is not the only regional economy in decline, according to the report. “Exports from emerging economies declined in 2015.  In particular, Argentina, Brazil, Bulgaria, Chile, China, Colombia, Hungary, India, Indonesia, Latvia, Lithuania, Malaysia, Mexico, Pakistan, Peru, Philippines, Poland, Romania, Russia, South Africa, Thailand, Turkey, Ukraine and Venezuela experienced significant declines.”

Total exports from this group of countries fell by 11 percent in 2015, bringing the total value of exports to about US$ 5 trillion, representing 30 percent of the world total. The largest among this group were Russia (32 percent), India (17 percent) and Brazil (15 percent), the report says.

Both China and Mexico were relatively resilient to the decline in exports compared with other developing economies, recording a fall of three and four percent, respectively. China, however, experienced a large decline of 14 percent for imports. Mexico’s decline in imports was not as drastic, falling by two percent.

The report singles out Asia and North America for praise as the best performing economies in trade terms.

“In dollar terms, Asia was the best performing region in 2015 followed by Europe and North America. Its overall merchandise exports amounted to US$ 5.961 trillion, followed by Europe’s US$ 5.958 trillion and North America’s US$ 2.3 trillion; the regions’ exports declined by seven, 12 and eight percent, respectively”.

Asia experienced the lowest regional decline in total exports in 2015, with a fall of seven percent. However, the larger Asian economies, such as Malaysia and the Philippines (net exporters of manufactured products), experienced a decline of 15 percent.

In summary, the report notes that in 2015, China retained its place as the world’s leading merchandise exporter and the United States the leading merchandise importer. The top five traders – namely China, United States, Germany, Japan and the United Kingdom – accounted for more than one-third of world trade while the top three countries accounted for more than one-quarter.

A fall in prices in international markets had a particular impact on Africa, particularly sub-Saharan Africa, other commodity exporters and regional trade agreements in general.

The United States remained the leading trader of commercial services. However, China, which ranked second, was the only economy with positive growth for both exports and imports. In 2015, all regions, with the exception of the Middle East, experienced declines in their exports of services.

Comments (1)

  • Honourable Joshua Pam Jackson Oct 3, 2016 at 4:42 am Honourable Joshua Pam Jackson

    due to Buhari’s bad economic policies. More will soon drop if Buhari keeps such evil policies.

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