•Dollar and Naira notes
The importation of manufactured goods into Nigeria surged astronomically by 139 per cent, year-on-year (YoY), to N5.4 trillion in the first quarter of 2024 (Q1’24) from N2.40 trillion in the corresponding period of 2023 (Q1’23).
Stakeholders have attributed the development to the depreciation of the Naira and the competitive disadvantage of locally produced goods occasioned by the binding constraints confronting the manufacturing sector in the country.
Data obtained from the National Bureau of Statistics (NBS) Foreign Trade in Goods report for Q1’24 shows that the value of manufactured goods imported into the country has been on a quarterly upward trend from the beginning of 2023.
For instance, imported manufactured goods amounted to N2.40 trillion in Q1’23, rising to N3.02 trillion in Q2’23; N3.96 trillion in Q3’23; N3.97 trillion in Q4’23; and N5.74 trillion in Q1’24.
The rising trend continued every month in Q1’24 with imports at N1.60 trillion in January; N1.79 trillion in February; and N2.35 trillion in March 2024.
According to NBS, the value of manufactured goods traded in Q1’24 stood at N6.01 trillion, with N5.74 trillion imports representing 95.5 per cent while the exports component amounted to N268.70 billion, or 4.5 per cent.
Manufactured goods mainly imported were ‘Machines for reception, conversion and transmission of voice, images or data’ from China and the United States valued at N95.34 billion, and N34.00 billion, respectively. This was followed by ‘Heat exchange units’ imported from the United States valued at N91.29 billion.
Other goods imported in this category were ‘Motorcycles and cycles fitted with an auxiliary motor, petrol fuel, capacity >50<250cc, CKD’ from India with N73.59 billion and ‘Other Herbicides, anti sprouting products and plantar’ from China with N97.89 billion.
The President of the Manufacturers Association of Nigeria (MAN), Francis Meshioye, attributed the development to the inability of the country’s manufacturers to compete with their international counterparts due to factors bordering on high production costs.
He stated: “Nigerian manufacturers are saddled with high production costs, which ultimately push up the prices of manufactured goods.
“All these things are based on competitive advantages. The export base should be good enough to support the floating exchange rate, but we need to have a good economic base to do that.
“The government should look at why manufacturers cannot export as expected.”
Also commenting, the Director of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, said the rise in import figures is mainly due to the naira devaluation.
“I think it is because of the naira depreciation. If you are importing something that was $1 million when the exchange rate was N450 per dollar, now you are importing products worth $1 million, and the exchange rate is N1,500 per dollar,” he stated.
