Nigeria’s trade picture for Q4 2023 shows a mixed bag, according to the National Bureau of Statistics (NBS) report on Commodity Price Indices and Terms of Trade. While export prices edged up, import costs rose at a faster pace, leading to a slight decline in the overall terms of trade.
“The All-commodity group export price index on average increased by 0.57 per cent points in Q4 2023,” the NBS reported. This increase was primarily driven by higher prices for “prepared foodstuffs; beverages, spirits and vinegar; tobacco” and “live animals; animal products.” Notably, the report also highlights increases in exports of “vehicles, aircraft and parts, vessels” and products from the “chemical and allied industries.”
The NBS data reveals a more significant rise in import costs. “The All-commodity group import index on average increased by 0.79 per cent in Q4 2023,” the report states. This increase is attributed mainly to price changes in “mineral products” and “prepared foodstuffs; beverages, spirits and vinegar and tobacco.” Additionally, the report mentions “textiles and textile articles” and “papermaking material; paper and paperboard, articles” as contributing factors.
The combined effect of these price movements is a slight decline in Nigeria’s Terms of Trade (TOT). The TOT represents the relative value of a country’s exports compared to its imports. The NBS report states, “The All products Terms Of Trade (TOT) index on average decreased by 0.22 per cent points.”
Despite the slight decline in TOT, Nigeria’s export base appears geographically balanced. “The All-region group export index increased by 0.57 per cent mainly due to positive changes in the prices of exports to all economic regions,” the NBS highlights. Notably, the report identifies The Netherlands, India, Spain, Canada, and France as Nigeria’s major export destinations in Q4 2023.
