Good Morning Nigeria: Merchandise imports stubbornly high
​Merchandise imports stubbornly high
Oil exports are the principal determinant of Nigeria’s current-account balance. Since they have slumped from US$20.0bn in Q3 2014 to US$10.1bn one year later, or from 14.0% to 10.1% of GDP over the same period, we should not be surprised that the trade account has deteriorated from a comfortable surplus before the slump in the price to a small deficit. The three other components of the current account are more stable: services and income (net outflows), and transfers/remittances (net inflow). The chart therefore shows that the small deficit on trade routinely becomes a larger deficit on the current account, which we forecast at 3.5% of GDP for the full year (2015).
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