Recent trends in Nigeria’s import trade dynamics have seen import values shrink since the last quarter of 2013, indicating that government’s policies to improve the country’s terms of trade are gaining traction.

These policies include the Agriculture Transformation Agenda, National Industrial Revolution Plan, backward integration programme, among others.

Imports into Nigeria have been falling for the two most recent quarters for which data are available (Q4 2013 and Q1 2014).

The National Bureau of Statistics’ (NBS) import figures for Q4 2013 show that imports fell by 19 percent from Q3 2013, recording a trade surplus of 20.3 percent for the period.

Nigerian exports in the first quarter of 2014 also rose by 14.2 percent from the previous quarter, while imports fell by 8.3 percent, resulting in a trade surplus of N2.4 trillion. Q1 2014 trade surplus rose to 35.4 percent, higher than the surplus for the previous quarter. Imports fell by 8.3 percent from Q4 2013, and 6.2 percent from the corresponding quarter of 2013.

Nigeria’s import figures have been falling markedly since the new Federal Government’s policy on rice, sugar (initiated in February 2013, but took effect in June 2013), fish, and most recently, the new automotive policy.

The policies, aimed at boosting the nation’s agric sector, have seen food imports fall by N2.5 billion in the last three years, according to Akinwumi Adesina, minister of agriculture and rural development, adding that Nigeria would surpass its target and produce 22 million tonnes of additional food by 2015.

“When we started in 2011, our aim was to produce additional 20 million tonnes of food to the existing production. As at the end of 2013, 17 million tonnes of additional food had been produced since 2011, and by 2015, 22 million tonnes of additional food would be produced,” said Adesina.

He said Nigeria was now the reference point for agriculture on the continent as the country was rapidly closing its food importation gap.

The new policies have seen a significant fall in the volume of those goods imported. Since the Federal Government imposed the new levy in addition to the import duty on rice imports, the Nigerian Customs’ rice-related annual revenues have fallen by at least 70 percent.

Prior to the implementation of the policy, rice imports accounted for between 70 percent to 90 percent of the Apapa Area One Customs Command’s monthly revenue.

Revenue generated from rice levies dipped by 90.6 percent, from N125.3 billion to N11.8 billion.

Charles Edike, Customs area controller, Apapa Area1 Command of the Nigeria Customs Service (NCS), said in an interview that the new import policy affected the revenue collection of the command.

“Fish, which used to be the second revenue source for the command, was also affected by the policy of government,” Edike said.

The NBS’ classification by section showed that the structure of Nigeria’s import trade was dominated by boilers, machinery and appliances (23.7 percent) mineral products (16 percent), vehicles, aircraft and parts (13 percent), base metals and articles of base metals (9.5 percent), and chemical and allied industries (8.5 percent).

At specific product level, motor spirit had the greatest value of imports, comprising 12.5 percent of total imports for Q1 2014, followed by spelt (common wheat) and meslin (a mixture of wheat/rye) at 3.5 percent, and machine tools at 3 percent of the total value of imports.

Wheat and wheat-related products, accounting for the second largest import commodity by value, highlights the degree of food dependency of the Nigerian economy.

This means that the Nigerian economy is still susceptible to fluctuations of food commodity prices on the international market. Increased wheat prices internationally will have knock-on effects for the FMCG industry and subsequently result in imported inflation.

Classification by broad economic categories showed that industrial supplies comprised 28.2 percent of total imports, followed by capital goods (22.3 percent) and transport equipment and parts (14.4 percent).

Nigeria’s trade surplus figures have acted as a boosting factor to the country’s macro-economic fundamentals. The value of the naira is expected to be stable in the near term, as demand for dollar eases, going by the analysis of the trade data. More accretion in the foreign reserves is also expected.