The Central Bank of Nigeria CBN has revealed that a total of $36.371billion was spent on the importation of petroleum products into the country in the last five years.
CBN’s Director-in-Charge of Research, Mr. Ganiyu Amao, made this disclosure during a public hearing of the Hon. Datti Garba Muhammad- led House ad-hoc Committee investigating the state of the country’s four Refineries, their Turn Around Maintenance (TAM) to date and regular/modular licensed refineries.
Mr. Amao noted that excessive outflow of foreign exchange (forex) impedes the ability of banks to stabilize the naira through intervention in the forex market.
According to him, a lot of pressure is exerted on the country’s external reserves causing the naira to depreciate.
While making his presentation, Amao revealed that data from the CBN show that from 2013 to 2017, a total of forex committed to imports in the country stood at $119.409billion, while the total forex committed to imports in the oil sector stood at $36.371billion, representing 13.5 percent of all imports made by the country.
In his words:
“It greatly exerts serious pressure on our external reserve and depreciates the value of our local currency.”
He further added that the domestic fuel consumption rose from 4.5 million metric tons (MT) to 23.9million metric tons in 2013, and dropped to 2.6million MT in 2016. In addition, he also disclosed that the CBN would be receptive of a policy that mandates International Oil companies (IOCs) to refine at least half of the crude that they produce for domestic consumption.
The government has promised to stop the importation of refined oil into the country by next year.