A recent report by the Central Bank of Nigeria (CBN) on the Depository Corporation Survey report for August, has revealed that credit to the economy has declined by N900 billion or 2.27 % in August, primarily due to contraction in credit to the government during the month.
This finding was disclosed by Vanguard, and it revealed that credit to the domestic economy (Net Domestic Credit, NDC) fell by 2.27% from N39.57 trillion in July to N38.67 trillion in August 2020.
On the reason for the decline, the report stated that it was due to N730 billion or a 10.21% decline in credit to the government, which fell to N8.55 trillion in August from N9.52 trillion in July. The contraction in credit to the government was driven by a sharp fall in government borrowing through treasury bills (TBs), as total TBs held by investors dropped by N510 billion or 14.7%, from N3.48 trillion in July to N2.97 trillion in August.
The report further showed that credit to the private sector remains unchanged at N30.13 trillion as at the end of August, slightly higher by 0.24% when compared with the N30.06 trillion in July.
What this means
The flow of credit is paramount to the growth and sustainable development of any nation. Therefore, the current credit crunch might be as a result of a shortage of funds, an extension of an impending recession, or perceived fear of bankruptcies or defaults due to the impact of the pandemic.
Recall that Nairametrics had earlier reported on how N3.3 trillion was injected into the Nigerian economy through loans by Nigerian banks.
Top Agro food products exported by Nigeria in 2020
Here is a list of the top 10 agro-food products exported by Nigeria in 2020
Nigeria exported agricultural products worth N321.5 billion in 2020, representing a 19.16% increase when compared to N269.8 billion recorded in 2019 and a 6.27% increase compared to N302.28 billion recorded in 2018.
However, despite the increase recorded in export, imported agricultural goods surged by 78.58% in 2020 compared to 2019. Nigeria imported agricultural goods worth N1.71 trillion in 2020 as against N959.5 billion in 2019.
This is according to data tracked by Nairametrics Research from the foreign trade quarterly reports, released by the National Bureau of Statistics (NBS).
- In spite of crude oil, agriculture still remains the base of Nigeria’s economy, providing the main source of livelihood for most Nigerians. The sector remains the largest sector of the Nigerian economy and employs about two-thirds of the entire labour force in the country.
- However, production hurdles have significantly impeded the expected growth. According to the Food and Agricultural Organisation of the United Nations, over the past 20 years, value-added per capita in agriculture has risen by less than 1% annually.
- It is also estimated that Nigeria has lost about $10 billion in annual export opportunities from groundnut, palm oil, cocoa, and cotton alone as a result of the decline in the production of these commodities.
In line with this, it is pertinent to consider the major agricultural products that fetched Nigeria significant cash in 2020, in order to make adequate preparations towards maximising the country’s export potentials.
Sesame seeds – N98.27 billion
Sesame seed comes from a flowering plant mostly grown in Northern Nigeria due to the drought-resistant nature of the seed. It has many uses, but perhaps, its most important use is as a source of sesame oil which is the most demanded vegetable oil in the world because of its zero cholesterol content.
Nigeria has been one of the highest sesame seed-producing countries over the years, making the seed an important component of the country’s agricultural export.
In 2020, Nigeria exported sesame seed abroad to the tune of N98.27 billion. The highest quarterly export was recorded in Q1 2020 (N39.63 billion), before the heat of the pandemic, while the lowest was recorded in Q3 2020 (N15.59 billion).
Cocoa – N87.44 billion
Cocoa is a small perennial tree crop that primarily comes from the three tropical regions in the world; Southeast Asia, Latin America, and West Africa. Cote d’Ivoire is the single largest producer of cocoa beans, accounting for approximately 31% of the world’s supply.
The fruit is an egg-shaped red-to-brown pod that contains about 30 to 40 seeds, each of which is surrounded by a bitter-sweet white pulp. When the seeds are dried and fermented in the sun, they turn brownish red and are known as cocoa beans, which is the principal ingredient of chocolate.
In the year under review, Nigeria exported different variants of cocoa products to a sum of N87.44 billion. Good fermented Nigerian cocoa exported in 2020 was estimated at N45.36 billion, followed by superior quality raw cocoa beans at N36.53 billion, and natural cocoa butter at N3.52 billion.
Other variants of the cocoa product exported by Nigeria in 2020 include; other quality raw cocoa beans at N1.56 billion, other butter of cocoa and deodorised cocoa (N279 million) and roasted cocoa beans worth N190 million.
Cashew nuts – N45.88 billion
Cashew is a tree crop that has been cultivated for food and medicine for many years. The various parts of the cashew fruits are of economic value, which includes apple, nut, and kernel. The primary product of cashew nuts is the kernel, which is the edible portion of the nut.
In confectionery and bakery products, for example, kernels are used in the production of ice creams, chocolates, cakes, and sweets. Cashew nut shell liquid has also been used in making medicine used for treating various illnesses.
In 2020, Nigeria exported cashew nuts valued at N45.88 billion, with the highest quantity recorded in Q2 2020. The breakdown of cashew nut export shows that cashew nuts, in shell that was exported in the review year was N38.36 billion, while that which is shelled was valued at N7.52 billion.
Frozen foods – N7.78 billion
Nigeria exported various frozen food items in the year 2020, valued at N7.78 billion. Among the frozen food items exported in the period as stated by the National Bureau of Statistics were, other frozen shrimps and prawns, valued at N5.43 billion.
Frozen rock lobster and other sea crawfish (Palinurus spp, Panulirus spp, Jasus spp) stood at N1.98 billion while Hake (Merluccius spp, Urophycis spp), and frozen meat exported was valued at N374 million.
Shea – N6.47 billion
Shea fruits and nuts are “non-timber forest products” that are gathered annually during the shea tree fruiting season that extends from May to September. Shea fruits have an encompassed kernel and nut.
Oil and associated by-products are obtained from crushing the nuts, and these oils are used in creating shea butter, which is further used in making cooking oil, skin and hair moisturizer, soap, waterproof sealant for home walls, lamp fuel, and many more.
It is worth noting that Nigeria exported Shea nuts valued at N6.14 billion in 2020, while shea cake export stood at N337 million in the year under review.
- Ginger – N6.15 billion
- Sesame oil – N4.83 billion
- Soya – N3.53 billion
- Coconuts – N3.36 billion
- Flower – N1.58 billion
Why this matters
Nigeria is a country immensely blessed with rich soil texture idle for the practice of crop production; however, we are unable to produce as much for our domestic consumption not to mention receiving adequate export value for our agro products.
- It is no news that there is an international demand for most of Nigeria’s agro products; however, Nigeria spends more importing agricultural products from other countries.
- Some of the major bottlenecks impeding the expected growth in the agricultural sector, despite huge monetary interventions in the sector in recent years, include logistic problems, infrastructure, amongst others.
- According to a PWC report on the current state of Nigeria’s agriculture and agribusiness sector, Nigeria has significantly poor transport infrastructure and services (road and rail), particularly in the rural areas.
- It also identifies the lack of cold chain logistics as a factor contributing to the decrease in trade capacity through losses from spoilage and impinged time to market.
- The limited capacity of Nigeria’s seaport has also affected the ease of cross-border trade.
- Finally, there is a need for Nigeria to improve its agricultural production so as to tap into the large foreign exchange that could come into the country through the export of these items.
Bus fare in Nigeria surges by 78% YoY in February 2021
Fare paid by Nigerian commuters increased from an average of N208.89 recorded in February 2020 to N361.3 in February 2021.
The average fare paid by commuters for a bus journey within the city increased by 78.1% year-on-year in February 2021 to stand at N361.3. This is according to the transport fare watch report, recently released by the National Bureau of Statistics (NBS).
According to the report, the fare paid by Nigerian commuters increased from an average of N208.89 recorded in February 2020 to N361.3 in February 2021. This represents a 78.1% increase in price while it also increased by 2.6% compared to N351.15 recorded in the previous month.
Meanwhile, States with the highest bus journey fare within the city were Zamfara (N620.15), Bauchi (N530.10), and Ekiti (N475.25) while States with the lowest bus journey fare within the city were Oyo (N190.45), Abia (N208.55), and Borno (N250.72).
Also, the average fare paid by commuters for bus journey intercity increased by 1.13% month-on-month and by 39.85% year-on-year to N2,372.87 in February 2021 from N2,346.41 recorded in January 2021.
Average fare paid by air passengers for specified routes single journey decreased by 0.02% month-on-month and increased by 17.97% year-on-year to N36,458.11 in February 2021 from N36,463.65 recorded in the previous month.
- States with the highest airfare in February 2021 were Delta/Lagos (N38,600), Anambra/Bayelsa (N38,500), Bauchi (N38,400).
- On the other hand, Akwa-Ibom recorded the lowest fae in the review period (N32,500) followed by Sokoto and Gombe State with N33,600 and N35,000 respectively.
The amount paid by Nigerian commuters for journey by motorcycle per drop increased by 2.86% month-on-month and by 97.68% year-on-year to N266.74 in February 2021 from N259.33 recorded in January 2021.
- States with the highest journey fare by motorcycle per drop were Taraba (N436.20), Yobe (N425.02), and Kogi (N400.12) while states with the lowest journey fare by motorcycle per drop were Adamawa (N86.47), Katsina (N140.12), and Kebbi (N155.90).
The average fare paid by passengers for waterway passenger transport increased by 1% month-on-month and by 39.63% year-on-year to N794.02 in February 2021 from N786.19 recorded in January 2021.
- States with the highest fare by waterway passenger transport were Rivers (N2,299.35), Delta (N2,280.33), and Bayelsa (N2,258.49) while states with the lowest fare by water way passenger transport were Borno (N240.55), Gombe (N297.23), and Abuja FCT (N340.22).
What this means
The latest figure indicates that Nigerians are spending more on transportation despite the spike recorded in the food prices in the country, especially in the south. Nairametrics had reported that core inflation and food inflation rose to 12.38% and 21.79% respectively in February 2021.
Nairametrics | Company Earnings
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