Despite the coronavirus pandemic breaking out in China and the subsequent reduction in movement of goods to and from the Asian country, Nigeria still imported more goods from China than any other country in the world, data from the National Bureau of Statistics have indicated.
In its third quarter 2020 foreign trade in goods statistics, the NBS reported that goods worth N1.6tn were imported from China, representing 30.51 per cent of total import.
The third quarter statistics, (N1.6tn in imports) show that at the height of the pandemic, Nigeria imported more goods from China than it did in preceding months.
In the second quarter of 2020, Nigeria imported goods worth N1.3tn-(31.41 per cent of total imports) from China. In its trade and development report published in March 2020, the United Nations Conference on Trade and Development observed that indicators on shipping suggested a reduction in Chinese exports for the month of February.
Container vessel departures from Shanghai were substantially lower in the first half of February with an increase in the second half. “However, the Shanghai Containerized Freight Index continues its decline thus indicating excess shipping capacity and lower demand for container vessels,” UNCTAD stated.
Despite these pointers, Chinese products still dominated Nigeria’s import list, underscoring the huge volume of goods that enter into Nigeria from China every quarter. In 2019, Nigeria imported $4.48bn worth of machinery, nuclear reactor and boilers from China. Other imports such as electrical electronic equipment, vehicles other than railway tramway and articles of iron and steel, gulped a combined $3.8bn.
A report by Stears Group found that Nigeria imports more from China than Netherlands and South Korea combined.
The top imports of Nigeria are Refined Petroleum ($9.95bn), Special Purpose Ships ($4bn), Wheat ($1.64bn), Cars ($1.27bn), and Packaged Medicaments ($1.04bn) These are imported mostly from China ($13.4bn/), Netherlands ($5B), South Korea ($4.76B), Belgium-Luxembourg ($3.37B), and India ($2.76B). In 2018, Nigeria was the world’s biggest importer of Special Purpose Ships ($4bn), Jute and Other Textile Fibers ($58.4m), according to a report by an international trade research platform, Observatory of Economic Complexity.
In its report, Stears noted that Nigerian entrepreneurs made regular commercial pilgrimages to Chinese manufacturing centres like Guangzhou where Chinese traders have come to rely on them for bulk purchases. It revealed that among African nationalities in Guangzhou, the two countries with by far the most people are Nigeria and Mali.
Conversely, Nigeria is not listed among top 10 countries that export to China. The NBS report for Q2 and Q3 2020 confirms this. In Q2, export to China was N220.3bn, representing just 9.93 per cent of the total export trade. Of this volume; N189.9bn was crude oil while only N30.4bn was non-oil export. In the Q3 2020, the country exported N124.9bn worth of goods to China, representing 4.17 per cent of total exports. Out of this volume, N64.08bn was crude oil while N60.7bn represented non-oil exports.
Even within Africa, China imports more from Angola, South Africa, and the Republic of the Congo. China imported $1.5 billion from Nigeria in 2017, equivalent to less than 0.1% of its total imports, Stears noted.
The Chinese had insisted that the trade relationship between Nigeria and the Asian giant is mutually beneficial, but Stears confirmed the observation that Chinese goods flooded the Nigerian market in a way that was harming local businesses. “Nigeria does not import anything substantial other than oil and China does not buy so much of our oil,” the Director General, Lagos Chamber of Commerce and Industry, Dr Muda Yusuf explained.
He noted that this was the reason the balance of trade between Nigeria and China was always in favour of China. Commenting on Nigeria’s import from China during the height of the Covid-19, Yusuf said the movement restriction during the pandemic was mostly imposed on humans and not on cargo as cargo was still allowed to move.
On the currency swap with China that was created to ease the foreign exchange burden on Nigerian businesses, Yusuf noted that there had not been significant impact brought about by the currency swap.
He said the amount of about $3bn to be swapped over the period of three years was too small compared to the volume of trade between the two countries.
“When you compare the amount of money in the currency swap deal to the volume of trade, it is not up to 10 per cent,” he stated. He said, moreover, the currency swap deal was not acceptable to individual business owners, adding, “If you talk to a Chinese businessman, he will tell you to bring dollars. “It may work for government but not individual businessmen; they will tell you that government cannot force them to accept a currency.”