In the wake of a report by the National Bureau of Statistics that said Nigeria is in a recession there has been a dark outlook over the state of Nigeria’s economy.
There has been some good news though as the devaluation of the Naira has seen Nigeria’s trade deficit narrowed in the second quarter as the value of exports surged.
According to a report from the NBS, the trade deficit narrowed by 44 percent to 196.5 billion naira ($622 million) in the three months through June compared with 351.3 billion naira in the previous three-month period.
Exports increased 63 percent to 1.9 trillion naira in the quarter. The report said, “The improvement in export value is largely due to the depreciation in the value of the naira,” the statistics agency said. The total value of trade in the West African country increased to 3.94 trillion naira in the second quarter from 2.7 trillion naira,”
According to Bloomberg, Opeyemi Oguntade, analyst at Lagos-based Financial Derivatives Co. who spoke to them said, “Whenever there is a devaluation of the currency it encourages exporters because they get more naira for the goods sold at the international market or priced in dollar,
“For the country and the exporter, the thing to consider is if the benefit of the devaluation is high enough to outweigh the cost of rising inflation.”