All the economic crises that Nigeria faces now – naira devaluation, foreign reserve decline and extreme dollar shortage – are tied together.
Foreign trade which ranges from manufactured, raw and agricultural goods to oil products have been known to support the country’s GDP by up to 33.0%. However, in 2020 foreign trade has slowed down following these crises.
Import and export data for Q1 2020 show some drastic numbers with a 12.6 per cent increase in import and 33.5 per cent decline in export. Having compared it with Q1 2019.
As the CBN tries to conserve dollars to sustain the naira this reflects back on traders. The wide range of foreign products found in the Nigerian markets are from the U.S, China, Netherlands, U.K, South Africa and U.A.E. Importers and suppliers into Nigeria need dollar in large amounts but most of them are on now hold following the shortage.
Importers now have to compromise and either wait for when traders have access to dollars. More so, they are also selling to those who are able to buy dollars at the expensive black market rate. But those are also very few now.
This has resulted in failed businesses as a business owner now adapt emergency trading strategies to survive the shortage. Unfortunately, some people have also gone out of business.
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