Top trade articles on Stears Business

On Thursday this week, Michael, the Chief Economist at Stears, wrote an article with some scary findings. 

The highlight that everyone will remember is the destruction of our exports. Between 2010 and 2013, Nigeria’s total goods exports were valued at $109 billion. By 2019, that figure had halved. And in 2020, total exports were only worth $35 billion. 

Essentially, If you compare today to Nigeria of 2014, there is a $74 billion hole. Keep in mind that Nigeria’s entire economy is around $450 billion. And on average, exports account for 30% of Nigeria’s economy. Therefore, this $74 billion loss has suppressed our economy significantly. 

The second issue is that we have now gone from earning more than we spend in the international market to spending more than we earn. We were once an overall net exporter, but that is no longer the case. 

So, not only is the size of our economy smaller than it could have been, but we are also spending more dollars (to import) than we are making (from exports).  This explains the trouble we have seen with our exchange rate in recent times—demand is more than supply. 

And just like Michael’s article explained, the other implication of this imbalance is our rising debt profile. 

All in all, Nigeria’s international trade position is in a dire state. 

To help calm our nerves, we looked at our archives and put together our favourite trade articles. They help us explain how we got to this position and how we can potentially get out. 


1. Nigeria’s future depends on international trade 

Before you read any article about international trade, you need to digest this article first. Our Editor in Chief whipped out his notes from school to give us the fundamentals of why trade is good in the first place. In what he describes as “magic,” this article shows how Nigeria’s route to prosperity can only happen with open borders and higher non-oil exports. The secret to our export success might not even involve goods.  

Read the full article here

2. Dollar slow to enter, dollar quick to go 

This story isn’t purely about international trade. It also includes investment. However, both are very much linked. In fact, most countries, like Nigeria, have one ministry that handles both together. One thing that links trade and investment is the flow of dollars. This article is one of the most-read by Stears analysts because it is so rich with facts and figures. It shows how dollars or foreign exchange earnings are significantly dependent on what happens with our exports and imports from a trade context. 

Read the full article here


3. High hopes, higher standards: what it takes to export to foreign markets 

The Stears Business Newsroom is great. We don’t just give our audience macroeconomic information about a sector or industry, but we also go into the micro or “on ground” issues as well. This article is a good example of this. People say that Nigeria should export more, but what does it actually take to export goods to international markets? In this piece, we use food exports to Europe as a case study of the different hurdles that exporters face when sending their goods abroad. Even when foreign countries have zero tariffs or taxes, exports can still be restricted. 

Read the full article here 


4. The WTO Okonjo-Iweala might inherit 

The Newsroom doesn’t just cover stories from the lens of an entire industry; we also focus on specific companies. Or even people! This piece is about Nigeria’s very own Ngozi Okonjo-Iweala, who is now the Director-General of the World Trade Organisation (WTO). The WTO is arguably the most significant global trade institution, but what is its function?  And what does it mean for Nigeria that Okonjo-Iweala is the leader of the group? This article has got you covered. 

Read the full article here 


5. The silent success of sesame seeds in Nigeria

Gbemisola provided several people with ideas of how to blow in this article. She uncovered how the sesame seeds export industry was taking off. In the first quarter of 2017, export earnings from sesame seeds were valued at just over ₦10 billion. By the first quarter of 2020, export proceeds had risen to ₦50 billion. This was higher than our cocoa exports in that period which came in at ₦35 billion. Yet you don’t hear of sesame seeds as much as you hear about cocoa. Well, this article plugs that gap. It’s a good example of how farmers can significantly boost their incomes by selling to the world. 

Read the full article here 


6. How Ghana came to dominate yam exports

Sticking with the theme of important food. This story is about yam, one of Nigeria’s favourite meals. In fact, we produce almost 70% of yams globally. Meanwhile, Ghana can only produce 10% of all yams. Yet, Ghana contributed 94% of the total yams exported from West Africa and 22% of global exports in 2019. Nigeria is nowhere to be found. Why? We have the capacity to produce enough for domestic consumption and export, but we have failed at the latter. In this story, we highlight some of the domestic roadblocks for exporting food from Nigeria. 

Read the full article here 


7. Nigeria’s “Uber for ships” pivots, bets on international trade 

This is a great piece by our deputy editor, Adesola. She talks to the founder of Merchant Venture Xpress (MVX) and breaks down their entire business model. This is one of those pieces that urges you to do even more digging into a new area of interest. Importantly, this story masterfully highlights the problems that traders face when trying to move goods in and out of Nigeria. 

Read the full article here


8. Two things that are good about Nigeria 

International trade is not just about goods. In fact, services exports as a percentage of global GDP have doubled from 7% in the 80s to 14% in 2019. Back in 1980, services exports were worth $450 billion globally. By 2019, it was worth over $6.1 trillion. This is where the new growth in trade is coming from. And India and its IT sector is a great example of this. Fortunately for Nigeria, we have several factors similar to India that could prove useful for a boom in services exports. In this article, we have a look at two areas that are bright spots for Nigeria. Both of which can boost our services exports. 

Read the full article here

9. Cross-border payments in Nigeria: Are we there yet?

To take advantage of the services or digital economy side of international trade, we need to be able to move money and make payments online. Not just that, it needs to be fast and cheap. As this article highlights, there is still a lot of work to be done in this space. But it’s one thing that is fundamental for the growth of other Nigerian industries to perform well on the international stage.  

Read the full article here


10. Will the AfCFTA be worth it for Nigeria? 

One way that countries boost their international trade is to sign trade agreements with other countries. In Africa’s case, 55 member states have agreed to create a free trade area where goods and services should be free to move between countries with greater ease. According to the World Bank, Africa will see its income rise by 7% ($450 billion) by 2035 due to the AfCFTA. That’s equivalent to adding another South Africa and Ghana to the continent. But Nigeria hesitated to sign the agreement because opening up our borders might destroy some of our industries. So, what then? Will the AfCFTA be good or bad for us? 

Read the full article here


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