Central Bank of Nigeria, CBN, Tuesday, said that rising import bills and decline in exports prompted Nigeria's foreign trade to fall by over 50 percent in the second quarter of the year.
This is even as Federal Government overspent by N132.94 billion in August, despite increase in revenue over the budgeted estimate.
Similarly, aggregate foreign investment inflows into the country fell by 37.79 percent to $3.44 billion during the quarter.
In its Economic report for August, released yesterday, CBN said: "Gross federally-collected revenue in August 2012 was estimated at N1,021.10 billion, showing an increase of 26.4 and 3.6 percent above the monthly budget estimate and the preceding month's level, respectively.
"At N749.11 billion, gross oil receipts exceeded both the monthly budget estimate and the preceding month's level by 35.5 and 18.4, respectively.
"This was attributed largely to the favourable crude oil prices at the international oil market. Non-oil receipts, at N271.99 billion (26.6 percent of the gross federally-collected revenue), was 23.0 and 6.8 percent lower than the receipts in the preceding month and the monthly budget estimates, respectively.
"The decline in non-oil revenue relative to the preceding month, reflected, largely, the fall in corporate tax, customs and excise duties, educational tax, customs/excise duties and the independent revenue of the Federal Government.
"Federal Government estimated retained revenue in August 2012 was N243.21 billion, while total estimated expenditure was N376.15 billion.
"Thus, the fiscal operations of the Federal Government resulted in an estimated deficit of N132.94 billion, as against the estimated monthly budget deficit of N94.68 billion."
Int'l economic relations
In a report on the performance of the external sector of the economy in the second quarter, CBN said the country suffered a general decline in economic relationship with other countries due to rising import bills, decline in exports and security concerns.
The apex bank's report said: "Major challenges to the sector included surging import bills due to low manufacturing output, lingering infrastructural and security problems, slow global recovery and dampened world demand for commodities as well as the dismal performance of the non-oil exports sub-sector.
"Policy should, therefore, focus on the diversification of the export base, tackling vigorously the infrastructural deficiency and the security challenges.
"The estimated current account balance at US$3.11 billion or 4.87 percent of gross domestic product, GDP, dropped by 50.33 and 42.5 percent, respectively, when compared with the position in the preceding quarter and corresponding quarter of 2011.
"This was attributed largely to the higher import bills and increased out-payments in respect of dividend and distributed branch profits paid to foreign investors.
"In addition, the slow growth in Nigeria's major trading partners such as the USA, the UK and China dampened aggregate global demand, thereby affecting Nigeria's export receipts.
"The estimated capital and financial accounts swung from a surplus position of US$1.67 billion recorded in the preceding quarter to a deficit position of US$4.45 billion in the review period. This development could be attributable to the sharp drop in both foreign direct investment, FDI, and portfolio investment inflows.
"Further analysis revealed that the country's assets abroad increased from US$2.44 billion recorded in Q1 2012 to US$7.65 billion in the review period, owing largely to the huge trade credits with respect to crude oil sales."
"On the other hand, the aggregate financial liabilities, decreased from US$4.11 billion to US$3.20 billion in the same period as a result of lower financial flows occasioned by the insecurity challenges, that affected both FDI and portfolio investments."