The External Sector Development Report for the fourth quarter of 2012 released by the CBN revealed that the importation of industrial, oil, food and manufactured products utilised 28.3, 27.3, 19.2 and 18.0 percent of the total, respectively.
Further analysis of the report revealed that $3.80 billion or 37.2 percent was expended on services which comprised, financial ($2.97 billion or 78.1 per cent), business ($0.23 billion or 6.1 percent), transportation ($0.29 billion or 7.7 percent) while “others” accounted for the balance.
Foreign exchange utilisation of 19.2 percent for food importation was high and suggests the need for “adequate funding of the agricultural sector and the vigorous pursuit of the financial inclusion programme,” the CBN’s report stated.
The aggregate demand for foreign exchange by the authorised dealers consisting of the Wholesale Dutch Auction System (WDAS) and Bureau De Change (BDC) operators stood at $4.29 billion in Q4 2012, indicating a decline of 34.2 and 59.4 percent when compared with the levels recorded in the preceding quarter and corresponding quarter of 2011, respectively.
This development was traced to the increased supply of foreign exchange through the autonomous sources to the interbank foreign exchange market.
A total of $10.22 billion was utilised in Q4 2012 consisting of US$6.41 billion and US$3.80 billion for visible and invisible trade.
Further analysis showed that foreign exchange utilised for visible transactions has remained dominant over the last two quarters of 2012.