Nigeria’s total foreign investment inflows fell 54.34 percent to $710.97 million in the first quarter of 2016, the lowest level since 2007, according to the National Bureau of Statistics (NBS).
NBS which released the capital importation report for the quarter said that the economy attracted a total investment of $710.97m (N140.07bn).
Nigeria has gone almost full circle from a favoured investor destination in Africa — because of its status as the continent’s largest crude producer and most populous nation to being spurned.
Companies drawn to Nigeria by the prospect of a population bigger than Germany and Turkey’s combined are retreating; those staying are contending with corporate tribulations and general economic hardship.
NBC said that its recently released report that the quarterly and year-on-year declines were also the lowest recorded since the series began in 2007.
The report said, “The total value of capital imported into Nigeria in the first quarter of 2016 was $710.97m, the lowest level since the series began in 2007.
“This represents a decline of 54.34 per cent in the final quarter of 2015, and a year-on-year decline of 73.79 per cent.
“Both the quarterly and year-on-year declines were also the lowest recorded since the series began.
“As a result of these changes, total capital importation has fallen by 89.13 per cent since its peak level in the third quarter of 2014.”
The report attributed the huge decline in capital importation in the first quarter of 2016 to what it described as “symptomatic of the challenging period that the Nigerian economy is going through following the fall in crude oil prices.”
It said, “Investors may be concerned about whether or not they will be able to repatriate the earnings from their investments, given the current controls on the exchange rate. In addition, as growth has slowed in recent quarters, there may be concerns about the profitability of such investments.”
In terms of the composition of the investment inflows, the report said the largest component of capital importation in the first quarter was Portfolio investment.
This, the report also said accounted for $271.03m, or 38.12 per cent of all capital imported.
The largest subcomponent of portfolio investment was Equity, which accounted for $201.69m, representing 74.41 per cent of portfolio investment and 28.37 per cent of total capital imported.
Equity, it noted, has been the largest part of portfolio investment in every quarter since 2007.