The recent data on capital importation released by the National Bureau of Statistics (NBS), shows that Nigeria’s total capital inflow declined by 17.5 per cent year on year to $1.57 billion in the first quarter of 2022 from $1.91 billion in the corresponding quarter of last year.
The decline, according to operators was a result of the growing wariness of investors around the electioneering activities across the country as well as the unabating pressure on the local currency in the foreign exchange market.
Also, the total inflow also went down by 28.09 per cent on a quarter-on-quarter basis to $1.57 billion from $2.19 billion in the preceding quarter.
Meanwhile, an analysis of the report from the NBS indicated that the largest inflow was received through portfolio investment which printed at $957.58 million during the period and was followed by Other investments which accounted for a 29.28 per cent quarter on quarter decline or 17.46 per cent year on year to $460.59 million.
Nevertheless, inflows through the bonds market rose through the quarter by 575.4 per cent to $310.06 million drove the inflow through portfolio investment resulting from the expectations of yield rise in the Eurobonds market and the expected float of the $1.25 billion Eurobonds by the federal government during the quarter, while the inflows through equities dragged the capital inflow during the quarter to $31.78 million but on the other hand outperformed first quarter data on a year on year performance by 18.24 per cent .
Further analysis on the sectoral basis showed that, inflow into the banking sector was the largest during the quarter standing at $818.84 million and indicating 52.05 per cent of the total capital which is spurred by the efforts of the CBN to make deposit money banks (DMBs) official channel for the remittances of foreign capital into the country which is buoyed by the strength and resilience of the sector.
This was followed by capital imported into the production sector, valued at $223.67 million and accounts for 14.22 per cent, while the financing sector reported $199.37 million, representing 12.67 per cent.
