The Central Bank of Nigeria (CBN) has reported a sharp decline in aggregate foreign capital inflow into the country in April this year as Portfolio Investment value significantly declined during the month, when compared to accruals from the source in the preceding month.
Specifically, the apex bank , in its just published ‘April 2024 Monthly Economic Report’, disclosed that that total foreign capital inflow into Nigeria in the month covered in the report stood at $770 million, representing 57.22% decline from the $1.80 billion inflow in March this year.
It attributed the sharp decline to a reduction in investments in money market instruments, including Nigerian Treasury Bills (NTBs)
The report partly stated: “A lower foreign capital inflow was recorded in the review period, occasioned by lower investments in money market instruments. Capital inflow into the economy fell to US$0.77 billion, compared with US$1.80 billion in March.”
A further analysis of the report showed that Portfolio investment inflow largely accounted for the total foreign capital inflow, dropping to $330 million in April from $1.16 billion recorded in March as investors remained apathetic in trading in money market instruments;
In addition, the report further reflected drops in other forms of investments, particularly loans, which also fell to $430 million from $620 million inflow in the preceding month.
As expected, Foreign Direct Investment (FDI) also dipped to $10 million, down from $20 million recorded in March, sequel to a reduction in equity investments.
When analysed based on composition of foreign capital inflows in the month, Other Investments represented the largest contributor at 55.84%, followed by Portfolio investments at 42.71%, and Direct investment, with the balance of 1.45%.
An analysis of the report on sectoral contributions to the foreign capital inflow indicated that Banking sector dominated with 70.46% of the inflow, followed by Trading at 12.89%, Production/Manufacturing at 5.77%, Telecommunications, 4.94%; Shares, 4.35%; while other sectors accounted for the remaining inflows.
It would be recalled that the National Bureau of Statistics (NBS) reported that Nigeria’s total capital importation to the country in the first quarter of this year rose by 210.6% from $1.08 billion recorded in Q4 2023 to $3.37 billion.
The statistics agency disclosed that when compared to the capital importation in the corresponding quarter of 2023, the Q1 2024 inflow increased by 198.06%.
