The Federal Capital Territory, Abuja has become the leading recipient of foreign capital inflows, commencing from the fourth quarter (Q4) of 2017.
In the first quarter (Q1) 2018, the nation’s capital also overtook with an inflow of $3.54 billion, the National Bureau of Statistics (NBS), has revealed in its ‘Capital Importation (Q1)’ report, which has just been released.
This indicates an increase of 32.24 per cent from the figure recorded in the previous quarter, when it reported $2.68 billion.
At the same time, capital importation to Lagos increased marginally by 4.59 per cent from $2.55 billion in the last quarter to $2.67 billion in Q1, 2018, while Capital Importation to Akwa Ibom was $43.62 million, which is a decline of 65.05 per cent from the figure reported last quarter ($124.85 million).
In contrast, Ogun, Bauchi, and Kano States witnessed strong growth in foreign capital inflow in the first quarter, each recording respective growth rates of 182.06 per cent, 370.59 per cent, and 154.84 per cent on a quarter-on-quarter basis.
The NBS also revealed in its just-released ‘Nigerian Capital Importation (Q1 2018)’ report that the total value of capital imported into the country in the first three months (first quarter) of 2018 stood at $6,303.63 million, representing a 594 per cent increase (year- on–year) from $908.3 million in Q1 2017.
According to the agency, the first quarter in 2018 saw a continuous growth in total capital importation into the country, the fourth consecutive quarterly increase since the second quarter (Q2) 2017.
A breakdown of the Nigerian capital importation by country of origin showed that the United Kingdom (UK) kept its leading role in capital investment in Nigeria in the first quarter of 2018, with $2.25 billion capital invested in the country.
This inflow accounted for 35.73 per cent of the total of capital inflow in Q1,2018, it was also a 39.89 per cent increase from the previous quarter and a growth of 644.55 per cent over the corresponding period of last year.
As well as the existence of a historical relationship between the UK and Nigeria, London (its capital) is also a principal financial centre, which explains the high value of foreign capital from the UK.
Since 2010, the UK has accounted for the highest value of capital importation in all but two quarters (both in the second half of 2015).
Similarly, the second most significant value of capital importation came from the United States, accounting for $1.26 billion in the first quarter of 2018 or 19.99 per cent of the total quarterly capital importation.
The US has also been one of the most important investors in Nigeria, usually either the largest or second largest investor country. The next two largest investors in the first quarter of 2018 were South Africa and Ghana, which recorded $493.22 million and $380.14 million capital inflow into Nigeria in the first quarter respectively.
These two countries’ capital investment accounted for 7.82 per cent and 6.03 per cent of the total quarterly capital importation in Q1 2018.
Capital Importation from South Africa increased by 79.29 per cent from the previous quarter and by 673.19 per cent relative to the first quarter in 2017.
The first quarter in 2018 was the first time since 2013 that Ghana made a significant capital investment in Nigeria, which made Ghana the fourth largest Capital Importation source country for Nigeria in the first quarter of 2018.
According to the NBS, the increase in capital inflow in Q1, 2018 was driven mainly by Portfolio Investment, which grew from $3,477.53 million in the previous quarter to $4,565.09 million, accounting for 72.42 per cent of the total capital importation during the quarter.
Capital importation is divided into three main investment types: foreign direct investment (FDI), portfolio investment and Other investments, each comprising various sub-categories. Since 2017 Q2, portfolio investment has been expanding faster than the other two categories
Abuja Overtakes Lagos In Foreign Capital Inflows
Saturday, 12 May 2018