Capital importation falls 51.51% t0 $1.06 billion in Q4 2022, as Lagos accounts for 56.62%

Key highlights

• Capital importation was US$5.328.88 billion in 2022, a decrease of 20.47% from US$6,700.51 million in 2021
• The largest capital importation during the period was received from Other Investment, which accounted for 65.17% (US$691.23 million) of total capital imported in Q4 2022.
• Lagos State remained the top destination in Q4 2022 with US$600.54 million, accounting for 56.62% of total capital investment in Nigeria.

Nigeria attracted a sum of US$1.060.73 as capital importation in Q4 2022,  a sum lower than US$2.187.63 billion recorded in Q4 2021, indicating a decrease of 51.51%.

This was disclosed by the National Bureau of Statistics on Tuesday in its  Nigeria Capital Importation Q4 2022 report.

Capital importation is one of the major areas by which the Nigerian economy accesses foreign exchange, which is currently in high demand in the country, especially at a time when oil export earnings have been dwindling.

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Portfolio

The report stated that when compared to the preceding quarter, capital importation also fell by 8.53% from US$1.159.67 billion in Q3 2022, they added:

• “The largest capital importation during the period was received from Other Investment, which accounted for 65.17% (US$691.23 million) of total capital imported in Q4 2022.
• “This was followed by Portfolio Investment with 26.89% (US$285.26 million) and Foreign Direct Investment (FDI) with 7.94% (US$84.23 million).
• “Disaggregated by Sectors, capital importation into the production sector recorded the highest inflow of US$392.54 million, representing 37.01% of total capital imported in Q4 2022. This was followed by capital imported into the banking sector, valued at US$255.45 million (24.08%), and Telecoms with US$168.27 million (15.86%).

Origin and Destination

The report noted that by Country of Origin reveals capital from the United Kingdom ranked top in Q4 2022 with US$455.24 million, accounting for 42.92%, they added:

• “This was followed by the Republic of South Africa and the United Arab Emirates valued at US$119.31 million (11.25%) and US$116.82 million (11.01%) respectively.
• “By Destination of Investment, Lagos state remained the top destination in Q4 2022 with US$600.54 million, accounting for 56.62% of total capital investment in Nigeria.
• “This was followed by Abuja (FCT), valued at US$424.50 million (40.02%).

They added that Categorization of Capital Importation by Banks shows that Citibank Nigeria Limited ranked top in Q4 2022 with US$308.72 million (29.10%), followed by Standard Chartered Bank Nigeria Limited with US$232.45 million (21.91%) and Rand Merchant Bank with US$102.00 (9.62%).

“On an annual basis, capital importation was US$5.328.88 million in 2022, a decrease of 20.47% from US$6,700.51 million in 2021,” they said.

Backstory

Nigeria attracted a sum of $4.89 billion as capital importation between January and November 2022, representing a 12.3% decline when compared to $5.89 billion recorded in the corresponding period of 2021.

Capital inflows in Nigeria fell sharply in 2020 to $9.68 billion from $23.71 billion in 2019. The numbers dwindled further in 2021, attracting only $6.7 billion, its lowest in 5 years. 2022 numbers appear set to fall further.

During the eleven months under review, $1.97 billion came into the country in form of loans, accounting for 40.2% of the total capital inflows in the review period, compared to the corresponding period of 2021, loan inflow increased by 26.8% from $1.55 billion.

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