By Emmanuel Elebeke
ABUJA: Nigeria spent a total of $710.97 million in capital importation in the first quarter of 2016.
The National Bureau of Statistics, NBS in its latest release on Nigerian Capital Importation report for Q1 2016, showed that the amount in spent in the quarter under review was the lowest level since the series began in 2007.
This according to the bureau represents a decline of 54.34 per cent since the final quarter of 2015, and a year on year decline of 73.79 per cent.
The report further showed that both the quarterly and year on year declines in the period in view were also the lowest recorded since the series began.
As a result of these changes, total capital importation declined by 89.13 per cent since its peak level in the third quarter of 2014.
The scale of the decline in capital importation in the first quarter of 2016 is said to be symptomatic of the challenging period that the Nigerian economy is going through, following the fall in crude oil prices.
Although, the report indicated a number of reasons why the amount of capital imported in recent years may have been higher than usual (such as the inclusion of Nigerian in the JP Morgan Bond Index, and globally low interest rates triggering a search for higher yields over this period), NBS reasoned the fact that the amount of capital import has dropped to a record low suggests that there are further reasons why Nigeria has attracted less foreign investment in recent quarters.
The bureau is of the view that 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, adding that there may be concerns about the profitability of such investments.
According to NBS, the first quarter of 2016 also saw a large change in the composition of capital imported.