Nigeria received $5.36 billion capital importation (inflows) in the third quarter of 2019, compared to $5.82 billion in the second quarter. This is the lowest amount of capital importation received in the year.
According to the latest capital importation report released by the National Bureau of Statistics (NBS), $5.36 billion capital importation received in the third quarter represents a -7.78percent contraction from the total amount ($5.82 billion) received within the second quarter.
Nigeria’s capital importation is categorized into three investment types, and these include Portfolio Investment, Foreign Direct Investment (FDI) and Other Investment.
According to the report, in Q3 2019, the largest amount of capital importation by type was received through portfolio investment, which accounted for 55.88percent ($2.99 billion) of total capital importation.
This followed by other Investment, 40.39percent ($2.16 billion) of total capital, and then Foreign Direct Investment, which accounted for 3.73percent ($200.08 million ) of total inflows within the period.
The report noted that FDI is an investment in the form of a controlling ownership in a business, in one country by an entity based in another country.
In the latest report, FDI constituted only 3.73percent ($200.08 million) of total capital inflows in Q3 2019, this represents the lowest across all forms of capital inflows in the country.
The breakdown of FDI shows that investment in equity amounted to $196.38 million, while other capital stood at $3.70 million.
During the period under review, the largest amount of capital importation by type was received through portfolio investment, which accounted for 55.88percent ($2.99 billion) of total capital importation in Nigeria. Under the portfolio category, investment in money market instruments remains the largest recipient of capital inflows with a total of $2.54 billion, followed by $196.36 million in equity, while investment in bonds stood at $91.60 million.
According to the NBS report, other investment is broken down into four categories which include Trade credits, Loans, Currency deposits and other claims. However, the bureau only provided details for loans and other claims.
In the third quarter of 2019, other investments recorded the second-largest capital importation, accounting for 40.39percent ($2.16 billion) of total capital importation.
Further analysis of the capital importation shows that ten major sectors of the sixteen sectors recorded a decline in capital importation.
The sectors (nature of business) that witnessed major decline within the quarter include Shares, Agriculture, Banking, Brewing, Construction, Consultancy, Financing, Fishing, Hotels, Production, Servicing and Transport.
On the positive side, major sectors that recorded growth in capital inflows within the quarter include consultancy, electrical, marketing, oil and gas, telecoms and transport.