Nigerian FDI Shots up, Loans Increase Total Capital Importation in Q4 2021

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CEM REPORT | The report from the Nigerian Bureau of Statistics has shown that the Q4 2021 Foreign Direct Investment into Nigeria increased by 232.28 percent to US$107.81 million in Q4 2021 from US$107.81 million recorded in Q3 2021. The Q4 2021 FDI is a y-on-y growth of 44.74% from Q4 2020 figure of US$160.27.

Level of Foreign Direct Investment is a representation of the confidence that investors outside the shores of a country has in the economic prospects of a country. Nigeria stands third in Africa after Egypt and South Africa with highest FDI.

FDI to Nigeria crashed to US$77.97 million in Q2 2021 after the initial first quarter growth of USD154.76 million.

However, the Q4 2021 growth in FDI represent only 16.38% of the total Capital Importation for the fourth quarter being dominated by other investment (Trade cred, loans, currency deposits and other claims) and portfolio investment.

The Capital Importation report from NBS shows that the total value of capital importation into Nigeria in the fourth quarter of 2021 stood at $2,187.63 million from $1,731.37 million in the preceding quarter showing an increase of 26.35%. When compared to the corresponding quarter of 2020, capital importation increased by 109.28% from $1,045.32 million.

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The largest amount of capital importation by type was received through other investment, which accounted for 54.24% ($1.186 billion). This was followed by Portfolio Investment with 29.39% ($642.87 million) and Foreign Direct Investment (FDI) amounted to 16.38% ($358.23 million) of total capital imported in Q4 2021.

Two exceptional figures recorded in the report is the performance of the Tanning sector and the volume of investment from an African country, Mauritius

The report shows that by Sectors, capital importation into tanning had the highest inflow of $645.59 million amounting to 29.51% of total capital imported in the fourth quarter of 2021. As a matter of fact, Tanning sector had no single foreign investment in the first three quarters of 2021. According to NBS reports, Tanning sector received $0.52 million in Q4 2017 and $0.48 million in Q1 2029 as the only foreign investment since 2013

The tanning sector was followed by capital imported into the Production sector, valued at $360.06 million (16.46%) and the Electricals sector with $325.55 million (14.88%)

Capital Importation by country of origin reveals that Mauritius ranked top as source of capital imported into Nigeria in the fourth quarter of 2021 with a value of $611.45 million, accounting for 27.95%. This was followed by the United States of America and the Republic of South Africa valued at $321.03 million (14.67%) and $285.83 million (13.07%) respectively.

By Destination of Investment, Lagos state remained the top destination in Q4 2021 with $1,983.41 million accounting for 90.66% of total capital investment in Nigeria. This was followed by investment into Abuja (FCT), valued at $170.55 million (7.80%). Categorization of total capital investment by Bank shows that EcoBank Plc ranked highest in Q4 2021 with $708.58 million (32.39%). This was followed by Stanbic IBTC Bank with $453.82 million (20.74%) and Union Bank of Nigeria Plc with 284.60 (13.01%)

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