National Bureau of Statistics (NBS) has released latest capital importation report shows Nigeria’s foreign direct investment (FDI) declined by 48.7 percent in Q1 of 2015 in relation to the preceding quarter (Q4) 2014.
The NBS report states that FDI showed the lowest year-on-year decline in inflows, at $96.09 million growing at -14.77 percent, while on quarter on quarter basis, the decline was larger at $374.25 million or -48.68 percent.
The bureau attributed the decline in the capital imported in Q1 2015 to high levels of uncertainty in the quarter due to a postponed election and depressed oil price.
“Capital importation is divided into three main investment types: Foreign Direct Investment (FDI), Portfolio Investment and Other Investments, each comprising various subsectors,” the report said.
According to the Wall Street Journal (WSJ) frontiers and Frontier Strategy Group (FSG) frontier market sentiment index, Nigeria maintained its top spot as the frontier-market economy that is attracting the most attention from American and European multinationals for potential future investments.
The country has held the top spot since the index was launched in June 2014 despite having endured a rough ride for the past few months.
According to the report, decline in portfolio investment inflows were primarily driven by declines in equity capital, which were lower by $1,120.98 million or 49.59 percent year- on- year, and by $402.69 million or 26.11 percent relative to Q4 of 2014.
Also, the report states that the main driver of the overall drop in capital inflows since Q4 of 2014 was from other investments which declined from a value of $1,727.78 million in Q4 to $416.34 million in the opening quarter of 2015. This shows a decline of $1,311.44 million or 75.9 percent.
This sharp decline was caused by the other claims component of other investments, in which inflows were lower by $1,304.40 million or 97.64 percent on every quarter.
