Capital import doubles to $4.15bn in Q3 – NBS
The capital importation into Nigeria in the third quarter of this year recorded a substantial increase compared to the past few quarters, as the economy continued to recover from recession.
The capital importation data released by the National Bureau of Statistics (NBS) showed that the total capital imported in the third quarter of 2017 was recorded at $4.15 billion, more than double the inflow in the second quarter of the year, representing an increased value of 147.5 per cent on a year on year basis.
This inflow of capital in the third quarter of 2017 is the first time since the beginning of 2015 that capital hit over $4 billion in a quarter.
The NBS attributed the boom in capital importation in third quarter of 2017 to “significant growth in both portfolio investment and other investment.”
Capital importation can be divided into three main investment types: Foreign Direct Investment (FDI), Portfolio Investment and Other Investments, each comprising various sub-categories.
Portfolio Investment, which was recorded at $2.77 billion in the third quarter of 2017, remained the largest component of capital import and contributed to 67 per cent of the total amount.
This component expanded faster than the other two main categories with a year on year growth rate of 200.7 per cent.
Analysis showed that Foreign Domestic Investment recorded $117.6 million which fell by 65.5 per cent year on year while Other Investment increased by 124.55 per cent compared to 2016 Q3.
Although Other Investment in 2017 Q3 more than doubled the value in the third quarter of 2016 from $516.2 million to $1.26 billion, it remained about 30 per cent of the total capital importation.
Capital is either imported in the form of shares, or directly imported by different sectors of the economy.
The data showed that share capital investment, which is closely related to Equity investment (FDI and Portfolio), was largely responsible for huge increase in capital importation during the quarter.
The percentage of shares kept increasing since the first quarter of 2017 and by the third quarter it accounted for 66.24 per cent of the total capital importation.
Daily Trust observed that in the third quarter of 2017, among the $4.15 billion capital investment, $2.75 billion was invested as shares and the amount of shares investment grew by 324.86 per cent year on year, largely exceeding the already impressive total capital importation growth rate of 147.5 per cent.