A significant portion of capital importation into Nigeria in 2023, totaling $2.31 billion, was in the form of foreign loans, accounting for 59.1% of the total, as revealed by the latest capital importation report from the National Bureau of Statistics.
The report indicated a steady increase in foreign capital inflow, rising from $654.65 million in the third quarter of 2023 to $1.09 billion in the final quarter of the year.
While Nigeria recorded a total foreign investment of $3.91 billion in 2023, broken down figures show $433.87 million in Q1, $771.53 million in Q2, $507.71 million in Q3, and $594.75 million in Q4, which mirrored the foreign loans borrowed in 2022.
Analysis revealed that the value of foreign loans received in Q3 2023 was 18% lower than the same quarter the previous year, and 34.19% lower than in Q2 2023. This decline was attributed to the government’s preference for domestic borrowing.
Other components of capital importation included $627.4 million from other equity, $474.1 million from bonds, $428.9 million from money market instruments, $65.9 million from other claims, $1.91 million through currency deposits, and $51,000 from other capitals.
In Q4 2023, the total capital importation slightly exceeded the amount from the same period in 2022, showing a modest year-on-year increase of 2.62%.
The report detailed that “Other Investment” was the dominant category in Q4 2023, accounting for 54.64% or $594.74 million of total capital inflows. Portfolio investment followed with 28.46% or $309.76 million, and foreign direct investment contributed 16.90% or $183.97 million.
The production/manufacturing sector led in capital importation by sector, with $450.11 million, representing 41.35% of the total inflow. The banking sector followed with $283.30 million (26.03%), and the financing sector with $135.59 million (12.46%).
Investments from the United Kingdom led the capital inflows, contributing $267.24 million (24.55% of the total), followed by Mauritius with $226.18 million (20.78%), and the Netherlands with $149.93 million (13.77%).
The Federal Government recently announced investment commitments of $30 billion from foreign investors since assuming office eight months ago, attributing the increase to initiatives such as fuel subsidy removal and foreign exchange unification, which have attracted investments and spurred economic growth, job creation, and access to capital.
