CBN Says Foreign Investors Moved $5 Billion Out of Nigerian Economy in 6 Months
- The Central Bank of Nigeria has revealed that foreign investors and companies moved out $5.13 billion from the Nigerian economy
- The repatriations were mainly in the form of dividend payments to non-resident investors
- The CBN report also said some of the payments were used for external debt servicing
According to the Central Bank of Nigeria (CBN), foreign companies and investors repatriated about $5 billion from the Nigerian economy in six months.
Reports say the investors repatriated about $5.13 billion as dividends between October 2022 and March 2023.
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Most repatriations were dividend payments
The apex bank disclosed in its Economic Report for the first quarter that the higher dividend payments to non-residents also increased the deficit in its primary income account.
It said the deficit grew to $2.69 billion in the first quarter of 2023 compared to $2.26 billion in the fourth quarter of 2022.
CBN said the primary income account covers employee compensation and investment income.
The bank said the income may be profits, interests, dividends, and royalties received on existing foreign financial assets and liabilities.
Per the CBN report, dividend payments to foreign investors accounted for $5.13 billion in the period under review.
Investment income decreases in six months
The CBN report states that the primary income account increased by 18.7% in Q1 of 2023 due to the 34.9% growth in investment income payments, amounting to $3.09 billion from $2.77 billion in Q4 of 2022.
Punch reports that investments from dividends increased by 12.1% to $2.71 billion, comparable to $2.42 billion in Q4 of 2022.
CBN said:
"The compensation of employees' account maintained a surplus position, increasing by 6.2 per cent to $0.06bn, relative to the level in 2022Q4."
The banking regulator stated that the outflow from the account was undermining the productivity of the real sector as Forex resources were used for external debt servicing.
Per the report, the net deficit in the income account has fallen in recent years due to lower outpayments of dividends, shared branch profit, and other interest payments.
In its audited report, the CBN said it generated a profit of N103.85 billion, the highest in seven years.
Legit.ng reported that this represents a 38.24% increase in profit compared to the N75.12 billion recorded the previous year.
Foreign investors run away from 28 states as Lagos leads with highest investment in 3 months
Legit.ng reports that according to new Foreign Direct Investment (FDI) data released by the National Bureau of Statistics, 28 states could not attract Foreign Direct Investment in the quarter of 2023.
Of the 36 states in Nigeria and FCT, only Lagos, Abuja, Adamawa, Akwa Ibom, Ekiti, Ogun, Ondo, and Niger states saw capital inflows during the period under review.
The capital inflows totalled $1.13 billion. Lagos attracted $704 million in investment under review, followed by Abuja with $410 million, and Akwa Ibom at $5.21 million.
Source: Legit.ng
