Another surge in portfolio capital imports

The NBS recently released its latest report on Nigerian Capital Importation, which covers Q1 2018. The data was obtained from the CBN and compiled using information on banking transactions from all registered financial institutions in Nigeria. The total value of capital imported in Q1 was estimated at US$6.3bn, representing increases of 17% q/q and 594% y/y. The increases were again driven by portfolio investment. The data are gross, and not adjusted for capital exports.


  • Portfolio investment increased by 31% q/q and accounted for the largest share (72%) of total capital importation. Investment in money market instruments (including NTBs) was the primary driver; it represented 77% of total portfolio investment. Meanwhile, equities accounted for 15% of this total.
  • Investment appetite has picked up considerably on the back of the relatively positive macroeconomic outlook, not forgetting the CBN’s fx reforms that have made fx available at its various window and auctions. Core economic indicators, notably growth, inflation and official reserves, are moving in the right direction.
  • Foreign direct investment (FDI) inflows increased by 16.7% y/y to US$246m but posted a q/q decline of -35%. FDI accounted for just 4% of total capital importation in Q1. Until definitive steps are taken to address Nigeria’s structural and infrastructural failings, FDI inflows will remain abysmal.

Sources: National Bureau of Statistics (NBS); FBNQuest Capital Research


  • Abuja saw inflows of US$3.5bn in Q1, and Lagos State US$2.7bn. This left a small residual figure for the remaining 35 states. The next largest was Akwa Ibom’s US$48m.
  • In terms of the origination of capital imports, the UK had the largest share at US$2.3bn, or 36% of the total.
  • We expect that the Q2 report, when published, will make good reading. The FDI figure is likely to be again underwhelming but the conditions for offshore investment in fixed-income and money market instruments have remained healthy.

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