- Nigeria’s Investment Inflows Drop by N1tn in Q3
The total investment inflow into the economy between the first and third quarter of 2018 dropped by $3.45 billion or N1.05 trillion, according to the analysis of the 14 sectors reported by the National Bureau of Statistics.
The report showed investment inflow declined from $6.3 billion in the first quarter of the year to $2.85 billion in the third quarter, representing a decline of 54.76 percent.
Also, the report stated that investment in shares was affected the most, dropping by 55.9 percent or $2.12 billion from $3.79 billion in the first quarter to $1.67 billion in the third quarter.
While the banking sector is the most affected in percentage terms, declining by 75.50 percent from the $1.18 billion to $289.4 million.
In the agriculture sector, investment dropped from $130.9 million in the first quarter to $23.3 million. Investment in other sectors like oil and gas, marketing, servicing, telecoms, and trading declined to $7.73 million, $3.43 million, $205.91 million, $11.42 million and $10.29 million, respectively.
Speaking on the decline, Mr Godwin Eohoi, the Registrar, Institute of Finance and Control of Nigeria, said poor infrastructure is the reason for the decline.
He later called for a lower interest rate to aid business operation through affordable loans.
The CBN, however, attributed the reduction to rising interest rates in developed economies and the uncertainty surrounding the forthcoming national election.
The economy grew at 1.81 percent in the third quarter but over 20 million Nigerians were unemployed during the period. Suggesting businesses are not creating new jobs as new investments are at a record-low.
Weak capital importation amid falling oil price is hurting the national foreign reserves that dropped from N47 billion recorded in May to about N43 billion in December.
Analysts believe low oil price and weak capital importation will hurt economic outlook in 2019, especially CBN forex intervention.