Banking sector, others suffer as investment inflows drop by N1tn
About 14 sectors of the economy recorded a decline of about $3.45bn (about N1.05tn) in investment inflow between the first and third quarter of the year, analysis of the capital importation report prepared by the National Bureau of Statistics has revealed.
The report, which was obtained by our correspondent from the NBS, showed that the inflow of investment into the economy declined from $6.3bn as of the end of March this year to $2.85bn.
It stated that investment in shares was the most affected dropping by $2.12bn from $3.79bn in the first quarter to $1.67bn in the third quarter.
This is followed by the banking sector which recorded a decline of $891m from $1.18bn to $289.4m.
Investment in the agriculture sector recorded a decline from $130.9m in the first quarter to $23.3m, brewing from $1m to N0.3m, electrical from $18.66m to $5.67m, and financing from $485.41m to $371.6m.
Others are marketing from $4.27m to $3.43m, oil and gas from $85.62m to $7.73m, servicing from $328.15m to $205.91m, telecoms from $87.25m to $11.42m and trading from $27.33m to $10.29m.
Speaking on the drop in investment inflow, the Registrar, Institute of Finance and Control of Nigeria, Mr Godwin Eohoi, said that the poor infrastructure in the country was encouraging capital flight.
He called for a reduction in the interest rate to enable businesses to have access to cheap funds for new investments.
He lamented that why other countries gave out loans to businesses at a single digit, banks gave out loans in Nigeria at about 25 per cent.
Apart from reducing the interest rate, he called on the government to come up with policies to attract fresh funding in employment generation sectors of the economy such as the automobile, agriculture, manufacturing and solid minerals, among others.
The Executive Secretary, Nigerian Investment Promotion Commission, Yewande Sadiku, had said that there were investment commitments of about $17.88bn that were waiting to be made in some states of the federation.
The investments, according to her, are secured in 32 projects across the states of the federation.
The NIPC boss gave some of the states that had received huge investment commitments as Lagos with $3bn; Ogun, $1.04bn; Niger, $754.7m; Gombe, $315m; and Kano, $174.6m.
The NIPC boss said that the oil and gas sector, with a total investment commitment of $12.9bn, got the highest interest from investors.
The $12.9bn is about 72 per cent of the total investment commitments. This is followed by the services sector with $4.5bn representing 25.3 per cent, manufacturing with $440m or 2.5 per cent and agriculture with $10m.
Providing the country of destination from where these investments would come from, she said investors from the United Kingdom made a commitment to invest $9bn, Nigeria, $4.21bn, while investors from the United States pledged $2.35bn.
There is also an investment commitment of $1.2bn from Chinese investors, Switzerland $847m while other countries have a combined figure of $262m.
She said, “This figure gives us a sense, but I tell you that there are investments that may not be disclosed since investors are not really under obligation to.
“We are interested in seeing more Nigerians invest in the country, and we have a Domestic Direct Investment model now in the commission and we are working with the National Bureau of Statistics to track investments inflow into the country.”