Nigeria’s capital imports crash by 74% in first quarter

The total value of capital imported into Nigeria in the first quarter plunged to $710.97 million, a 73.79 per cent decline from the same quarter a year ago, the National Bureau of Statistics said on Wednesday.

Nigeria, Africa’s biggest oil exporter, has been hit by its worst economic crisis in years, as low prices for crude cause government revenues to plummet. Last year, the central bank imposed currency controls to prevent a collapse of the currency, the naira.

Nigeria has seen an exodus of foreign money in the last few months. In September, JP Morgan announced it would eject the country from its influential emerging markets bond index because of the currency controls. Barclays followed suit soon after.

“Investors may be concerned about whether or not they will be able to repatriate the earnings from their investments, given the current controls on the exchange rate,” the statistics office said.

“In addition, as growth has slowed in recent quarters, there may be concerns about the profitability of such investments.”

A foreign exchange shortage has seen the naira drop to record lows on the parallel market in recent months. But the central bank has resisted calls from the International Monetary Fund to ease the restrictions, a stance supported by President Muhammadu Buhari.

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