The National Bureau of Statistics (NBS) will tomorrow Tuesday publish the capital importation report for the first quarter of 2020.
Yemi Kale, Statistician-General announced this in his official Twitter account on Monday. Ayodeji Ebo, managing director, Afrinvest Securities Limited expects to expect a drastic reduction in Capital Importation in Q1, 2020 due to the COVID-19 pandemic which affected global markets as the country experienced more capital outflows from emerging markets within this period. Also, Foreign Direct Investments (FDI), which has continued to shrink will also fall significantly due to the uncertainties across the globe.
He said as economies reopen globally, Nigeria needs to be more deliberate in its fiscal policy to attract FDIs to grow the economy. Also, on Foreign Portfolio Investments (FPIs), the Central Bank of Nigeria (CBN) needs to act quickly in providing direction on the FX. “It’s obviously another adjustment is necessary to keep the FX market liquid and provide confidence for FPIs,” Ebo said.
The total value of capital importation into Nigeria stood at $3802.38 million in the fourth quarter of 2019, according to NBS. Against the first quarter of 2019, the total value of capital importation into Nigeria stood at $8,485 million.
READ ALSO: CBN’s AGSMEIS loan disbursement: North-Central gets N18.29bn
The capital importation report is coming a day after the NBS published the first-quarter GDP report.
Uche Uwaleke, professor of finance and capital markets, chair, banking and finance department, Nasarawa State University Keffi, Nasarawa State, said, against the backdrop of the negative impact of COVID’19 on the economy, the supply chain disruptions, the associated public health crisis and the collapse in oil price, the drop in the country’s real GDP growth rate from 2.55% in the 4th quarter of 2019 to 1.87 percent in the following quarter, that is Q1 of 2020, should not come as a surprise to anyone.
He said the drop in real GDP growth rate would have been more severe but for the moderating impact of the relatively greater tempo of economic activities in the month of January. It is instructive to note that while the non-oil sector with over 90% contribution to GDP managed to eke out a growth rate of 1.55%, the oil sector grew by 5.06%. By extension, the growth in Q1 2020 was powered by the oil sector that contributed just 9.5% of GDP. This has implications for economic planning going forward.
Uwaleke said the oil sector’s real GDP growth rate will be negatively impacted in 2020. This is the more reason much attention should be shifted to the Non-oil sector especially Agriculture, health, Education and the enabling infrastructure such as power, roads and ICT.
