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Nigeria capital imports plunge 72% in 4th quarter as economy contracts

Published 05/02/2021, 17:31
Updated 05/02/2021, 17:42
© Reuters.

By Alexis Akwagyiram
LAGOS, Feb 5 (Reuters) - Nigeria's capital imports plunged
71.8% in the fourth quarter year-on-year to $1.069 billion, the
statistics office said on Friday, as Africa's largest economy
slipped into its second recession in five years.
Nigeria, Africa's top oil exporter, has suffered its worst
crisis in 40 years as low oil prices triggered by the
coronavirus pandemic caused the economy to contract last year,
slashing government revenues and weakening the naira currency.
Markets are awaiting fourth-quarter Gross Domestic Product
data due out this month, watching for signs of recovery. The
government plans to rebase its GDP to determine the current
structure of its economy. Nigeria has seen an exodus of foreign money, though
investors have been caught up by a shortage of dollars on the
currency market as oil prices collapsed.
Portfolio investment accounted for the lowest amount of
inflow received in the fourth quarter, the National Bureau of
Statistics said in a report.
Nigeria's capital imports fell from a peak of $21.32 billion
eight years ago to $5.12 billion in 2016 when investment dried
up following a recession. Growth had barely resumed before
second recession hit the economy.
Dollar shortages has caused the naira to weaken as the
central bank seeks ways to attract inflows through remittances,
export proceeds and offering higher treasury yields.

(Writing by Chijioke Ohuocha; Editing by Richard Chang)

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