Foreign investors interested in Nigeria – Cardoso

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The Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said that Foreign Portfolio Investors want the country to carry out policy reforms to enable them to bring in their funds.

Cardoso said this on Monday during an interview on Arise TV, where he addressed concerns about the recent volatility in the currency market.

The latest report on capital importation from the National Bureau of Statistics showed that in Q3 2023, capital importation into Nigeria stood at $654.65m, lower than $1.16bn recorded in Q3 2022, indicating a decline of 43.55 per cent. In comparison to the preceding quarter, capital importation fell by 36.45 per cent from $1.030bn in Q2 2023.

While other investments ranked top, accounting for 77.56 per cent ($507.77m) of total capital importation in Q3 2023, portfolio investment was 13.31 per cent ($87.11m) and foreign direct investment brought in 9.13 per cent ($59.77m).

Speaking on the interest of FPIs, Cardoso said, “Some people look at foreign portfolio investors and say, ‘Oh, it’s hot money and all that.’ I don’t believe that is the case. I take it that in any portfolio that you have, whether it be a sovereign or a corporate, you will have a diversified mix of investors.

“Today, we have a situation where a lot of foreign portfolio investors are interested in coming back to the Nigerian market and if there is any group that has taken an interest, methodically, I say because they have not run over the door to get in, but they have taken a methodical interest in understanding the reforms that are taking place and how it is taking the country to a direction they believe is the right one, it is the foreign portfolio investors.”

The apex bank boss added that the reports of the rating agencies about Nigeria were also confirming the leanings of the FPIs.

“They come, you think they may not come back, then they come back a second time, they come back a third time and then they see some of the rating agencies coming out with their own conclusions of how they see the economy of the country progressing. It validates their thinking. We do additional reforms; it continues to encourage them.  That is how I see investors playing today.

“Gone are the days when you can shut yourself out. The thing is to have it as part of the mix of the different inflows,” he said.

He added that the recent move of the government to have Nigerian National Petroleum Corporation Limited and other ministries and departments and agencies of government’s funding also sends a signal to the foreign investors.

He said, “I think the recent move to have NNPCL and other MDAs move their funding straight to the central bank also sends a power message. It boosts the confidence that finally, Nigeria is going in a direction that many investors would love to see it go.”