Nigerian Oil Industry Sees 94% Decline in Foreign Capital Inflow
A significant decline was recorded in foreign interests in the Nigerian oil and gas industry last year, as foreign investment inflow into the sector dipped by 93.74 per cent to $6.37 million in 2022, compared with $101.82 million recorded in 2021, according to data released by the National Bureau of Statistics (NBS).
The NBS, in its Foreign Trade Statistics for the Fourth Quarter of 2022, stated that the petroleum industry accounted for 0.12 percent of total foreign capital imported into the country in 2022, compared with 1.52 per cent of total capital imported in 2021.
According to the statistics agency, in the first and second quarter of 2022, the oil and gas sector attracted $0.61 million and $1.93 million, respectively, while in the third and fourth quarter of 2022, $1.57 million and $2.26 million were attracted into the sector, respectively.
In comparison, in the first, second, third and fourth quarter of 2021, $57.25 million, $11.32 million, $0.94 million and $32.31 million foreign capital were imported into the oil and gas sector respectively.
In general, the NBS noted that total capital inflow into the Nigerian economy in 2022 stood at $5.329 billion, dropping by 20.46 per cent, compared with foreign capital inflow of $6.7 billion recorded in 2021.
Breakdown of the total capital importation in 2022 showed that $1.573 billion, $1.535 billion, $1.159 billion and $1.061 billion were imported, respectively, in the first, second, third and fourth quarter of 2022, compared with $1.906 billion, $875.62 million, $1.731 billion and $2.188 billion foreign capital imported into the country in the first, second, third and fourth quarter of 2021.
In its analysis of inflow in the fourth quarter of 2022, the NBS said: “The total value of capital importation into Nigeria in the fourth quarter of 2021 stood at $2.187 billion from $1.731 billion in the preceding quarter showing an increase of 26.35 per cent. When compared to the corresponding quarter of 2020, capital importation increased by 109.28 per cent from $1.045 billion.
“The largest amount of capital importation by type was received through other investment, which accounted for 54.24 per cent ($1.187 billion). This was followed by Portfolio Investment with 29.39 per cent ($642.87 million) and Foreign Direct Investment (FDI) amounted to 16.38 per cent ($358.23 million) of total capital imported in fourth quarter 2021.
“Disaggregated by sectors, capital importation into tanning had the highest inflow of $645.59 million amounting to 29.51 per cent of total capital imported in the fourth quarter of 2021. This was followed by capital imported into the production sector, valued at $360.06 million (16.46%) and the Electricals sector with $325.55 million (14.88%).”
