CBN says foreign investors move $5 billion out of Nigerian economy in 6 months

According to the Central Bank of Nigeria (CBN), foreign companies and investors repatriated about $5 billion from the Nigerian economy in six months.

Reports say the investors repatriated about $5.13 billion as dividends between October 2022 and March 2023.

Most repatriations were dividend payments

The apex bank disclosed in its Economic Report for the first quarter that the higher dividend payments to non-residents also increased the deficit in its primary income account.

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It said the deficit grew to $2.69 billion in the first quarter of 2023 compared to $2.26 billion in the fourth quarter of 2022. CBN said the primary income account covers employee compensation and investment income.

The bank said the income may be profits, interests, dividends, and royalties received on existing foreign financial assets and liabilities.

Per the CBN report, dividend payments to foreign investors accounted for $5.13 billion in the period under review.

Investment income decreases in six months The CBN report states that the primary income account increased by 18.7% in Q1 of 2023 due to the 34.9% growth in investment income payments, amounting to $3.09 billion from $2.77 billion in Q4 of 2022.

Punch reports that investments from dividends increased by 12.1% to $2.71 billion, comparable to $2.42 billion in Q4 of 2022.

CBN said: "The compensation of employees' account maintained a surplus position, increasing by 6.2 per cent to $0.06bn, relative to the level in 2022Q4."

The banking regulator stated that the outflow from the account was undermining the productivity of the real sector as Forex resources were used for external debt servicing.

Per the report, the net deficit in the income account has fallen in recent years due to lower out payments of dividends, shared branch profit, and other interest payments.

In its audited report, the CBN said it generated a profit of N103.85 billion, the highest in seven years.

Legit.ng reported that this represents a 38.24% increase in profit compared to the N75.12 billion recorded the previous year.