Nigeria Forex Inflow Declined By $72 Billion.

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According to data obtained from the CBN’s economic report for the fourth quarter (Q4) of 2022 which was released on its website recently, stating that the country’s net total foreign exchange (FX) inflow closed at $72.4 billion in 2022.

The figure marked a 23.3 per cent decline compared to the $94.3 billion recorded in 2021 and also a 37.4 per cent decline compared to $115.6 billion received in 2020.

A breakdown of the data showed that $29.89 billion came into the country through the CBN, while $42.49 billion came in through autonomous sources. Conversely, a total of $40.99 billion was recorded as outflow in the same period, slightly lower than the $41.62 billion recorded in the previous year. This indicates a net surplus of $31.39 billion in the review year.

Nigeria has since been witnessing consistent decline in dollar inflows into the economy, on the back of shrinking foreign direct and portfolio investments.

This also confirms the National Bureau of Statistics (NBS), data that showed that capital importation declined by 20.5 per cent to $5.33 billion in 2022.

A further breakdown showed that foreign direct investment (FDI) in Nigeria dropped by 33 per cent to $468.1 million compared to $698.87 million recorded in the previous year. Similarly, the country’s foreign portfolio investment data showed a decline of 27.9 per cent to $2.44 billion in the year under review. The CBN data revealed that a total of $15.27 billion was supplied by the apex bank to the economy, all of which came from the I&E window, SME and Invisibles.

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Experts noted that in 2022, the apex bank made no sale of dollars to BDCs, compared to $2.77 billion and $5.33 billion recorded in 2021 and 2020 respectively.

“The decline in FX inflows has also affected the nation’s external reserves as the apex bank continues to defend the Naira and fund import bills at the expense of its reserve level. Nigeria’s external reserves declined by $3.44 billion in 2022 to close at $37.1 billion. Furthermore, its reserves level has dropped to $35.22 billion as of 10th May 2023”, they said.