Enterprise Television- IMF: Investor Confidence Returning to Nigeria
Foreign exchange reforms introduced by the Central Bank of Nigeria (CBN) have positively impacted the economy as investor confidence has started returning to the country, the International Monetary Fund (IMF) has said.
The IMF Mission Chief to Nigeria, Mr. Amine Mati, said this at the Moody’s Investors Service 4th Annual West Africa Summit: “Nigeria’s Recovery: Slow and Sturdy,” in Lagos yesterday.
According to him, initiatives such as the Investors’ and Exporters’ (I&E) forex window have provided some confidence for investors keen on Nigeria who are now staging a comeback.
He said: “There is returning investor confidence in the country; the number of investors that keep coming to my office keeps rising. Last year, the country raised $4.8 billion including the Diaspora Bond and the Eurobond issuance. This year, the country has raised $2.5 billion from the Eurobond market”.
“Last year, foreign holdings of local debt was about $4 billion, as of the end of march, foreign holdings of local debt was $16 billion, a lot of interest. Same in the equities market, there was increase in the equities market in the first nine months of 2017,” he added.
He further pointed out that another positive development in the Nigerian economy is the stability in the exchange rate, noting that whereas in February last year, the country had an exchange rate of N520 to a dollar (parallel market) and N305 to a dollar (official market) with other windows having different rates, there was now some convergence in rates.
The IMF official stated that apart from the forex reforms, high oil prices suggest bright prospects for the Nigerian economy.
It will be recalled that the CBN established the I&E forex window on April 21 last year with the aim of boosting liquidity in the forex market and ensuring timely execution and settlement for eligible transactions.
The Apex Bank had stated that transactions under the window will be done at market determined rates and would include invisible transactions such as loan repayments, loan interest payments, dividends/income remittances, capital repatriation, management service and consultancy fees.
In April this year, CBN Governor, Mr. Godwin Emefiele, revealed that 0ver $20 billion of inflows had so far entered the country through the I&E fx window.