The increase in foreign portfolio investments in Nigeria, despite the uncertainties of an election season, is a manifestation of investor’s confidence in the Nigerian economy.
According to the Buhari Media Organisation (BMO) in a statement signed by its Chairman Niyi Akinsiju and Secretary Cassidy Madueke, from January 2019 to February 2019, Nigeria’s foreign portfolio investment recorded an unprecedented $6 billion dollars inflow, boosting the foreign reserves to sustain a five-month high currently at $43.547 billion dollars.
“This is quite satisfying, because with the sustained increase in the rise of Foreign Reserves, increased investors confidence in our economy, the Buhari administration has set a new precedence for fiscal and monetary discipline.
“We note also that, unlike the average five (5) months service capacity of Nigeria’s foreign reserves, the current volume has the capacity to service sixteen (16) months stretch of Forex demand, in a worst-case scenario.
“Although the major driver for the stability in foreign exchange market is the price of crude oil, the dramatic increase in the buy-out of Nigeria’s treasury bills and bonds have no doubt helped in boosting the reserves,” the group said.
BMO also noted that President Muhammadu Buhari’s administration remains committed to increasing foreign reserves because the National Economic Council understands that creating the best case scenario for the Naira to appreciate further against the dollars requires a careful, clinical approach to diversifying the inflow of foreign exchange revenue.
The pro-Buhari group also noted that the confidence in Nigeria’s economy is further underscored by a recent letter from the European Union which noted that; “President Buhari’s commitments to an inclusive government offers an opportunity to take Nigeria forward in a way that meets the objectives of strengthening the economy, fighting corruption and improving security… what happens in Nigeria matters to the rest of the world including to Europe.”
