Central Bank of Nigeria (CBN) has issued a circular clarifying its rules on foreign investment repatriation and divestment.
Gatekeepers News reports that the directive requires foreign investors to provide evidence of transaction certificates and redemption of investments in local currency assets when divesting or repatriating their investments.
According to the CBN, “every divestment or repatriation of foreign investment… should present the following documents: a) Evidence of electronic Certificate of Capital Importation. b) Evidence of redemption of investment in local currency assets (money market instrument, debt securities, equities, etc.).”
This move comes as foreign investors have been liquidating more portfolio investments in the Nigerian capital market than they have been purchasing, with N311.41 billion worth of investments liquidated in the first half of 2024.
The CBN has also recently placed limits on the transfer of crude export proceeds by international oil companies (IOCs) to offshore accounts, citing the impact on domestic foreign exchange market liquidity.
However, on May 6, the CBN allowed IOCs to repatriate 50% of their export proceeds immediately or when required, while the remaining 50% can be used to settle financial obligations in Nigeria.
