Nigeria removes impediment to investment

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At the Standard Bank’s African Investors Conference, Mr Lamido Sanusi, Governor of the Central Bank of Nigeria announced that the one-year restriction associated with the holding period of the Certificate of Capital Importation (CCI) in the fixed income market was to be lifted on 1st July 2011.

The restriction, which required foreign investors to hold their Naira position for a year if they purchased government securities in Nigeria, has acted as an impediment to capital inflows as international investors were deterred from locking into a Naira denominated position for such a time frame in the post-Lehman world.

Stephen Bailey-Smith, Head of African Research at Standard Bank commented: “We see this development as a positive breakthrough that should further integrate Nigeria into the global financial system and allow foreign investors to take advantage of attractive double-digit yields especially as the country’s fixed income secondary market is relatively liquid.

“This will boost the external competitiveness of Nigerian debt instruments, compared with its emerging market and frontier market peers where FX restrictions are non-existent.”

The Standard Bank African Investors Conference held this week in London brought together African policymakers; leading institutional investors from the US, UK and EMEA, as well as senior representatives from leading African companies including Kenya Airways, Sacoil Holdings and Copperbelt Energy Corporation.

The African Investors Conferences are hosted by Standard Bank regularly throughout each year and bring together many of the bank’s clients, policymakers and investors. The purpose of these forums is to stimulate debate around the opportunities afforded by the African continent, by focusing on economic growth and the continent's entrepreneurial outlook. The African Investors Conference programme involves a combination of keynote speakers, informal roundtable meetings and breakout sessions with high profile delegates from across Africa.

Standard Bank’s next investor conference will take place in New York from 26-27th September and in Kenya towards the end of this year.