Global audit firm KPMG has warned that Nigeria’s economic stability faces a critical threat due to a significant downturn in portfolio investment. This alarming trend has dire implications for foreign exchange availability, currency devaluation, inflation, purchasing power, and economic growth.

The National Bureau of Statistics (NBS) capital importation report, analyzed by KPMG, highlights an 86.58% decline in portfolio investment from $649.28 million in Q1 2023 to a mere $87.11 million in Q3 2023. This steep drop in financial asset investments—stocks, bonds, and securities—reflects sustained negative sentiments despite initial positive reactions to reforms in Q2 2023.

The firm noted: “Portfolio investment which includes investments in financial assets such as stocks, bonds, and other securities has also been on the decline since Q1 2023 from $649.28 million to $87.11 million in Q3 2023 exposing the economy to risks of foreign exchange illiquidity and currency depreciation, pressure on consumer price inflation, reduced purchasing power, slower economic growth (3.75% target for 2024), lower job creation (especially from persistent reduction in (FDI), and overall macroeconomic instability.”

KPMG’s assessment identifies various contributors to this concerning downturn. Factors include macroeconomic instability, a negative interest rate environment, an expanding FX gap coupled with dwindling reserves, and global reclassifications by investment bodies such as FTSE Russell and MSCI, which have adversely influenced external perceptions of Nigeria’s market.

“It also makes the economy more vulnerable to global economic shocks which is especially concerning given the current global poly-crisis,” KPMG noted in its analysis.

The departure of nearly 10 major companies from Nigeria in 2023 has severely eroded investor confidence. Multinational exits like GlaxoSmithKline and Procter & Gamble opting for distributor-led models, coupled with external reclassifications of Nigeria’s market status, have compounded negative sentiments, heightening concerns about the country’s economic stability.

This steep fall in capital importation, despite a temporary upswing in Q2 2023, underscores the urgent need for macroeconomic stability, clear monetary and fiscal policies, and investment-friendly regulatory frameworks.

KPMG also noted the disturbing dominance of short-term capital inflows, particularly trade credit and loans, accounting for around 78% of the total foreign capital inflow of $654.65 million in Q3 2023. This heavy reliance on short-term capital raises concerns about Nigeria’s ability to compete globally and attract sustainable, long-term foreign investment, potentially inflating business costs and diminishing investment attractiveness.

However, amid these challenges, KPMG offers a glimmer of hope, citing reported successes by President Tinubu in securing foreign investment commitments exceeding $15 billion in Foreign Direct Investment (FDI) during international trips. Fulfilling these commitments could significantly reshape Nigeria’s economic trajectory, underlining the urgency of initiatives to augment foreign capital inflows across diverse sectors, it said.

The audit firm’s analysis stresses the imperative of strategic interventions to stabilize Nigeria’s financial sector and foster sustainable growth. It noted that while the decline in foreign inflows poses immediate risks, it also presents an opportunity to foster self-sufficiency, explore alternative financing avenues like domestic savings and capital markets, and nurture local entrepreneurship.

KPMG said that overcoming these economic headwinds will demand the fulfillment of foreign investment commitments and concerted efforts to attract sustainable capital inflows, pivotal in steering Nigeria toward a more resilient and prosperous economic future. The firm’s assessment emphasizes the need for Nigeria to act swiftly and decisively to change its current economic narrative.

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As the 34th African Cup of Nations (AFCON) approaches, the Confederation of African Football (CAF) has made a significant announcement, shaking up both the prize money and the broadcasting landscape for the continent’s most prestigious football tournament.

In a move to amplify the tournament’s allure, CAF revealed a 40% hike in prize money for the 2023 AFCON in Côte d’Ivoire. The winner of this edition is set to secure a substantial $7 million, marking a notable surge from the previous prize. The runner-up is poised to receive $4 million, with $2 million each guaranteed for the two semi-finalists and $1 million for each of the four quarter-finalists.

Patrice Motsepe, the President of CAF, emphasized the significant strides made by the organization in bolstering prize money for not only AFCON but also its other premier competitions.

In a statement to cafonline.com, Motsepe affirmed, “CAF has made significant progress over the past two years in increasing the prize money of the AFCON and all its other major competitions. We have increased the prize money of the AFCON winner to $7,000,000, which is a 40% increase from the previous AFCON prize money.”

Motsepe also expressed confidence in the financial boost benefiting football development and various stakeholders, including member associations, anticipating positive impacts on their administrative capacities.

“I am confident that a portion of the prize money will contribute to developing football and also benefit all the football stakeholders, as well as assist our member associations with their administrations,” he added.

This raise continues a trend of increment in African football prize money in recent years. The 2021 AFCON champions were rewarded with $5 million, a notable increase from the previous $4.5 million. In 2019, the prize money was $4 million, a substantial 64% leap from $1.5 million, demonstrating CAF’s concerted efforts to elevate the tournament’s financial stature.

However, a seismic shift occurred in the broadcasting realm just days before the tournament’s kickoff, as Multichoice’s DStv channels announced they wouldn’t air the biennial event. The decision was attributed to the failure to secure broadcasting rights for the tournament.

“SuperSport Channel will not broadcast the Africa Cup of Nations (AFCON) 2023 scheduled for January 13th to February 11th, 2024, because the channel has not secured the rights to broadcast the tournament,” Multichoice announced.

This development comes following the acquisition of the broadcasting rights by Togolese broadcaster New World TV for all CAF competitions in the Sub-Saharan Africa region, ousting previous holders, including SuperSport International and Canal Plus.

The three-year deal between New World TV and CAF encompasses rights for 13 competitions, including the 2023 and 2025 AFCON tournaments across 46 countries in the region. Consequently, free-to-air stations in these nations seeking to broadcast AFCON and other CAF competitions must sublicense rights through New World TV.

This abrupt blackout on DStv, a longtime broadcaster of football content across Africa, particularly disheartens Nigerian viewers, leaving them bereft of the opportunity to watch the Super Eagles’ pursuit of a fourth AFCON title.

However, the absence of AFCON on DStv signifies a paradigm shift in African football television rights, posing both challenges and opportunities for broadcasters and viewers across the continent