Governor of the Central Bank of Nigeria, Lamido Sanusi, has revealed that the one-year restriction associated with the holding period of the Certificate of Capital Importation (CCI) in the fixed income market will be lifted on the 1 July 2011.[hidepost=9][/hidepost]
Sanusi was speaking at a Standard Bank African Investors Conference in London.
The restriction, which required foreign investors to hold their Naira position for 12 months 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.
“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,” said Stephen Bailey-Smith, head of African research at Standard Bank.
“This will boost the external competitiveness of Nigerian debt instruments, compared with its emerging market and frontier market peers where foreign exchange restrictions are non-existent.”