Nigeria’s Investment Landscape Flourishes with 66.27% Surge in Foreign Capital Inflows in Q4 2023.

In the fourth quarter of 2023, Nigeria experienced a remarkable increase in Capital inflows, soaring by 66.27% compared to the preceding quarter. This surge, from $654.65 million in Q3 2023 to $1.09 billion in Q4 2023, signals a robust economic recovery and reflects the efficacy of President Bola Tinubu’s administration’s strategies to bolster the nation’s investment attractiveness.

According to the latest report by the National Bureau of Statistics (NBS), this upsurge in Capital Importation underscores the success of governmental policies, contributing to a year-on-year growth trajectory. Additionally, Q4 2023 figures slightly exceeded the $1.06 billion recorded in the same period in 2022, indicating a modest year-on-year improvement of 2.62%.

This resurgence symbolizes the resilience of Nigeria’s economic landscape, with the increased capital inflows reflecting growing investor confidence in the country’s market potential and the leadership direction under President Tinubu.

Investment Breakdown by Type and Sector A breakdown of Nigeria’s capital importation in Q4 2023 reveals that “Other Investment” emerged as the dominant category, capturing 54.64% or $594.74 million of the total capital inflows. Following closely, Portfolio Investment accounted for 28.46% or $309.76 million, while Foreign Direct Investment (FDI) contributed 16.90% or $183.97 million to the influx.

Sector-wise, the production/manufacturing sector led with an impressive $450.11 million, constituting 41.35% of the quarter’s total capital inflow. The banking sector followed, securing $283.30 million (26.03% of investments), with the financing sector making a notable entry at $135.59 million (12.46% of total capital imported).

Origin of Foreign Capital During the period under review, the majority of Nigeria’s capital importation stemmed from investments originating in the United Kingdom, contributing $267.24 million (24.55% share). Mauritius followed closely with $226.18 million (20.78% of total capital importation), while the Netherlands made a substantial impact with investments amounting to $149.93 million (13.77% share).

Regional Distribution of Investments Lagos State retained its position as Nigeria’s premier investment hub, attracting $771.68 million in capital importation, accounting for 65.38% of the nation’s total inflows. Abuja (FCT) followed, drawing $370.80 million (34.07% of total capital importation), while Rivers State secured $6.00 million (0.55% of total capital imported).

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Top Recipient Banks Stanbic IBTC Bank Plc emerged as the foremost recipient of capital importation, amassing $499.45 million (45.88% of total inflows) in Q4 2023. Citibank Nigeria Limited secured the second position with $229.06 million (21.04% of total capital imported), while Rand Merchant Bank Plc garnered $85.85 million, accounting for 7.89% of Nigeria’s total capital importation.

Additional Insights President Bola Tinubu’s international engagements have yielded significant results, with Nigeria witnessing a rebound in investment following earlier hesitations. The Federal Minister of Information and National Orientation, Mohammed Idris, highlighted that these diplomatic efforts have secured over $15 billion in Foreign Direct Investment (FDI) commitments across various sectors. Minister Idris emphasized that President Tinubu’s proactive engagements abroad have showcased Nigeria’s commitment to global economic cooperation and highlighted its immense investment potential.

Echoing this optimistic outlook, the Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, noted a renewed interest among portfolio investors seeking to re-engage with the Nigerian market. The latest statistics on capital importation into Nigeria affirm this positive trend, marking a significant upswing in investor sentiment and participation in the Nigerian economy.

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