MARKET NEWS

BY  Wasiu Alli

Nigeria attracted its highest level of foreign capital in five years in the first nine months of 2025, as currency reforms and improved dollar liquidity lured offshore investors back into Africa’s most populous economy after a prolonged contraction.

Capital importation into Nigeria jumped 132.27 percent to $16.77 billion in the nine months ended September 2025 from $7.22 billion in the same period two years ago, supported by strong portfolio investment, according to newly released data from the National Bureau of Statistics (NBS).

That figure exceeded the total $12.32 billion capital importation reported in the full year of 2024 and $3.90 billion posted in the same period in 2023, reflecting renewed investor confidence in the country’s economic fundamentals.

Foreign Portfolio Investments (FPIs) accounted for the largest share of capital, with inflows rising 226.09 percent year-on-year to $14.25 billion in nine months. That contrasts with $565.21 million in Foreign Direct Investments (FDI) recorded in the same period.

Analysts linked the surge in FPIs to the high-yield environment in the country due to the high interest rate at 27 percent that has given investors juicy returns but warned of risks as portfolio investments are susceptible to policy shifts.

FDI, a key indicator of real economic growth, remains a major concern despite repeated investment pledges by offshore investors. The last time Africa’s biggest oil producer reported FDIs of up to $1 billion was in 2020, reflecting cautious sentiment despite policy reforms that have made the country more attractive to investors.

Nigeria embarked on sweeping reforms in 2023, including eliminating fuel subsidies that drained billions of dollars, liberalised its foreign exchange markets, and overhauling its archaic tax systems to allow for more efficiency and compliance.

Those reforms have brought stability to the country and put it on its best footing in about a decade. According to the NBS, the banking sector recorded the highest inflow with $3.14 billion, representing 52.25 percent of total capital imported in Q3 2025, followed by the financing sector, valued at $1.85 billion.

Capital importation during the reference period originated largely from the United Kingdom, with $2.93 billion, representing 48.80 percent of the total capital imported. This was followed by the United States with $950.47 billion.

Standard Chartered Bank Nigeria Limited received the highest capital importation into Nigeria in Q3 2025, with $2.11 billion, followed by Stanbic IBTC Bank Plc with $1.78 billion and Citibank Nigeria Limited with $561.40 million.