The National Bureau of Statistics (NBS) recently released its report on Nigeria’s capital importation for the first quarter of 2024, highlighting a surge in foreign investments. 

The total capital importation for Q1 2024 stood at $3,376.01 million, an increase of 198.06% compared to the $1,132.65 million recorded in the same quarter of the previous year. 

In Q1 2024, the composition of capital importation showed a prevalent preference for portfolio investments. These investments amounted to $2,005.59 million, representing 61.48% of the total capital importation. 

This was followed by other types of investments, which accounted for $1,181.25 million (34.99%). Foreign Direct Investment (FDI) contributed the least, with $119.18 million, making up 3.53% of the total.

The quarter-on-quarter analysis revealed that compared to Q4 2023, where the capital importation was $1,088.48 million, Q1 2024 saw a rise of 210.16%. This increase points to the growing attractiveness of Nigeria as an investment destination.

The report also delves into the origins of these investments, with the United Kingdom leading. 

Investments from the UK amounted to $1,805.83 million, constituting 53.49% of the total capital imported. 

Following the UK, the Republic of South Africa contributed $582.34 million (17.25%), and the Cayman Islands provided $186.21 million (5.52%).

Lagos State emerged as the prime destination for these investments, attracting $2,782.41 million, which is 82.42% of the total capital imported. 

Abuja (Federal Capital Territory) followed with $593.58 million, accounting for 17.58%. Notably, Ekiti State received a minimal share of $0.01 million.

The sectoral analysis shows that the banking sector attracted the highest capital inflow in Q1 2024, with a total of $2,067.44 million. This was followed by the trading sector, which received $494.93 million, and the production/manufacturing sector, which garnered $191.92 million. 

The increase in capital importation is a positive indicator for Nigeria’s economic health. It indicates a renewed confidence among foreign investors in the country’s economic stability and growth potential. The influx of capital is expected to spur economic activities, create jobs, and contribute to overall development.

While the data from Q1 2024 is promising, it is important to sustain this momentum. The need for continuous implementation of investor-friendly policies and addressing underlying issues that could deter future investments is key.

Understanding the drivers behind this surge in capital importation will be essential for maintaining and enhancing Nigeria’s attractiveness to foreign investors.