Total Foreign Direct Investment (FDI) inflows into the country rose by 48.60 per cent, or $176.60 million, to $540 million, in the first 11 months of 2024, compared with $363.40 million in the corresponding period of the preceding year, findings by New Telegraph has shown.

Specifically, an analysis of monthly economic reports for January – November 2024 released by the Central Bank of Nigeria (CBN), indicated that total FDI inflows into the country for the first half of last year stood at $140 million compared with $400 million recorded for between July and November.

Further analysis of the apex bank’s data shows that compared with earlier months of last year when FDI inflow did not reach $100 million, the nation recorded FDI inflow of $180 million and $120 million in October and November respectively.

However, financial experts note that while there was a sharp increase in FDI inflow in the second half of 2024, compared with other types of foreign capital inflow, FDI was significantly low. For instance, commenting on the latest capital importation report released by the National Bureau of Statistics (NBS) analysts at FBNQuest, stated:

“Capital Importation report from the National Bureau of Statistics (NBS) reveals that capital inflows into Nigeria declined by -52 per cent quarter-on-quarter (QoQ) to approximately $1.3 bn in Q3’24. “However, on a year-on-year (YoY) basis, the value was 91 per cent Y-o-Y higher.

“The sequential reduction in capital inflow was driven by double-digit decreases in inflows from Foreign Portfolio Investments (FPI) and other investments of the total capital inflow; portfolio investments comprised approximately 72 per cent, while other investments and Foreign Direct Investments (FDI) accounted for about 20% and eight per cent, respectively.”

The analysts further said: “Despite its significant contribution to capital inflows, FPI inflow fell by -36 per cent QoQ to $899 million, driven by reductions across all segments, with inflows into equity, bonds, and money market investments declining by between -43 per cent and -61 per cent. “Other investments, the next largest segment, declined by -79 per cent QoQ to $250 million.

The share of loans, which typically accounts for over 90 per cent of the category’s inflow, plummeted to $235 million from almost $1.2 billion in Q2’24. “Conversely, foreign direct investment inflow increased to $104 million from $30 m in Q2’24.

Despite the increase, FDI remains significantly low, highlighting ongoing challenges in attracting substantial foreign investment.” Analysts attribute the low FDI inflow to the foreign exchange crisis which the country has grappled with in recent years.

Indeed, data obtained from the CBN and the NBS shows that FDI inflows into Nigeria fell by 21.21 per cent from $3.3 billion in 2019 to $2.6 billion in 2020 and from $698 million in 2021 to $468 million and $377.37 million in 2022 and 2023 respective.