THE Federal Capital Territory (FCT) Abuja ranked the top destination for foreign inflows into the country as capital importation rose to $5.64 billion in the first quarter (Q1) of the year.
This was contained in the latest report, ‘Nigeria Capital Importation Q1 2025’, released by the National Bureau of Statistics (NBS) on Tuesday, August 5.
It indicated that out of the five states that recorded capital importation during the quarter, Abuja pulled $3.05 billion to top the states that attracted foreign inflows, accounting for 54.11 per cent of the total capital importation.
Check by The ICIR shows that this will be the first time Lagos is overtaken as the top destination for foreign investment into the country.
Following, Lagos attracted $2.56 billion to become the second top destination through which capital importation came into the country in the review period.
Ogun state attracted $7.95 million, Oyo $7.81 7.81million, and Kaduna $4.06 million, respectively.
The ICIR had reported that there has been concern over fewer states out of the 36 states and the FCT attracting foreign inflows into the country.
However, Nigeria’s total capital importation rose to $5.6 billion in Q1 of the year from $3.4 billion in the same period of 2024.
It represents a slight increase when compared to $5.09 billion recorded in the fourth quarter (Q4) of 2024.
“In Q1 2025, total capital importation into Nigeria stood at $5642.07 million, higher than $3376.01 million recorded in Q1 2024, indicating an increase of 67.12%.
“In comparison to the preceding quarter, capital importation increased by 10.86% from $5089.16 million in Q4 2024,” NBS stated.
Capital importation is the influx of external funds Nigeria receives from investment, trade, and business production from other countries.
A breakdown of the inflow showed that portfolio investment ranked top with $5.2 billion, accounting for 92.25 per cent, followed by other investment inflow with $311.17 million, and foreign direct investment $126.29 million, which recorded the least inflow.
The ICIR reports that portfolio investments are regarded as ‘hot’ money that foreign investors bring into acquiring Nigeria’s bonds and stocks.
Analysts decry this type of investment as the investors are likely to take their funds out of the country when they sense economic trouble.
The investments are also easier to dispose of than foreign direct investment, which improves under a business-friendly environment.
In an earlier report, The ICIR analysed why Nigeria should attract more foreign direct investment which has continued to record the least inflow.
A substantial and long-term investment made into a project or building a firm in the country, foreign direct investment is crucial for the country’s economic growth.
Attracting higher foreign direct investment, analysts believe, would strengthen the naira against other currencies and bring about foreign exchange liquidity in the country.