Nigeria’s capital inflows hit $5.6bn in Q1 — but 92% came from short-term investment

Nigeria recorded a sharp rise in capital inflows in the first quarter of 2025 — but most of the money came from short-term investments.

A review by Daily Times shows that the bulk of the capital was not in the form of long-term commitments that could support broader economic growth.

According to the latest report by the National Bureau of Statistics (NBS), total capital importation stood at $5.64 billion in Q1 2025 — a 67.1 percent increase from the $3.38 billion recorded in the same period last year.

It also marked a 10.9 percent rise from the $5.1 billion received in the fourth quarter of 2024.

“In Q1 2025, total capital importation into Nigeria stood at US$5,642.07 million, higher than US$3,376.01 million recorded in Q1 2024, indicating an increase of 67.12%,” the report reads.

“In comparison to the preceding quarter, capital importation increased by 10.86% from US$5,089.16 million in Q4 2024.”

Portfolio Investment Dominates Capital Flows

The NBS data reveals that portfolio investment — often considered volatile or speculative — accounted for the overwhelming share of capital inflows.

It made up 92.3 percent of the total, translating to over $5.2 billion in short-term investments such as stocks and bonds.

By contrast, foreign direct investment (FDI), regarded as a more stable and long-term economic driver, contributed just 2.2 percent — amounting to $126.29 million.

“Foreign Direct Investment recorded the least with US$126.29 million, accounting for 2.24% of total capital importation in Q1 2025,” the NBS stated.

Banking Sector Attracts Bulk of Capital

The banking sector received the largest chunk of the capital inflow — $3.13 billion, or 55.4 percent of the total.

It was followed by the financing sector, which attracted $2.1 billion.

Together, both sectors accounted for more than 92 percent of the entire capital imported during the quarter.

“The Banking sector recorded the highest inflow with US$3,127.92 million, representing 55.44% of total capital imported in Q1 2025, followed by the Financing sector, valued at US$2,097.48 million (37.18%),” the report noted.

The production and manufacturing sector received just $129.92 million, representing 2.3 percent of total inflows.

Investment Concentrated in Abuja, Lagos

Capital importation was heavily concentrated in two locations — Abuja and Lagos.

Abuja led the chart with $3.05 billion, followed by Lagos with $2.56 billion.

Only three other states — Ogun, Oyo and Kaduna — recorded capital inflows, though significantly less.

“Out of the five states that recorded capital importation during the quarter, Abuja (FCT) remained the top destination with US$3,047.45 million, accounting for 54.11% of the total capital imported. Lagos State followed with US$2,564.68 million (45.44%), and Ogun State with US$7.95 million (0.14%),” the report said.

The United Kingdom remained Nigeria’s biggest source of foreign capital in the first quarter, contributing $3.68 billion — 65.3 percent of the total.

South Africa followed with $501.29 million, and Mauritius contributed $394.51 million.

Among banks, Standard Chartered Bank Nigeria received the highest capital inflow, totalling $2.1 billion.

It was followed by Stanbic IBTC Bank with $1.4 billion and Citibank Nigeria with $1.05 billion.