The presidential candidate of the Labour Party in the 2023 general elections, Mr Peter Obi, has decried Nigeria’s dwindling Foreign Direct Investment (FDI) inflows, warning poor leadership and uncoordinated reforms are driving away long-term investors.
According to the National Bureau of Statistics (NBS), FDI into Nigeria dropped sharply by 70 per cent in the first quarter of 2025 to $126.29 million from $421.8 million in the last quarter of 2024.
Of the total $5.64 billion capital importation into Nigeria in Q1 2025, FDI accounted for only 2.24 per cent, compared to 8.2 per cent in Q4 2024. The bulk of inflows, nearly 90 per cent, went into speculative money market instruments.
According to Mr Obi, such inflows have little impact on industrial growth or job creation.
“With such a high proportion of capital importation flowing into speculative investments, the impact on industrial growth or job creation is highly insignificant and elusive, given the ease with which such ‘hot money’ can exit the economy,” he stated.
He argued that Nigeria’s declining performance in key governance indicators, rule of law, regulatory quality, government effectiveness, and accountability, shows that leadership failure is the biggest obstacle to attracting sustainable investments.
“You cannot attract sustainable foreign investment with poor leadership and governance,” Mr Obi stressed.
The former Anambra State Governor pointed out that capital flows to the manufacturing sector dropped by 32.1 per cent to $129.92 million in Q1 2025 from $191.92 million in the same quarter of 2023.
“There is no better confirmation of the lack of trust in this government, whose reforms remain uncoordinated and largely reactive,” he said.
Comparing Nigeria’s performance with other African countries, Mr Obi highlighted that while global FDI flows fell in 2024, Africa’s inflows surged to $97 billion, a 75 percent rise from 2023. Egypt topped the continent with $46.58 billion, followed by Ethiopia, Côte d’Ivoire, Mozambique, Uganda, DR Congo, South Africa, Namibia, Senegal, Guinea, and Morocco.
“Most disappointingly, our dear nation, Nigeria, the so-called ‘Giant of Africa’ received only $1.08 billion, about 1 percent of Africa’s total FDI, representing a decline of about 42 percent from 2023,” he lamented.
He noted that after the 42 percent drop in 2024, FDI to Nigeria has now further crashed by 75 percent between Q4 2024 and Q1 2025. “We cannot achieve sustainable growth and development with ineffective leadership and a weak government,” Mr Obi warned.