Despite President Bola Tinubu’s efforts to position foreign capital inflows as a solution to Nigeria’s ongoing economic challenges, latest data from the National Bureau of Statistics (NBS) highlights a troubling trend of underperformance. In the second quarter (Q2) of 2024, Nigeria’s capital importation fell by 22.85% to $2.60 billion, down from $3.37 billion in the first quarter, underscoring the difficulties the country faces in drawing foreign investment.

This decline comes despite a year-on-year increase of 152.8% compared to Q2 2023, suggesting that while Nigeria has made some gains, they are not sustainable or robust enough to significantly impact the economy.

Foreign Direct Investment (FDI), which is crucial for long-term economic growth, plunged to an all-time low of $29.83 million in Q2 2024, a drop of 65.33% from the same period in 2023 and a staggering 74.97% decrease from the preceding quarter. This sharp decline in FDI stands in stark contrast to the government’s promises of attracting significant foreign capital to spur job creation and economic recovery.

Most of the capital inflows during the period came from foreign portfolio investments (FPI), which accounted for 53.93% of the total, followed by other investments, while FDI accounted for a meager 1.15%. The reliance on volatile portfolio investments over more stable and long-term FDI raises concerns about the sustainability of Nigeria’s economic growth trajectory.

This downturn in FDI highlights the persistent challenges Nigeria faces, including a difficult global economic environment, policy uncertainty, and structural domestic issues. Despite the government’s efforts to create a favorable investment climate, the sharp decline in FDI reflects investor apprehension about committing long-term resources to Nigeria, further complicating Tinubu’s plans to leverage foreign capital as a key element in addressing Nigeria’s economic woes.