Nigeria's Capital Inflow Surge: CPPE Links Growth to Reforms, Warns on Portfolio Dominance
Nigeria's capital importation surged to $6.01 billion in Q3 2025, up from $1.25 billion in Q3 2024, according to the National Bureau of Statistics (NBS). The Centre for the Promotion of Private Enterprise (CPPE) attributes this growth to recent macroeconomic reforms including foreign-exchange liberalisation and tighter monetary policy. However, the CPPE warns the inflows are overwhelmingly portfolio-driven (over 80%), concentrated in the financial sector, and sensitive to global interest rates and policy credibility. While providing short-term liquidity, portfolio investments lack durability for long-term economic transformation. The CPPE stresses the need for structural reforms to channel capital into productive sectors like manufacturing, infrastructure, and agro-processing to attract sustainable foreign direct investment (FDI). Without this shift, Nigeria risks a liquidity-driven recovery without fundamental economic change. The CPPE also highlights concentration risks from reliance on UK, US, and South African investors and recommends diversifying capital sources through Gulf sovereign wealth funds and intra-African investment under AfCFTA.