Nigeria has witnessed a significant decline in Foreign Direct Investments (FDI) over the past decade, amounting to a $19 billion drop, according to recent disclosures by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy.
This was revealed during a presentation to top business leaders in Lagos, shedding light on the economic challenges facing the nation and the government’s strategies to address them.
Edun’s presentation highlighted the concerning trajectory of FDI inflows into Nigeria, which plummeted from $22.7 billion in 2014 to a mere $3.7 billion in 2023. This decline underscores the pressing need for initiatives to bolster investor confidence and stimulate economic growth.
The Minister emphasized the important role of FDI in the government’s economic reforms, aimed at enhancing foreign exchange supply through increased investments, both direct and portfolio-based. Despite sporadic fluctuations, the overall trend reflects a downward trajectory in FDI, posing challenges for sustainable economic development.
In response to the downturn, the Federal Government announced plans to issue domestic bonds denominated in foreign currency in a bid to attract additional foreign exchange inflows and stabilize the national currency. Edun highlighted the importance of restoring faith in the local currency to incentivize investment and savings in dollars.
However, the decline in FDI comes amidst claims by the Minister of Trade, Industry and Investment, Doris Uuzoka-Anite, of attracting $30 billion worth of investments during President Bola Tinubu’s initial eight months in office. Anite clarified that these commitments represent promises from investors spread over several years, encompassing various sectors of the economy.
Despite government efforts, challenges persist in attracting foreign investors, as highlighted by Edun’s remarks at the 40th annual Conference of the Chartered Institute of Directors. He attributed the lack of investor appetite to external factors such as rising inflation in Western countries, necessitating alternative solutions and investments from the corporate sector.
Edun reiterated the government’s commitment to enhancing productivity, fostering economic growth, job creation, and poverty reduction. He stated the importance of creating an environment conducive to attracting foreign investments and domestic resource mobilization, aligning with President Tinubu’s economic policies.
