Business

Foreign Capital Imports in Nigeria drop by 78%

Published

6 years ago

September 18, 2020

The National Bureau of Statistics of Nigeria, or NBS, has reported at the start of September that the value of Nigeria’s capital imports fell to $1.29 billion. This means that there is an active decline of 77.88 percent in the value. This is especially troublesome considering the fact that during the first quarter of 2020 the capital import used to be $5.85 billion.

This means that cumulatively, on a year-to-year basis, the drop amounted to a whopping 78.60 percent from what it used to be in the second financial quarter of 2019 ($6.05 billion).

It is no secret that this large decline is largely attributed to the ongoing novel coronavirus pandemic which is currently plaguing the world. Nigeria is not the only country that has been affected by the global problem. Almost every other country in the world is having financial problems with global economies like the US and UK shrinking by 20%. In Nigeria during the period between April and June the Foreign Direct Investment, or FDI, calculated in equities and other capital, has fallen by 30.65 percent on a quarterly and by 33.41 percent on yearly basis. The current number is sitting at $148.59 million. According to NDS, the FDI accounts for almost 12 percent of the total capital that has been imported in the second quarter of 2020. One of the leading causes is portfolio investment (equities, bonds, foreign exchange market, etc). These investments accumulate to 29.76 percent of the total inflow of foreign money. This unit has fallen by an incredible 91.06 percent just between the first and second quarters of 2020 to $385.32 million.

Major capital investment contributor is classified under “other investment” and comprises trade credits, currency deposits, loans, etc. The statistics show that these types of investments account for as much as 58.77 percent of total imported capital or $761.03 million. The decline here is also quite visible as there is a drop of 42.81 percent on quarter to quarter and 48.60 percent on yearly basis.

According to the report made by the NDS, during these times of crisis, Great Britain has become a major capital investor of Nigeria in the second quarter where the inflow of money shows $428.83 million. This is 33.12 percent of the total capital inflow in the second quarter of 2020.

The largest capital importing state is still considered to be Lagos with $1.13 billion or 87.30 percent of the total capital inflow in Q2 of 2020 closely followed by the states of Abuja and Ogun in second and third positions. However, the difference of capital investment here is quite troubling since Abuja has only $145.30 million and the Ogur state is netting $11 million which are 11.20 percent and 0.85 percent of the capital importing total.

The foreign exchange market (Forex, FX) in Nigeria is starting to boom though. Due to the novel coronavirus which has left a huge number of residents unemployed and others locked up in their own homes the number of people who started researching additional ways to generate income has increased by a significant amount. Forex has proved to be a useful instrument in this battle against unemployment. The educational material is freely available online, so it isn’t far from reality that anyone with a decent computer, smartphone, or even a tablet could go through some materials over the internet.

Choosing a proper, licensed broker is also quite an endeavor. However, it is made easier due to the efforts of regulatory bodies that work hard on licensing these firms which afterward have the ability to offer reliable services. If you’re a trader, you can read online forex reviews here to choose your desired broker, test the waters with a demo account, invest, and start trading currency pairs. It is a unique opportunity for people living in developing countries that do not have enough finances to manage the Coronavirus pandemic. This has been successfully done by countries like South Africa, which has introduced its own regulatory body – Financial Services Conduct Authority (FSCA) – that managed to put the country on the global playfield with the South African rand now becoming the 18th most traded currency on Forex globally.

The reason FX is profitable now is because of the Nigerian naira pushing the limits. The currency has become stronger during the last couple of months (everything is comparable) but this can be largely attributed to the fact that the decrease in imports leaves more focus on exports which directly translates to the strengthening of the local currency. However, the margin at which it strengthened leaves something to desire more. Unfortunately, the Nigerian naira has been devaluing for a very long time now and unless something changes in the inner politics of the nation it is not going to improve. The devaluation happens due to the oil prices jumping around constantly. Nigeria is extremely dependent on the crude price. This has gone to the extent where there are multiple exchange rate policies for naira. Currently, it is sitting around N381 which is a 21 point increase from what it used to be prior to the lockdown.

Business

Association Seeks Intervention to Save Domestic Airlines

Published

1 day ago

August 10, 2026

The Tide

The Vice Chairman of the Airline Operators of Nigeria (AON) and Chairman of Air Peace, Mr. Allen Onyema, has called on the Federal Government to urgently intervene in the nation’s aviation industry, warning that several domestic airlines may cease operations if the current challenges confronting the sector are not addressed.

Onyema gave the warning at the public presentation of the book, Pathways, Pilgrimage and Destiny: The Biography of Alhaji Muneer Bankole, held in Lagos and was obtained in Port Harcourt, at the weekend.

He described the aviation industry as being highly capital-intensive with relatively low financial returns, stressing that domestic airline operators are grappling with severe economic pressures that threaten their continued existence.

According to him, the industry has reached a critical stage and requires immediate government intervention to avert the collapse of many indigenous carriers.

Onyema warned that unless decisive measures are taken within the next 30 days, several Nigerian airlines could be forced to shut down their operations due to the harsh operating environment.

He also cautioned aviation labour unions against any planned picketing of airlines over the alleged non-remittance of the five per cent Ticket Sales Charge, saying such action could disrupt flight operations across the country.

The Air Peace Chairman maintained that if any airline was singled out for industrial action, other domestic operators would stand in solidarity, arguing that labour unions should not be used as instruments for resolving debt-related disputes between airlines and government agencies.

He lamented that more than 50 Nigerian airlines had folded over the years despite the success of many of their promoters in other sectors of the economy, attributing the trend to the difficult business environment in the aviation industry.

While reaffirming the commitment of airline operators to support government revenue generation, Onyema stressed that policies capable of crippling airline operations should be reviewed in the interest of the sector.

He noted that a thriving aviation industry remains critical to national economic growth, employment generation and improved connectivity across the country.

The AON Vice Chairman urged the Federal Government to engage relevant stakeholders and adopt sustainable measures that would strengthen the operational capacity and financial stability of indigenous airlines.

He expressed optimism that with timely policy support and constructive engagement between government and industry stakeholders, the nation’s aviation sector would overcome its current challenges and continue to contribute meaningfully to Nigeria’s socio-economic development.

King Onunwor

Business

CBN Reforms Impact Consumers As Dollar Card Spending Limits Rise

Published

1 day ago

August 10, 2026

The Tide

The Central Bank of Nigeria’s (CBN) foreign exchange reforms are beginning to deliver tangible benefits to consumers, as banks expand international spending limits on naira cards amid improved liquidity in the foreign exchange market.

The new limit represents a sharp increase from the $6,000 quarterly cap introduced in November 2025 and is 20-times higher than the $1,000 quarterly limit announced in July 2025.

The move comes as analysts point to a more liquid foreign exchange market following reforms introduced by the CBN over the past three years.

“This reflects the improved liquidity in the foreign exchange market. It also shows the focus of banks in maximising income from card payments,” said Ayokunle Olubunmi, head of Financial Institutions Ratings at Agusto & Co.

Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise (CPPE), said the increase in card spending limits reflects the significant improvement in liquidity and confidence in Nigeria’s foreign exchange market.

“It’s an indication that the liquidity in the foreign exchange market has improved significantly and we can see that from the stability of the exchange rate. We can also see that reflected in our foreign reserves. All of these things reflect the level of confidence,” Yusuf said.

According to him, businesses and individuals are no longer under pressure to obtain foreign exchange for legitimate transactions, unlike in the past when access to dollars was constrained.

“It also means that citizens and those who use foreign exchange are no longer desperate about foreign exchange usage. Whether you want to use it through your card or access it for international trade, there is no anxiety, there is no pressure and there is no desperation.

All of these things have arisen because the level of confidence in the foreign exchange market and the outlook for the market have been very reassuring,” he said.

Yusuf added that the adjustment of international spending limits by banks demonstrates growing confidence in the sustainability of the foreign exchange market reforms.

“That is why we are seeing all these positive developments around the use of the naira card abroad and the limits that are now being adjusted by banks. It is a very good development and I hope we can sustain it. I am confident we will.”

The increase follows a series of policy changes by the apex bank aimed at deepening the foreign exchange market and improving access to foreign currency for legitimate transactions.

Under the CBN’s Foreign Exchange Manual, Fourth Edition, the maximum tuition fee remittance for Nigerian students pursuing undergraduate and postgraduate studies abroad was raised to $25,000 per semester, from the previous $15,000.

“Payment of tuition fees for undergraduate/postgraduate studies shall be subject to a maximum limit of $25,000.00 per semester,” the Manual states.

The expansion of international card limits also reflects growing confidence among lenders that foreign exchange liquidity has improved enough to support retail dollar transactions.

Speaking recently at the BusinessDay 14th Annual CEO Forum in Lagos, CBN Olayemi Cardoso, governor of the CBN said buying and selling activities now increasingly determine outcomes in the foreign exchange market, unlike in the past when market participants relied heavily on routine Central Bank interventions.

According to Cardoso, Nigeria’s net foreign exchange reserves have risen from just over $3 billion at the start of the reform programme to more than $40 billion, while gross reserves have climbed to about $52 billion, providing stronger confidence for investors and enabling the Central Bank to reserve interventions for periods of market stress rather than day-to-day liquidity management.

The restoration and expansion of international naira card spending limits are increasingly being seen as one of the clearest signs that the benefits of the CBN’s foreign exchange reforms are beginning to reach households, students and businesses making legitimate cross-border payments.

Business

WEC: FG Inaugurates Governing Board … As Nigeria Rejoins Council

Published

1 day ago

August 10, 2026

The Tide

Nigeria has rejoined the World Energy Council (WEC) with the inauguration of a National Member Committee and Governing Board to strengthen the country’s participation in global energy policy and investment discussions.

The Secretary-General and Chief Executive Officer, WEC, Dr Angela Wilkinson, disclosed this in a statement, last Thursday.

The Governing Board is chaired by the Chairman of Waltersmith Petroman Oil Ltd., Abdulrazaq Isa, while a former Chief Upstream Investment Officer of NNPC Ltd., Bala Wunti, will serve as the inaugural Chief Executive Officer.

Other members of the board are Prof. Wumi Iledare, Dr Mustapha Abdullahi, Mrs Aisha Farida Katagum, Dr Ainojie Irune, Dr Emmanuel Okon, Dr Victor Ekpenyong and Dr Imamuddeen Talba.

The Secretary-General and Chief Executive Officer, WEC, Dr Angela Wilkinson, who disclosed this in a statement, last Thursday, said the board comprises of experts in energy policy, regulation, investment, operations, research, technology and enterprise development.

Welcoming Nigeria into the council, Wilkinson said the country’s membership would strengthen its contribution to global energy discourse.

Wilkinson noted that “Nigeria has a significant leadership role to play within the global energy community.

“Nigeria has a significant leadership role, and the Member Committee will help bring that expertise and voice onto the world stage at the Riyadh World Energy Congress in April 2027 and beyond.

“Nigeria’s participation comes at a pivotal time as the country seeks to expand energy access, strengthen energy security, accelerate gas development and mobilise the capital required for industrialisation and sustainable economic growth.

“WEC Nigeria will convene leaders from across the energy ecosystem, apply the WEC’s globally recognised Energy Trilemma framework to Nigeria’s unique context, and promote evidence-based dialogue, practical collaboration and informed policymaking.

“It will also ensure that Nigerian and broader African perspectives contribute meaningfully to global energy conversations,” she said.

Wilkinson expressed confidence that Nigeria would play a significant leadership role at the World Energy Congress scheduled for Riyadh in April 2027 and beyond.

The statement also quoted the Chairman of WEC Nigeria, Isa, as describing the country’s participation as an opportunity to deepen national and African leadership within the global energy community through practical solutions tailored to regional development priorities.

He said the platform would promote collaboration across sectors and attract sustainable investments into Nigeria’s energy sector.

The Chief Executive Officer of WEC Nigeria, Wunti, was quoted in the statement as saying that the council would connect leadership, evidence and investment to build a secure, affordable and sustainable energy system.

“This system will be capable of driving economic growth and shared prosperity.”

According to him, the platform will also connect Nigerian institutions and businesses with international knowledge, technology, partnerships and investment opportunities through the World Energy Council’s global network.

Recall that WEC, founded in 1923, is the world’s oldest independent and impartial community of energy leaders and practitioners, advancing informed, collaborative and practical action across the global energy system.

Nigeria has been a member of the council with the Nigerian National Committee originally approved and established on April 6, 1960 before its re-establishment and expansion this year.

The renewed membership would provide an independent, technology-neutral platform bringing together government, industry, academia, finance and civil society to address Nigeria’s energy security, energy equity and environmental sustainability.