UK leads capital inflows into Nigeria with $2.94bn in Q3 2025
The United Kingdom has been identified as the largest source of capital importation into Nigeria during the third quarter of 2025, contributing nearly half of all foreign capital inflows recorded in the period, according to official data released by the National Bureau of Statistics.
Figures published by the NBS on its X handle on Monday revealed that capital inflows from the UK totaled $2.94 billion, accounting for 48.80 per cent of total capital imported into the Nigerian economy between July and September 2025.
The United States ranked second with $950.47 million, representing 15.80 per cent of total inflows, while the Republic of South Africa contributed $773.95 million, or 12.87 per cent of the capital recorded during the quarter.
Other significant contributors included Mauritius, which accounted for $451.46 million, and the Netherlands, which brought in $282.90 million during the same period.
The NBS stated that the data, sourced from the Central Bank of Nigeria, reflects fresh capital entering the economy through commercial banks and does not include other components of foreign direct investment such as reinvested earnings or inter-company loans.
Capital importation data is a key economic indicator used to measure foreign investor confidence and the flow of external resources into critical sectors of the economy. It is typically categorised into foreign direct investment, portfolio investment, and other investments, with each classification reflecting different levels of commitment and economic impact.
The statistics released cover capital inflows through equity investments, loans, and portfolio instruments such as money market securities and bonds. The figures are compiled from returns submitted by authorised dealer banks to the Central Bank and processed by the NBS as part of its quarterly economic reporting mandate.
According to the report, the strong performance in Q3 2025 signals a notable rebound in foreign investor appetite for Nigerian assets, driven largely by short-term portfolio flows into money market instruments and government bonds.
Portfolio investment, which includes securities trading and debt instruments, has historically accounted for a significant share of Nigeria’s capital importation, reflecting investor interest in high-yielding financial products amid global monetary policy shifts and domestic fiscal adjustments.
However, analysts have cautioned that the relatively low share of foreign direct investment within the capital importation mix suggests that long-term, productive capital committed to infrastructure, manufacturing, and other real economy sectors remains modest compared to more liquid, short-term financial investments.
Foreign direct investment is generally considered more stable and economically beneficial than portfolio flows, as it typically involves long-term commitments to physical assets, job creation, technology transfer, and sustained operations within the host economy.
The dominance of portfolio investment in Nigeria’s capital structure has raised concerns among economic observers about the sustainability of capital inflows, particularly in periods of global financial volatility when such investments can be quickly withdrawn.
The trend underscores Nigeria’s growing appeal to portfolio investors seeking returns in emerging markets, while simultaneously highlighting the need for deliberate policy reforms aimed at attracting sustained, long-term investment capable of driving structural economic growth.
Nigeria has in recent years implemented a series of economic reforms intended to improve the investment climate, including foreign exchange liberalisation, removal of fuel subsidies, and efforts to harmonise multiple exchange rate windows. These measures have been designed to restore macroeconomic stability and rebuild investor confidence following years of currency volatility and fiscal uncertainty.
The Central Bank of Nigeria, under the leadership of Governor Yemi Cardoso, has pursued aggressive monetary tightening to curb inflation and stabilise the naira, while also seeking to attract foreign capital through competitive interest rates on government securities.
Despite these efforts, structural challenges including regulatory inconsistencies, infrastructure deficits, security concerns, and bureaucratic bottlenecks continue to constrain the flow of greenfield foreign direct investment into productive sectors of the economy.
Economic analysts have consistently called for comprehensive reforms in areas such as ease of doing business, legal and institutional frameworks, trade facilitation, and investment protection to create an enabling environment for long-term capital commitments.
The NBS capital importation data for Q3 2025 reflects a broader recovery trend observed across sub-Saharan Africa, where portfolio flows have rebounded following a period of risk aversion triggered by global monetary policy tightening and domestic economic pressures in key frontier markets.
Nigeria’s capital market has seen increased foreign participation in recent quarters, supported by improved liquidity conditions, stable bond yields, and positive sentiment around the federal government’s reform agenda.
The UK’s leading position as a source of capital inflows is consistent with historical patterns, given London’s status as a major global financial centre and the significant presence of Nigeria-focused investment funds and asset managers domiciled in the British capital.
The United States, traditionally a major source of both portfolio and direct investment into Nigeria, maintained its second-place position, reflecting sustained interest from American institutional investors and corporations with operations or strategic interests in the Nigerian market.
South Africa’s strong showing as the third-largest contributor highlights the ongoing economic linkages between Nigeria and Africa’s most industrialised economy, with South African firms maintaining substantial investments in Nigeria’s banking, telecommunications, retail, and consumer goods sectors.
The prominence of Mauritius and the Netherlands in the capital importation rankings also reflects their roles as favoured jurisdictions for international investment vehicles and holding structures used by multinational corporations and private equity firms investing in African markets.
Both countries offer favourable tax treaties and investment protection agreements with Nigeria, making them attractive conduits for routing capital into the Nigerian economy.
The NBS report forms part of the bureau’s regular statistical releases, which provide critical data for policymakers, investors, and analysts tracking economic performance and capital flows across various sectors and regions.
Capital importation figures are closely monitored by financial market participants as indicators of investor sentiment, foreign exchange supply dynamics, and the overall health of Nigeria’s external sector.
The data released on Monday is expected to inform ongoing policy discussions around foreign investment promotion, exchange rate management, and efforts to diversify Nigeria’s economic base beyond oil revenues.