Experts Fault Capital Inflows Euphoria As Investors Shun Productive Sectors

Prominent economists and financial analysts have raised concerns over the recent surge in capital inflows into Nigeria, as the majority of the investments are directed towards money market instruments rather than productive sectors. The Q1 2025 Capital Importation report by the National Bureau of Statistics revealed a 67% increase in total capital inflow to $6 billion, with 90% of the inflow driven by speculative funds seeking high returns.

Foreign Direct Investment (FDI) in Nigeria declined by 9% to $7 million in Q1 2025, despite an overall increase in capital importation. Experts warn that the country's economy, still largely dependent on oil, is not built on a productive base and is at risk of collapse if the current trend continues.

They emphasize the need for investments in infrastructure and productive sectors to drive real economic growth and reduce reliance on oil revenue.