The Federal Government has said that the total value of investments in Nigeria declined from $8.42 billion in the first quarter (Q1) of 2021 to $1.69 billion in the second quarter (Q2) of 2021, indicating a drop of about 80%.
However, the total value of investments for H1 of 2021 is $5.05 billion higher compared with the same period for the previous year where the total value of investments is $5.06 billion.
This disclosure is contained in the latest Report of Investment Announcement in Nigeria by the Nigerian Investment Promotion Commission (NIPC) and can be seen on its website.
An analysis of the report on investment announcements by sectors revealed that the manufacturing sector attracted the highest investments with $5.9 billion or 58%, followed by construction with $2.9 billion or 29% and electricity (which includes gas, steam and air conditioning supply) with $680 million or 7%.
The report also shows that information and communication with $410 million or 4% of the investments is next while others recorded $210m or 2%.
On the analysis of the destination of these investments, Bayelsa and Delta states attracted the most investments out of the 14 states that were listed, with $3.60 billion or 36% and $2.94 billion or 29% of the investments respectively.
They were followed by Akwa Ibom with $1.40 billion or 14% of the investments, Lagos with $0.70 billion or 7% of the investments while the remaining 10 states altogether attracted a total investment of $1.45 billion or 15%.
A further breakdown of the report also shows that Nigerian investors made the highest contribution of $3.29 billion or 33% of the total investment, followed by Morocco with a total investment of $1.40 billion or 14%, China with $950 million or 9% of the investments, United Kingdom with $640 million or 6% of the investments and others with $3.82 billion or 38% of the investments.
Some of the companies and institutions involved in these investments include the Nigerian National Petroleum Corporation (NNPC), Flour Mills of Nigeria Plc, OCP of Morocco, Dahua Paper Company, Transcorp, West African ENRG, Konexa, PowerDot, SoftBank/Sequoia Capital China/IDG Capital, Others.
Also, the report showed that in the past 5 years, investment announcements recorded in H1 2021 decreased by $9.23 billion from the $19.34 billion recorded in H1 2017.
The Federal Government has been on an investment drive both within and outside the country in order to diversify the economy, reduce dependence on crude oil for revenue and foreign exchange, create employment and ultimately drive the economy.
The decline in investments could be attributed to the serious security crisis across the country, instability of the country’s foreign exchange market, poor state of infrastructure and power supply, unfavourable investment climate, among others.
The Executive Secretary, NIPC, Yewande Sadiku, had recently said that the commission is collaborating with the private sector to unlock potential investments in the country.
According to her, there are huge investment opportunities in agriculture, transportation, solid minerals and manufacturing sectors of the economy and the government is working to improving the country’s rating in the area of ease of doing business.