Foreign investors ignored Imo, Enugu, Abia, Ebonyi and 23 other states as the value of capital importation into Nigeria fell by 20.5 percent to $5.33 billion in 2022 from $6.70 billion in 2021.
The National Bureau of Statistics (NBS) disclosed this in its latest Nigerian Capital Importation report for the four quarters of 2022. The publication looks into the value of fresh investments that flowed into the country’s economy in the year under review.
According to the NBS data, the 27 states snubbed by investors include: Abia, Adamawa, Bauchi, Bayelsa, Benue, Borno, Cross River, Delta, Ebonyi, Edo, Enugu, Gombe, Imo, Jigawa, Kaduna, Kano, Kebbi, Kwara, Nasarawa, Niger, Ogun, Osun, Rivers, Sokoto, Taraba, Yobe, and Zamfara.
Lagos Outshined Others To Remain Investors’ Favourite
In 2022, only ten states attracted foreign investments. Lagos took the lead as it outshined others, and the federal capital territory (FCT), to top the list of states that attracted the most investments within the year.
Analysis by TheCable Index shows that the country’s commercial city attracted $3.61 billion in investment, representing 68 percent of the total capital inflow into the country for the period under review. This also shows an increase when compared to the $2.21 billion investment recorded in 2021.
NBS said Abuja (FCT) emerged second top investment destination with $1.63billion — representing 31 percent of the total capital inflow in the country in 2022.
Other states that attracted foreign investments in 2022 are Akwa Ibom ($42.52 million), Anambra ($36.97 million), Oyo ($3.00 million), and Kogi ($2.00 million).
Katsina follows with $0.70 million, Ekiti ($0.51 million), Ondo ($0.20 million), and Plateau ($0.04 million).
Out of 52 countries that invested in Nigeria, the United Kingdom emerged as the top source of capital investment in 2022 with $2.76 billion; followed by South Africa ($428.73 million), Singapore ($420.97 million), and the United States ($286.92 million).
Eight States Failed To Attract Investment In Four Years
Meanwhile, out of the 27 states that were ignored by foreign investors, eight also failed to attract foreign investments in the last four years (2019 -2022). The states are Bayelsa, Ebonyi, Gombe, Jigawa, Kebbi, Taraba, Yobe, and Zamfara.
A recent report by the Debt Management Office (DMO) and the NBS also shows that some of the states are accumulating domestic and foreign debt. According to DMO, apart from Kebbi state, the others had an increase in domestic debt in the last seven years.
Yobe state had a domestic debt growth of +2,247 percent, followed by Taraba at +218 percent, Gombe at +161 percent and Zamfara at +142 percent. Others are Ebonyi with +139 percent growth in domestic debt, followed by Jigawa at +98 percent and Bayelsa at +42 percent. Only Kebbi state (-4 percent) had a decrease in its domestic debt in the last seven years.
On the internally generated revenue (IGR) front, data also shows that the above states are doing poorly in generating revenue for their respective states. The 2021 data released by NBS (which is the latest) shows that Yobe generated N8.5 billion, which is the lowest among the 26 states; followed by Taraba with N9.6 billion, and Kebbi at N9.9 billion.
Gombe generated N10.6 billion as IGR in 2021, followed by Ebonyi (N13.8 billion) and Bayelsa, an oil-producing state, generated N13.3 billion in 2021. Jigawa and Zamfara generated N16.5 billion and N18.9 billion, respectively.
‘Nigeria Losing Foreign Investment To Rising Insecurity’
Speaking on the continued dwindling of Nigeria’s attractiveness to investors, Adejare Bello, the nation’s ambassador to Mexico, said restoring security in the country was a prerequisite for productive investment.
Bello said Mexican investors were willing to “invest heavily in Nigeria’s economy but for the prevailing security situation in the country”.
“The embassy receives frequent enquiries from investors on possible areas of collaboration between both countries but all these efforts to attract foreign investments are being thwarted by the news of insecurity,” he said.
“Some of the areas the foreign investors have been looking to invest include oil and gas, gold mining, agriculture as well as establishing a partnership with Dangote in the area of fertiliser procurement.”
Bello said although the federal government has been proactive in dealing with the security challenges in the country, he advised that the current onslaught against criminals must be sustained. This, according to him, will go a long way to enhance the inflow of foreign direct investment into the country.