The Nigerian Investment Promotion Commission (NIPC) has revealed that investments into Nigeria witnessed a significant increase in the first three months of the year.
According to the commission $8.41 billion was tracked as investment announcements for the first quarter (Q1) of 2021, which is 75 percent more than the value in the corresponding period in 2020 (US$4.81 billion), with construction and manufacturing as preferred sectors.
The report titled “report of investment announcements in Nigeria (January – March 2021)” shows Balyesa and Delta States emerged top investment destinations during the period, followed by Akwa Ibom and Lagos States.
The report also revealed that the leading four destinations accounted for 97 percent of the total investments announced as against 56 percent in the corresponding period in 2020.
According to NIPC, Bayelsa State received $3.6 billion in mining and quarrying. Delta State recorded $2.94 billion worth of announcements in seaport construction and power transmission, Akwa Ibom State had $1.4 billion announced in mining and quarrying, and Lagos State with announcements totalling US$0.26 billion in finance, insurance, and manufacturing.”
By sector, manufacturing received the largest investment accounting for 60 percent at $5.08 billion, followed by construction at $2.90 billion (34 percent), electricity at $0.26 billion (3 percent), agriculture $0.11 billion (1 percent), and others at $0.07 billion (1 percent). Domestic investors accounted for 35 percent of the announcements at $2.95 billion.
Other sources were Morocco $1.40 billion, United Kingdom $0.24 billion, and United States $0.08 billion.
In terms of volume, NIPC said Nigeria received 15 projects across eight states compared to Q1 2020 with 19 projects across 14 states including the Federal Capital Territory (FCT).
NIPC, however, noted that the investments figures were only based on 340 news articles cited in NIPC’s Newsletters from January to March 2021 and might not be exhaustive.
NIPC also noted that investment announcements do not necessarily translate to actual investment inflow but gives a sense of investors’ interest in the Nigerian economy.
“The gaps between announcements and actual investments demonstrate investment potential announcements and actual investment potential. For instance or instance, out of total investment announcements of $16.74 billion reported in 2020, only $2.6 billion actual foreign direct investment (FDI) inflow was recorded,” NIPC stated.
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