By Yinka Kolawole
Foreign investment into Nigeria’s production and manufacturing sector declined sharply by 50.7 percent quarter-on-quarter to $152.27 million in the first quarter of 2026 (Q1’26), down from $308.93 million recorded in the preceding quarter (Q4’25), according to the latest Capital Importation Report released by the National Bureau of Statistics (NBS).
The report revealed that the sector accounted for only 1.47 per cent of the total capital importation valued at $10.37 billion recorded during the review period, highlighting the continued struggle to attract significant foreign capital into the productive segment of the economy.
However, on a year-on-year basis, foreign investment in the sector rose by 17.2 per cent from $129.92 million recorded in the corresponding period of 2025 (Q1’25).
Further analysis of the NBS data showed that the manufacturing sector’s share of total capital inflows has continued to shrink. The 1.47 per cent contribution recorded in Q1’26 was lower than the 2.3 per cent recorded in Q1’25 and significantly below the 4.79 per cent posted in Q4’25.
The report indicated that portfolio investment remained the dominant source of foreign capital, accounting for $9.86 billion or 95.09 per cent of total inflows during the quarter. Other Investments contributed $374.48 million, representing 3.61 per cent, while Foreign Direct Investment (FDI) amounted to $135.08 million, accounting for just 1.30 per cent of total capital imported into the economy.
Sectoral distribution of the inflows showed that the banking sector attracted the largest share of foreign capital, receiving $7.55 billion or 72.79 per cent of total inflows. The financing sector followed with $2.43 billion, representing 23.42 per cent, while production and manufacturing attracted only $152.27 million.
Reacting to the development, Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, said the pattern of capital inflows reflects a persistent structural weakness in the economy, noting that increased foreign capital is yet to translate into meaningful expansion of productive capacity.
He stated: “Without stronger capital flows into industry, agro-processing, logistics, energy and export-oriented manufacturing, the broader economy will see limited gains in employment, productivity and inclusive growth.
“Financial deepening without real-sector expansion risks creating a liquidity-driven recovery that does not fundamentally alter Nigeria’s productive base.”
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