As the Nigerian government sets sail to attract more foreign direct investments into the economy in 2025, experts have called for strengthening policies to position the country as an investment destination worldwide.

In a recent edition of the Arise News Morning Show, economist Dr. Ayo Teriba stressed the need to reform the country's investment laws to facilitate investments.

He noted that countries like the United Arab Emirates and Saudi Arabia have attracted significant investment inflows because of the reforms in their respective investment laws. The economist believed an improvement in foreign direct investment inflows would boost the country’s revenue earnings and foreign exchange inflows and increase its foreign reserves.

“With foreign reserve adequacy, Nigeria can stabilize its foreign exchange market, which will begin to address macro-economic issues like the high inflation rate. Nigeria must unlock wealth from its assets by turning to equity financing and issuing investment grade bonds.”

Dr. Teriba emphasized the need for the Nigerian government to leverage the capital market and take pragmatic steps to list some state-owned enterprises, like the Nigerian National Petroleum Company Limited. He pointed out that Nigeria has no state-owned enterprise listed in the market.

The Chartered Institute of Stockbrokers, in its recent 13-point communique on how to grow a $1trn Nigerian economy through the capital market, alluded to Dr. Teriba's position by calling for listing the NNPCL and other moribund state enterprises on the secondary markets to deepen the markets, enhance the companies' ability to make profit and generate revenue for the government through tax. 

According to the CIS, “Policies should incentivize Indigenous and privatized companies and SMEs to list on the Nigerian capital market. This can be achieved through tax holidays and patronage of products and services of quoted companies. The government should conclude the ongoing review of the Investment and Securities Act (ISA). In contrast, the capital market regulators should review relevant rules and laws in line with the global best practices to boost investor confidence, create a favorable business environment for listed companies, and remove restrictions hindering liquidity access for stockbrokers.”

In its 2025 economic outlook report titled Unlocking Nigeria’s Economic Prosperity, Proshare analysts called for the Securitization and Financialization of idle public assets to release underlying economic value. The analysts argued that idle public assets could generate cash flows that would reduce the need for public debt issuances.  “For example, military barracks in prime land locations across the federation hinder the alternative use of such land; the same could be said of the Nigerian Customs Service and the Nigerian Police. Long-term lease or sale arrangements would support the increase of the country's foreign reserve and provide a market-determined valuation of public assets that could be traded on a formal equity exchange. If this is done in the first half of 2025, the government will find it easier to reduce high domestic inflation rates and strengthen the value of the naira in the foreign exchange (FX) market,” the Proshare report added.

Nigeria’s Capital Importation report, which the National Bureau of Statistics (NBS) captured for the first three quarters of 2024, shows that total FDI inflows reached $253.8m. 

The NBS, in its commentary, noted that despite the increase from $30m in Q2 2024 to $104m in Q3 2024, FDIs remain significantly low, highlighting ongoing challenges in attracting substantial foreign investment into the country.

With Dr. Jumoke Oduwole now responsible for coordinating Nigeria’s trade and investment policies alongside Senator John Owan Enoh, the expectation is that Nigeria’s FDI inflows will improve significantly in 2025, backed by robust investment policies.

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