Accordingly, the Foreign Direct Investment into Nigeria in the second quarter of 2024 dropped to $29.83m, marking the lowest level ever recorded based on available data up to 2013, findings have revealed. Similarly, it also dropped by 74.97% from the $119.18m reported in the preceding quarter of 2024.

Meanwhile, economists blame the significant drop in FDI on the naira devaluation and the unstable foreign exchange market, as the naira lost about 40% of its value in the first six months of 2024.

Data from the NBS shows that Nigeria’s FDI includes equity and other capital. Most of the FDI in Q2 2024 came from equity investment, amounting to $29.82m. On a year-on-year basis, equity investment declined by 65.33% from $86.02m in Q2 2023.

The other component of FDI, classified as “Other Capital,” recorded a minimal inflow of $0.0085m in Q2 2024, which is down by 33.33% from $0.01275m in both Q1 2024 and Q2 2023.

Although this category traditionally accounts for a very small fraction of FDI, the decline indicates a further reduction in this already limited source of capital.

Despite the claim by President Bola Tinubu that his administration has successfully drawn $30bn in FDI commitments, the decline in FDI highlights the challenges Nigeria faces in attracting long-term investment amid a challenging global economic environment and domestic issues.

It was also observed that FDI made up only about 1.15% of the total capital importation of $2.60bn in the quarter under review. Also, foreign currency loans, which include portfolio investments and direct loans, contributed $2.55bn, representing 98.08% of the total inflows.

This preference for loans over equity investments reflects investor caution, with foreign investors opting for safer financial instruments rather than committing to long-term projects. The reliance on foreign currency loans highlights the ongoing trend where short-term investments and debt instruments dominate Nigeria’s capital importation landscape.

While these inflows can provide immediate liquidity to the economy, they do not offer the same level of stability or growth potential as direct investments into physical assets or infrastructure. Again, in Q2 2024, Nigeria experienced a significant decrease in both portfolio investments and foreign currency loans.

Portfolio investments for Q2 2024 stood at $1.40bn, marking a sharp decline of 74.97% from $5.60bn recorded in the preceding quarter, and a 65.33 per cent drop compared to the $4.05bn reported in Q2 2023.

Similarly, foreign loans, which constitute a substantial portion of Nigeria’s capital importation, recorded an inflow of $1.15bn in Q2 2024, reflecting a 74.98% decrease from $4.60bn in Q1 2024.

When compared to the same period in the previous year, where loans amounted to $3.32bn in Q2 2023, the decline was 65.33% Meanwhile, Nigeria’s capital importation of $2.60bn represented an increase of 152.81% year-on-year compared to $1.03bn in Q2 2023.

Despite this annual growth, the figure marks a decline of 22.85 % from the $3.38bn recorded in the first quarter of 2024.The decrease in quarterly figures highlights ongoing fluctuations in investor sentiment, reflecting global economic uncertainties and domestic challenges.

The report read. “In Q2 2024, total capital importation into Nigeria stood at $2,604.50m, higher than $1,030.21m recorded in Q2 2023, indicating an increase of 152.81%t. In comparison to the preceding quarter, capital importation declined by 22.85% from $3,376.01m in Q1 2024.”

Portfolio investments emerged as the primary driver of the capital inflows, contributing $1.40bn, or 53.93% of the total. These investments often involve foreign investors injecting capital into Nigeria’s stocks, bonds, and other financial instruments, aiming for quick returns.

Meanwhile, other investments, which include loans and trade credits, followed with $1.17bn, accounting for 44.92% of the total inflows. The banking sector was the largest beneficiary of capital importation, receiving $1.12bn, representing 43.15% of total inflows in the quarter. This sector’s dominance highlights the crucial role of banks as conduits for foreign investments, facilitating access to Nigeria’s financial markets.

Following the banking sector, the production/manufacturing sector attracted $624.71m, which constituted 23.99% of the total. The trading sector also saw significant capital inflows, amounting to $569.22m (21.86 %), reflecting the resilience of trade activities in the country.

It was also observed that only Lagos, Ekiti, and Abuja recorded inflows of foreign capital in the second quarter of 2024. On a geographic basis, Lagos State maintained its position as the leading destination for capital importation, attracting $1.37bn, or 52.52% of total inflows.

Lagos remains the commercial hub of Nigeria, offering a strategic entry point for foreign investors due to its robust infrastructure and dynamic business environment. Abuja (FCT) followed closely, receiving $1.24bn, which accounted for 47.48% of the total.

In contrast, Ekiti State recorded minimal capital inflows, with just $0.0003m during the quarter, indicating the concentration of investment in more established economic centers.

Although the Bureau did not state the reason for the increase, however, inflation rate has been on a rising trajectory in recent months, hitting as high as 34% before dropping slightly to 32.15% in August from 33.40% ce in July of 2024.

The NBS report ‘Liquefied Petroleum Gas (Cooking Gas) Price Watch August 2024’, said the average retail price for refilling a 12.5kg cylinder of cooking gas increased by 9.05 per cent on a month-on-month basis from ₦14,261 in July 2024 to ₦15,552 in August 2024.

On state profile analysis, Rivers recorded the highest average retail price for the refilling of a 12.5kg cylinder with ₦17,086. Followed by Cross River with ₦17,050 and Abia with ₦17,012.

On a year-on-year basis, this increased by 56.25 per cent from ₦4,115 in August 2023.

On state profile analysis, Benue and Sokoto recorded the highest average price for refilling a 5kg cylinder with ₦7,000, followed by Rivers with ₦6,954, and Borno with ₦6,914.

On the other hand, Taraba recorded the lowest price with ₦5,600 followed by Abuja and Kogi with ₦5,825 and ₦5,857 respectively.

In addition, analysis by zone showed that the South-East recorded the highest average retail price for refilling a 5kg cylinder with ₦6,585, followed by the South-South with ₦6,451 while the North-Central recorded the lowest with ₦6,344.

Conversely, the lowest average price was recorded in Bauchi with ₦13,425, followed by Nassarawa and Adamawa with ₦13,641 and ₦13,725 respectively.

Analysis by zone showed that the South-South recorded the highest average retail price for refilling a 12.5kg cylinder with ₦16,524, followed by the South-East with ₦16,496 while the North-Central recorded the lowest price with ₦14,767.

The NBS report showed that the agricultural sector contributed the highest company income tax in Q2, showing a remarkable 474.50% increase from the previous quarter.

“On a quarter-on-quarter basis, agriculture, forestry, and fishing recorded the highest growth rate with 474.50%, followed by financial and insurance activities and manufacturing with 429.76% and 414.15%, respectively,” the report said.

“On the other hand, activities of households as employers, undifferentiated goods- and services-producing activities of households for own use, had the lowest growth rate with -30.22%, followed by activities of extraterritorial organizations and bodies with -15.67%,” NBS said.

Meanwhile, Tax payments from local companies in Nigeria saw a massive 249.2 percent jump in the second quarter (Q2) of 2024, according to the latest company income tax (CIT) report by the National Bureau of Statistics (NBS).

The CIT, also known as corporate tax, is levied on the profits made by companies operating in Nigeria. It is regulated by the Companies Income Tax Act (CITA) and enforced by the Federal Inland Revenue Service (FIRS).

Currently, the tax is charged at 30 percent for companies with more than N100 million in turnover, and 20 percent for companies with a turnover ranging between N25 million and N100 million.

From 2015 to 2024, the country amassed a total of N20.68 trillion in corporate taxes.  In 2015, the federal government collected N1.38 trillion in corporate taxes, however, in 2016, the revenue decreased to N1.02 trillion.

The decline halted in 2017, as the CIT collected by the government climbed to N1.24 trillion. The upward trend continued, with N1.42 trillion CIT collected in 2018 and N1.63 trillion in 2019.

However, it declined to N1.41 trillion in 2020 but increased to N1.69 trillion in 2021.The growth continued in 2022, with collection reaching N2.83 trillion, climbing further to N4.89 trillion in 2023.

Further analysis showed that over the past decade — excluding 2015 — local companies have paid more CIT than foreign firms operating in Nigeria.

In 2015, local companies paid N645.68 billion in corporate tax, while foreign firms contributed N715.52 billion. However, in 2016, local payments surpassed that of foreign firms, as the former paid N620.78 billion, while CIT from the latter was N360.23 billion.

This trend continued in 2017, with local companies paying CIT of N666.79 billion, compared to the N489.90 billion paid by foreign firms. In 2018, CIT from local and foreign firms amounted to N709.94 billion and N534.96 billion, respectively.

The amount increased in 2019, as the government collected N813.17 billion from local firms and N615.52 billion from foreign firms.

By 2020, payments from both local and foreign firms decreased to N628.58 billion and N317.25 billion, respectively. However, in 2021, company income tax collected from local firms crossed the N1 trillion mark, reaching N1.10 trillion, while foreign firms paid N527.62 billion.

In 2022, local and foreign firms CIT rose to N1.68 trillion and N1.15 trillion, respectively. But  by 2023, both local and foreign firms’ CIT had surpassed N2 trillion, with local firms paying company income tax of N2.51 trillion and foreign firms parting with N2.39 trillion.

Although 2024 data only covers the first half of the year, the current payments of N1.74 trillion for local firms and N1.72 trillion for foreign firms indicate an upward trend for the remainder of the year.