Sector attracts just 2.76% of $16.78bn capital importation in 9M 2025, as industry leaders blame FX volatility, high costs and policy uncertainty……
Capital inflows into Nigeria’s manufacturing sector plunged sharply in the first nine months of 2025, even as overall foreign capital entering the country more than doubled, new figures from the National Bureau of Statistics (NBS) reveal.
According to the data, capital importation into production and manufacturing stood at $463.52 million between January and September 2025 (9M’25), marking a steep 54.11 percent drop from the $1.01 billion recorded during the same period in 2024 (9M’24).
The contraction is even more striking when viewed against total capital inflows into the economy.
Overall capital importation surged by 131.96 percent year-on-year to $16.78 billion in 9M’25, up from $7.23 billion in the corresponding period of 2024.
Manufacturing’s Share Shrinks Dramatically
The data indicates that manufacturing accounted for just 2.76 percent of total capital importation in 9M’25, a sharp fall from approximately 13.97 percent in 9M’24.
This represents a significant erosion of the sector’s share of foreign investment, despite the broader rebound in investor appetite for Nigerian assets.
Analysts say the divergence highlights a growing imbalance between capital flowing into financial instruments and short-term opportunities versus long-term investments in the real economy.
Mixed Quarterly Performance
A breakdown of the 2025 figures shows uneven momentum across quarters.
- Q1 2025: $129.92 million
- Q2 2025: $72.25 million
- Q3 2025: $261.35 million
While inflows rebounded strongly in the third quarter, bringing the cumulative total to $463.52 million, the figure still trails far behind 2024 levels.
In comparison, manufacturing attracted:
- $191.92 million in Q1 2024
- $624.71 million in Q2 2024
- $189.22 million in Q3 2024
These stronger quarterly performances pushed the nine-month total for 2024 above the $1 billion mark.
Meanwhile, total capital importation into Nigeria in Q3 2025 alone climbed to $6.01 billion, a 380.16 percent increase compared to $1.25 billion recorded in Q3 2024, and a 17.46 percent rise over Q2 2025.
Industry Raises Red Flags
Reacting to the figures, Director General of the Manufacturing Association of Nigeria (MAN), Segun Ajayi-Kadir, said persistent structural challenges are deterring long-term investment in the sector.
“The Nigerian manufacturing ecosystem is not encouraging for investment due to persistent headwinds,” he stated.
According to him, foreign investors are increasingly cautious about committing to large-scale production projects due to high operating costs, macroeconomic instability, infrastructure gaps, double-digit interest rates and weak market linkages.
He further cited foreign exchange volatility, sustained inflationary pressure, rising input costs, unreliable electricity supply, poor transport infrastructure, port inefficiencies, policy inconsistency, regulatory uncertainty and security concerns as major constraints limiting expansion and fresh investment.
Broader Economic Implications
The widening gap between overall capital importation and inflows into manufacturing raises concerns about Nigeria’s industrialisation ambitions.
With manufacturing playing a critical role in job creation, value addition and economic diversification, the sharp decline in its share of foreign capital could have long-term implications for growth and competitiveness.
While investors appear increasingly willing to deploy funds into Nigerian assets, the real sector particularly manufacturing may need deeper structural reforms to regain its appeal and attract sustained foreign direct investment.
About the Author
