Nigeria attracted about $4 billion in foreign direct investment (FDI) in 2025,
more than double the $1.6 billion recorded in 2024, driven largely by major oil
and gas project financing deals, a report by the United Nations Conference on
Trade and Development said.
According to the World Investment Report 2026, titled ‘International
Investment in a Turbulent Era’, which tracks global cross-border investment
trends, Nigeria’s improved inflows are mainly due to oil and gas-related
international project finance (IPF) deals, including a single transaction valued at
about $2 billion.
The report also highlighted significant cross-border mergers and acquisitions
completed during the year, including the acquisition of Shell’s onshore oil
assets by Renaissance Africa Energy and the purchase of Lafarge Africa Plc by
Huaxin Cement.
Nigeria also ranked among the leading African destinations for large-scale
investment projects, alongside Algeria, Namibia, South Africa and Ethiopia,
attracting investments in hydrocarbons, refining, battery storage and industrial
production.
The report further showed that Nigerian companies expanded their overseas
investments during the year. FDI outflows almost tripled to about $1.2 billion in
2025 from approximately $408 million in 2024.
UNCTAD‘s data also indicated that Nigeria’s inward FDI stock, a measure of
the cumulative value of foreign investment in the country, climbed to about
$92.9 billion in 2025, from $86.2 billion in 2024. Outward FDI stock,
representing Nigerian investments abroad, rose to about $18.5 billion from
$17.6 billion over the same period.
Nigeria’s performance helped lift West Africa’s overall FDI inflows by 44 per
cent, to about $19.6 billion in 2025, making it one of only two African sub-
regions, alongside East Africa, to record growth during the year. Southern and
Central Africa each declined by 21 per cent, while North Africa fell by 56 per
cent following an exceptional 2024 driven by a single Egyptian megaproject.
Overall, FDI inflows into Africa dropped by 26 per cent, from about $94 billion
in 2024 to $70 billion in 2025. Despite the decline, the report noted that the
number of announced greenfield investment projects increased, signalling a
shift away from megaproject-driven investment towards a broader pipeline of
smaller projects, although the 10 largest projects still accounted for about 40 per
cent of total announced greenfield investment value.
UNCTAD also recently implemented policy reforms aimed at strengthening
Nigeria’s investment climate. According to the report, Nigeria introduced a 15
per cent minimum effective tax rate for multinational enterprises with annual
revenues above €750 million, aligning with the Organisation for Economic Co-
operation and Development Global Anti-Base Erosion framework.
The report added that Nigeria and Cameroon have replaced broad tax
exemptions with tiered tax credits linked to job creation, local value addition
and investments in priority sectors.
It also cited Nigeria’s introduction of performance-based tax credits for
upstream petroleum companies, with fiscal incentives tied to cost efficiency.
On innovation, UNCTAD pointed to Nigeria’s Nigeria Startup Act and related
central bank regulatory frameworks as examples of regulatory sandboxes that
allow start-ups to test products under controlled conditions before full
regulatory compliance, helping reduce uncertainty for innovative businesses.
Globally, FDI rose by 6 per cent to $1.6 trillion in 2025, following two
consecutive years of decline, the report said. However, it noted that the growth
masked underlying fragility, as it was driven largely by a small number of
megaprojects, particularly artificial intelligence-related infrastructure, while
new project activity remained subdued across most sectors.
According to the report, FDI inflows into developed economies rose by 11 per
cent to $723 billion, while developing economies recorded a modest two per
cent increase to about $901 billion.
UNCTAD added that FDI remained the largest source of external financing for
developing countries in 2025, accounting for about half of total external
financial inflows, ahead of remittances, official development assistance and
portfolio investment.