Foreign Portfolio Investors (FPIs) traded a total of ₦996.03 billion worth of Nigerian equities in the first five months of 2025, more than double the ₦458.29 billion recorded in the same period of 2024.
The data highlights a sharp resurgence in foreign investor confidence amid relative foreign exchange stability and improving macroeconomic conditions.
The ₦996.03 billion in foreign transactions represents 29.17 percent of the total value of equities traded on the NGX between January and May 2025. The increase in foreign participation underscores the renewed appeal of Nigerian assets as fiscal and monetary reforms begin to restore credibility to the investment climate.
Analysts attribute the growth in FPI activity to improved access to foreign exchange, policy clarity, and the ongoing liberalisation of the forex market.
The Central Bank of Nigeria (CBN) had implemented a series of measures in late 2024 and early 2025 aimed at unifying exchange rates, reducing volatility, and improving transparency—key issues that previously deterred foreign investors.
“This level of activity by FPIs signals a strong vote of confidence in Nigeria’s reform agenda and macroeconomic direction,” a Lagos-based equities analyst told Naijaonpoint. “Stable exchange rates, ongoing market liberalisation, and rising corporate earnings have restored competitiveness in local equity valuations.”
Foreign participation in the Nigerian equities market had slumped in prior years due to prolonged foreign exchange illiquidity, policy uncertainty, and repatriation risks. However, with the Federal Government’s recent fiscal reforms—such as the removal of fuel subsidies, exchange rate unification, and investor-focused regulatory adjustments—foreign inflows are rebounding.
The development also comes amid continued interest rate hikes by global central banks, including the U.S. Federal Reserve. Despite tighter global liquidity conditions, Nigeria appears to be attracting more risk-tolerant investors seeking exposure to high-growth frontier markets with undervalued assets.
According to the NGX, domestic investors still account for the majority of activity, but the steep rise in foreign portfolio flows within just five months points to increasing global interest in Nigeria’s capital markets.
The equity market has witnessed increased buying in sectors such as banking, fast-moving consumer goods (FMCG), telecommunications and industrials.
Market operators say sustaining the momentum will depend on further progress in policy consistency, macroeconomic stability, and ease of capital repatriation. They also stress the need for deeper reforms in corporate governance, tax policy and infrastructure to consolidate gains.
The NGX has continued efforts to attract more institutional investors, including foreign asset managers, through enhanced disclosures, new product offerings and ESG-compliant instruments.
The Exchange is also expected to ramp up engagement ahead of Nigeria’s anticipated Eurobond issuance and planned privatisation programs, which may open additional investment windows.
With ₦996.03 billion already recorded by FPIs in just five months, 2025 is on track to set a multi-year record in foreign equity participation—reversing the outflow trend of recent years and reinforcing Nigeria’s place on the radar of global fund managers.
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