Foreign Transactions on NGX Reach Record N2.03tn

Nigeria’s capital market has recorded an extraordinary milestone as foreign participation on the Nigerian Exchange (NGX) surged to an unprecedented N2.03 trillion, marking one of the strongest inflows the local bourse has witnessed in more than a decade. The figure reflects a renewed appetite by global investors for Nigerian securities following recent macroeconomic reforms, improving market confidence, and widening opportunities within key sectors listed on the exchange.

According to recently released trading data, the N2.03 trillion foreign transactions accumulated between January and the most recent trading month, signalling a dramatic rebound from previous years when foreign outflows overshadowed inflows due to heightened economic uncertainty. Market analysts note that this surge signals not only a strengthening of investor sentiment but also a shift in portfolio reallocation strategies among offshore investors seeking high-performing emerging markets with favourable long-term growth prospects.

One of the major drivers of this sharp increase is Nigeria’s improving macroeconomic environment. Reforms in the foreign exchange market, including moves toward a more transparent and flexible FX system, have addressed long-standing liquidity concerns that previously discouraged foreign investors. As access to forex improves and currency distortions ease, portfolio investors are regaining confidence in the stability and predictability of the Nigerian market.

In addition, the NGX has continued to witness robust corporate performances across banking, consumer goods, industrials, and energy sectors. Many listed companies have posted strong half-year and third-quarter results, with several banks reporting higher earnings due to improved interest margins and FX revaluation gains. The resilience and profitability of these companies provide attractive entry points for foreign investors searching for value in undervalued or rapidly expanding markets.

Another key factor fuelling the strong foreign participation is the implementation of technology-driven initiatives by the NGX. The exchange has intensified efforts to enhance transparency, automate trading processes, and provide real-time access to market information. These steps have made it easier and faster for international investors to participate in the Nigerian market. Market operators also believe that the introduction of new asset classes, improved corporate governance frameworks, and expanded investor education programmes have contributed significantly to the rising foreign interest.

Beyond equities, foreign investors have also shown increased activity in fixed-income instruments, particularly as yields on Nigerian government securities remain attractive when compared with global averages. The combination of high-yield bonds and a recovering equity market has positioned Nigeria as a compelling investment destination despite global economic headwinds.

The NGX, while celebrating the milestone, emphasised that sustaining this momentum will require continued policy stability, supportive regulatory frameworks, and ongoing efforts to deepen the capital market. The exchange noted that a more diversified market — including derivatives, commodities, and digital financial products — will help attract an even wider range of global investors.

However, analysts caution that challenges persist. Inflation, though moderating, remains high, and exchange-rate volatility could re-emerge if forex liquidity weakens. There are also concerns about interest rate decisions by major global economies, which could redirect capital flows if yields elsewhere become more competitive. Despite these risks, the current trajectory suggests growing international confidence in Nigeria’s reform agenda.

Local investors, too, are responding to the increased foreign participation. Historically, when foreign investors show strong interest, domestic investors often follow suit, driven by positive market sentiment. The N2.03 trillion milestone has already begun to stimulate higher trading volumes and greater liquidity, which in turn lowers transaction costs and enhances market efficiency.

Manufacturers, banks, tech firms, and energy companies listed on the NGX are also expected to benefit from the elevated foreign capital inflow. Increased liquidity generally leads to better price discovery, higher market capitalization, and improved access to capital for expansion projects. For companies planning public offerings or rights issues, this renewed foreign appetite could improve subscription levels and reduce fundraising risks.

Looking ahead, analysts project that foreign investment in the Nigerian market could rise further if the government sustains reforms, enhances macroeconomic stability, and strengthens investor protection measures. The growing interest coincides with Nigeria’s push to attract foreign direct and portfolio investment to boost economic growth, expand industrial output, and diversify revenue sources.

In the broader context, the new foreign trade record marks a significant shift from the prolonged dip in participation recorded in previous years. It signals not only a recovery but also a fresh vote of confidence in Nigeria’s economic direction. The NGX milestone underscores the country’s potential to re-establish itself as one of Africa’s most attractive investment hubs.

 

As the year progresses, the performance of the Nigerian capital market will be closely watched by both local and global stakeholders. Should the positive trend continue, Nigeria’s capital market could experience one of its strongest growth phases in recent times, driven largely by foreign investor participation that has now entered record territory.