Foreign Investors’ Transactions Surge 113% to N1.14tn in First Half of 2025

Foreign portfolio investment (FPI) in the Nigerian capital market rose sharply in the first half of 2025, with total transactions from foreign investors hitting ₦1.14 trillion, representing a 113 percent increase compared to the same period in 2024.

Data from the Nigerian Exchange Limited (NGX) showed that the surge was driven by renewed investor confidence, improved foreign exchange market reforms, and a more stable macroeconomic environment. The increase marks one of the strongest half-year performances for foreign inflows into Nigerian equities in recent years.

According to the NGX’s Domestic and Foreign Portfolio Investment Report, foreign investors accounted for a significant portion of overall market activity between January and June 2025, with both inflows and outflows recording notable growth. Inflows rose as international fund managers took positions in banking, energy, and consumer goods stocks, while outflows also increased due to portfolio rebalancing and profit-taking.

Market analysts attributed the positive momentum to recent policy changes by the Federal Government and the Central Bank of Nigeria (CBN), particularly the liberalisation of the foreign exchange market and measures aimed at improving liquidity. The reforms, they said, have reduced currency conversion bottlenecks, making it easier for foreign investors to move funds in and out of the country.

They also pointed to the relative stability of the naira in the second quarter of 2025, which helped reduce currency risk concerns for offshore investors. The combination of attractive equity valuations and improved ease of repatriation, analysts noted, played a major role in boosting market sentiment.

On the domestic side, local investors remained dominant in market participation, but the strong return of foreign players injected fresh capital into the system and contributed to higher trading volumes. The NGX report revealed that total market transactions—both domestic and foreign—crossed the ₦2 trillion mark in the first half of the year.

The Chief Executive Officer of NGX, Temi Popoola, welcomed the development, stating that the market is beginning to reap the benefits of recent structural reforms. He expressed optimism that if policy consistency is maintained, foreign participation could rise further in the second half of 2025.

Despite the impressive performance, some experts cautioned that global market conditions, including interest rate policies in advanced economies, geopolitical tensions, and commodity price fluctuations, could influence the flow of foreign capital into emerging markets like Nigeria in the coming months.

They advised that to sustain the momentum, Nigeria must continue to address structural challenges such as infrastructure deficits, regulatory bottlenecks, and security concerns, while ensuring that ongoing economic reforms are not reversed.

The NGX also emphasised its commitment to deepening the market by attracting more listings, enhancing transparency, and expanding product offerings, including derivatives and Exchange-Traded Funds (ETFs), to appeal to a broader range of global investors.

As the second half of 2025 unfolds, stakeholders remain watchful of both domestic economic indicators and external market forces that could influence investment decisions. Nonetheless, the 113 percent rise in foreign investor transactions is being seen as a strong vote of confidence in Nigeria’s capital market recovery trajectory.

In addition, market stakeholders are optimistic that Nigeria’s recent push for digital transformation in capital market operations will further improve accessibility and efficiency for both local and foreign participants. Initiatives such as e-dividend mandates, remote account opening, and real-time trading platforms are expected to make participation easier and enhance investor confidence.

Looking ahead, analysts believe that if the current reform momentum is sustained, Nigeria could position itself as one of Africa’s top investment destinations in the coming years. With strategic policy alignment, improved ease of doing business, and consistent macroeconomic stability, the country’s capital market may attract even greater levels of foreign portfolio investments, reinforcing its role as a key driver of economic growth.