Foreign Direct Investments (FDI) in Nigeria has reached a record N800 billion in January this year.
This comes as prominent corporations from the United States of America, Canada, The Netherlands and Turkey increased their investment stakes in the country, in a pace never seen before.
The Central Bank of Nigeria’s figures for third quarter of last year showed that a total of $1.4 billion was injected into the economy through FDI while $4.6 billion came in through portfolio investments, with another $4.7 billion invested in the nation’s capital market.
The current inflows and investment commitments with different gestation periods focus on infrastructure development, construction of power plants for the enhancement of electricity generation, mining, healthcare, agriculture and agro-allied sectors of the Nigerian economy.
A weaker naira will make Nigeria more competitive globally and increase foreign investment into the country.
This is according to a financial analyst and former Vice-President Investments, Merrill lynch, Mr Kenneth Iwelumo.
Mr Iwelumo acknowledged that, although Nigeria’s dependence on imports will make this a challenge, he called on the Central Bank of Nigeria (CBN) and the federal government to find a middle ground.
The financial expert made this known on our morning breakfast programme, ‘Business Morning’, saying “a weak Naira will encourage Foreign Direct Investments (FDI) into the country while a strong Naira will discourage FDI flows to the country.”
He further explained that President Jonathan’s job and wealth creation needs funding flows for technological and industrial development and a weak Naira will enable this.
“A weak Naira will make Nigeria competitive globally and it will encourage investments to come in while a stronger Naira will only encourage Nigerians to take their money out of the country.
He therefore urged the CBN to find the middle ground.