Foreign Investors Take Profit Rather Than Stay Invested in Nigeria -AAG
Nigeria is increasingly becoming a case study for quick returns for foreign investors, according to AAG Capital Limited. In its latest update, the firm referenced recent foreign portfolio investment data for March 2026, published by the Nigerian Exchange.
AAG Capital said, “At first glance, it seems that foreign investors are returning, as Nigeria recorded a high of N288.82 billion in foreign portfolio investment.
“This represents a significant increase from N139.03 billion in February and N114.14 billion in January. However, a closer look reveals a much less stable situation”
The investment firm said in 2023 and 2024, the pattern was clear: foreign investors were pulling out funds and not looking back. Inflows were minimal, while outflows were increasing substantially. Month after month, more money left the market than entered it.
The investment firm cited that Nigeria received N174.80 billion in foreign investment while repatriating N235.82 billion in 2023 alone, and faced net outflows of N455.62 billion after an inflow of N396.41 billion in 2024.
These highlighted serious issues related to foreign exchange (FX) management, AAG Capital noted. However, a change occurred in 2025.
The liberalisation of the FX market, commitment to clearing the FX backlog, and improved transparency indicated a more market-oriented policy from the Central Bank of Nigeria.
Analysts acknowledged that this shift aligned well with foreign investors, leading to renewed interest in the market. By the end of 2025, foreign investments totalled N2.65 trillion.
Notably, much of this inflow occurred in March, peaking at N349.97 billion, followed by N325.46 billion in September of the same year.
The firm said that while the figures appeared rosy at first, the reality was that funds frequently left the country quickly, as investors pursued short-term opportunities rather than making long-term commitments.
In March, when the highest recorded inflow was achieved, a corresponding N349.92 billion was withdrawn, leaving only N50 million on the table.
Currently, AAG Capital is observing a similar trend reemerging this year. Once again, month after month, more money is exiting the market. “When we account for the inflows and outflows, it becomes evident that we are losing more than we retain from foreign investors,” the firm stated.
Net outflows reached N74.72 billion in March 2026, increasing from N18.42 billion in January 2026. This suggests that investors are taking profits rather than maintaining their investments.
“We believe concerns regarding Nigeria’s ability to manage its economy amid ongoing geopolitical tensions are significant deterrents. However, not all the data is negative.”
Nigeria’s total investment portfolio is growing, with domestic players leading the charge. In March, the total investment portfolio reached N1.74 trillion, of which N1.46 trillion came from domestic participants, with retail investors accounting for 63% of the investment pool.
“It is our opinion that if Nigeria can demonstrate fiscal discipline, achieve a positive balance of payments, and maintain credible FX liquidity buffers, we may witness a more structurally driven recovery in the future,” AAG Capital Limited concluded.
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