Foreign Investment in Nigeria’s Trade Sector Jumps 91% to $65.8m as Commerce Leads GDP Growth

Nigeria’s trade sector attracted $65.79 million in foreign capital during the first quarter of 2026, marking a 91.31 per cent increase from the $34.39 million recorded in the corresponding period of 2025, according to the latest capital importation data released by the National Bureau of Statistics.

The significant year-on-year growth highlights renewed investor confidence in Nigeria’s commercial and cross-border trade activities, even as inflows moderated from the stronger performances recorded in the second half of last year.

Data from the NBS showed that while foreign investment into the sector rose sharply compared to the previous year, it fell short of the $80.94 million attracted in the third quarter of 2025 and the $119.21 million recorded in the fourth quarter of 2025, suggesting a slowdown in momentum after two consecutive quarters of robust growth.

The development comes as trade emerged as the largest contributor to Nigeria’s Gross Domestic Product in the first quarter of 2026, accounting for 17.89 per cent of total economic output.

Commenting on the development, the Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Muda Yusuf, said the sector’s strong performance reflected improvements in the broader economic environment.

“One of the most significant highlights of the report is the emergence of the trade sector as the single largest contributor to GDP at 17.89 per cent. This reflects the positive effects of improved exchange rate stability, better FX liquidity conditions, easing inflationary pressures and recovering business confidence on commercial activities and trade flows,” he said.

Yusuf, however, warned that trade alone cannot sustain long-term economic transformation.

“Long-term growth resilience requires stronger productive capacity, deeper industrialisation and significantly higher domestic value addition,” he added.

Industry stakeholders also projected that trade would become an even stronger driver of growth across Africa as countries deepen regional integration under the African Continental Free Trade Area framework.

The Chief Executive Officer of Seedtree Capital, Bowale Adeoye, said innovations in trade finance and logistics are reshaping commerce across the continent.

“Trade finance innovation is reshaping intra-African commerce. The shift from dollar-intermediated systems toward continental payment infrastructure is reducing transaction costs and settlement delays while addressing Africa’s $100–120 billion trade finance gap,” she said.

Adeoye noted that platforms such as the Pan-African Payment and Settlement System are enabling businesses to settle transactions more quickly in local currencies, improving liquidity and reducing trading costs.

She also identified cold-chain logistics as a growing pillar of Africa’s trade ecosystem, particularly in food and pharmaceutical supply chains.

According to her, local value addition has become critical for competitiveness, supply-chain resilience and tariff optimisation in African economies.

Similarly, the Chief Executive Officer of NAHCO Commodities Limited, Ijeoma Ezenwa, said the continent’s agricultural sector is increasingly focusing on value-added processing rather than exporting raw commodities.

She stressed that market access is now being determined by quality assurance, traceability and compliance with international standards rather than production volumes alone.

Meanwhile, the Federal Government has identified trade facilitation as a key component of its economic agenda for 2026.

The Minister of Industry, Trade and Investment, Jumoke Oduwole, said the ministry would prioritise unlocking regional and global demand through trade facilitation, investment mobilisation, export development and digital infrastructure.

Key initiatives include a Made-in-Nigeria campaign, industrial cluster development, support for women-owned enterprises, revitalisation of the cotton, textile and garment industry, as well as the deployment of artificial intelligence and digital governance tools.

The ministry’s Permanent Secretary, Nura Rimi, said efforts had been intensified to improve policy implementation, institutional coordination and operational efficiency across government agencies.

The broader NBS capital importation report revealed that total foreign capital inflows into Nigeria rose to $10.37 billion in the first quarter of 2026, up from $5.64 billion in the same period of 2025. Portfolio investments accounted for the largest share of inflows, while foreign direct investment stood at $135.08 million.

Analysts believe that rising investor interest in the trade sector, coupled with ongoing reforms, regional integration efforts and digital trade initiatives, could strengthen Nigeria’s position as one of Africa’s leading commercial hubs in the years ahead.