Foreign investors reluctant to implement $30bn investment pledges – PEVCA

• Published On: 18 August 2024 at 16:29

The Private Equity and Venture Capital Association of Nigeria has stated that international investors are hesitant to carry out the over $30 billion in investment pledges made in the country due to the volatility of Nigeria's foreign exchange market.

According to Nairametrics, the group made this statement in its mid-year review and strategic outlook for the country, which examined the private investment landscape and factors influencing sector trends.

The group claimed that issues with foreign currency repatriation have exacerbated investment risk in the country by undermining private sector investments through lower private sector consumption and higher levels of inflation, citing the FMCG sector as an example.

It went on to say that only a certain type of investor finds quick investments appealing because they involve significant risk, such as difficulties in getting foreign exchange out of the nation.

With strong long-term plans, political connections, or a high risk tolerance.

However, it should be noted that this group is in the minority and relatively small.

According to the report, "Minister of Trade and Investments, Doris UzokaAnite, highlighted in February this year that direct engagements with foreign investors have resulted in significant interest and commitments totalling USD 30 billion since Tinubu's inauguration."

"Despite these commitments, actual investments have yet to materialise due to investor apprehension over the forex market's instability."

It clarified that the delay in executing the $30 billion investment pledges creates a vicious loop of sluggish investor activity, reducing the likelihood of a market recovery.

Remember, the Minister of Industry, Trade, and Investment, Dr. Doris Uzoka-Anite, revealed earlier this year that Nigeria had received pledges of about $30 billion in investments from various companies.