TechPression

Tag: Foreign direct investment

  • Telecoms industry generates $191 FDI as government plans reforms

    Telecoms industry generates $191 FDI as government plans reforms

    The Federal Government of Nigeria, in response to an unprecedented $191 million Foreign Direct Investment in the first quarter of 2024, has declared plans to carry out changes in the telecom industry.

    The National Bureau of Statistics data on capital imports released last week showed that this investment exceeded the total Foreign Direct Investment (FDI) for the entire year 2023.

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    The position of the Minister

    Bosun Tijani, the Minister of Communications and Digital Economy, expressed hope for maintaining this momentum and said the government’s policies would be aimed at promoting equitable growth in both the digital sector and the overall economy.

    In a statement obtained on Monday, the minister stated, “As we start the second half of the year, I’m looking forward to building on this momentum, supported by the necessary reforms and policies that President Bola Tinubu is putting in place to stimulate inclusive growth in the digital economy and the broader economy.”

    The minister stated that the telecom industry, a longtime foundation of the nation’s economic development, was spurring growth and advancing the nation.

    He credited the sector’s potential and the diligent efforts of ICT stakeholders for the progress.

    “We believe that our sector has the potential to grow, and this increase in FDI is a testament to the hard work that all ICT stakeholders have put in to ensure that we reverse the slowdown in our sector and keep it as a catalyst for growth,” Tijani said.

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    Challenges faced by the telecoms industry 

    Nevertheless, the industry has difficulties that have deterred new investment, such as double taxation and volatility in the foreign exchange market.

    Experts contend that in order to maintain the sector’s growth and draw in additional Foreign Direct Investment, the government must resolve these problems and improve the investment climate.

    The Nigerian government received N2.4 trillion in tax payments from telcos in 2023, as the Groupe Special Mobile Association reported.

    Based on user base, the two largest operators reported losses in their respective financial reports.

    MTN Nigeria lost N137 billion in 2023, while Airtel lost $151 million in the first quarter of 2024.

    Tony Emoekpere, the president of the Association of Telecommunications Companies of Nigeria, warned that operators would not make it until the end of the year if the current economic crisis continues.

    In April, the ATCON CEO revealed to the media that “Telcos have been running at a loss, even though they may be reluctant to disclose.”

  • Clean technology leads foreign direct Investment into Africa

    Clean technology leads foreign direct Investment into Africa

    Advisory and professional services firm, EY, recently published its eleventh Africa Attractiveness Report, revealing that clean technology has taken the lead in foreign direct investment (FDI) into Africa.

    This development comes against the backdrop of a substantial overall recovery of FDI across the continent. Here’s an overview of the key findings:

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    Clean Technology Takes the Top Spot

    EY’s Africa Attractiveness Report found that clean technology emerged as the leading sector in attracting foreign direct investment in Africa. The continent is experiencing a green revolution, which is driving FDI into clean technology. This sector is crucial for Africa’s sustainable development.

    Following clean technology, technology services secured the second-highest amount of FDI, while business services ranked third in terms of investment attractiveness. This demonstrates that technology and innovation are critical drivers of economic growth in Africa.

    The overall report noted a remarkable increase in foreign direct investment in Africa. The continent attracted 733 projects, marking a 64% surge from the previous year. These projects were valued at $194 billion and played a pivotal role in creating job opportunities. In total, these FDI projects generated 154,000 jobs across Africa.

    Africa’s Renewable Energy Potential

    According to EY partner and Africa region government and infrastructure leader Sandile Hlophe, “Clean technology FDI is being driven by a green revolution sweeping across Africa.” While Africa is making progress in harnessing renewable energy, fossil fuels continue to dominate the continent’s power generation. South Africa, Egypt, Morocco, and Kenya account for nearly 75% of all renewable energy investments in Africa since 2010, totaling $46 billion.

    Additionally, the International Renewable Energy Agency (Irena) and the African Development Bank (AfDB) estimate Africa’s renewable energy potential to be substantial, with solar photovoltaic, hydropower, and wind energy capacities reaching thousands of gigawatts.

    South Africa Leads in FDI Projects

    South Africa emerged as the top destination for foreign direct investment projects in Africa, representing 23% of the continent’s total with 157 projects. This marks the highest number since 2016. These projects brought an estimated $26.8 billion in FDI and generated approximately 15,000 jobs. South Africa also ranked as the third-largest recipient of clean technology FDI in Africa, following Egypt and Morocco.

    The energy crisis in South Africa has expedited the shift away from the national grid, emphasizing the need for alternative energy sources. The EY report predicts that South Africa will increase its share of renewable energy to 41% by 2030.

    Foreign Investors in Africa

    The largest sources of foreign direct investment in Africa were the United States and the United Kingdom, followed by Switzerland and Germany. The United Arab Emirates (UAE) has also increased its presence by investing in capital-intensive clean technology projects worth $50 billion, accounting for three-quarters of its total investments in the region. This FDI from the UAE resulted in the creation of 3,000 jobs in the country.

    EY’s Sandile Hlophe explained, “Business services, along with technology, dominate South Africa’s FDI, with the real estate sector generating the most capital and employment.”

    Continued Growth in North and Southern Africa

    The report highlighted that FDI in Africa experienced a substantial decline in 2020, making it the hardest-hit region globally. However, the continent has since rebounded, particularly within the North and Southern African regions.

    Hlophe noted, “North Africa attracted more FDI than any other region in Africa, led by Egypt. North Africa attracted the most investment projects, with record capital investment of $130 billion, creating 89,000 jobs.”

    In Southern Africa, Zimbabwe attracted $5.2 billion in FDI, and Zambia received $1.7 billion in foreign direct investment. These investments are critical for the economic development of these nations.

    Foreign direct investment, particularly in clean technology and technology services, plays a pivotal role in Africa’s sustainable development and economic growth. The continent’s increasing focus on renewable energy and the contributions of international investors are propelling Africa towards a more sustainable and prosperous future.

  • Nigerian foreign investment in cryptocurrency decreases

    Nigerian foreign investment in cryptocurrency decreases

    Nigerian foreign investment in cryptocurrencies reaches a record low as the nation struggles to attract significant amounts of foreign capital despite the exponential development in the use of cryptocurrencies there.

    The severe lack of dollars caused a 33% decline in foreign direct investment (FDI) in Nigeria in 2022, according to the National Bureau of Statistics (NBS). The lack of data, which caused FDI to plummet from $698 million recorded the year before to $468 million, is indicated by the data.

    The numbers also show that FDI has decreased by about 90% since reaching a peak of $4.7 billion in 2008. The country has a very active crypto community, and many people there are more likely to retain their money in cryptocurrencies than in fiat money, which is a bullish development for cryptocurrencies.

    This is popular because the naira keeps losing value. In Chainalysis’ 2020 Cryptocurrency Geography Report, Nigeria’s rate of adopting and using cryptocurrencies was ranked seventh. Due to the rate of adoption, foreign crypto investments should have grown, but they didn’t.

    Nigeria’s low foreign investment rate may be attributed to cryptocurrency’s limited uptake, according to local data analyst and crypto enthusiast Obinna Uzoije. The lack of bitcoin use in daily economic activities and the ban on financial institutions servicing crypto exchanges accounted for the low investment rate, according to Uzoije.

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    Crypto Ban in Nigeria


    All banks were ordered by the CBN to stop dealing with cryptocurrency-related firms. The CBN ordered banks to terminate the accounts of Bitcoin traders.

    This circular was issued to deposit money banks (DMBs), non-bank financial institutions (NBFIs), and other financial institutions on February 5, 2021, by the Directors, Banking Supervision and Payments System Management, Bello Hassan and Musa Jimoh (OFIs).

    The bank prevented regulated institutions from trading in or processing cryptocurrency exchanges. DMBs, NBFIs, and OFIs were required to discover and shut down cryptocurrency exchange operators and trading accounts. CBN advised local banks to avoid crypto transactions and exchange payments.

    According to CBN, bitcoin, litecoin, and others are used for terrorism financing and money laundering. In 2017, the CBN required banks and other financial institutions to take the following actions pending substantive regulation or determination.

    Banks prohibited virtual money ownership, trade, and transactions. Virtual currency exchanger customers’ identities, verification, and transfer tracking need AML/CFT controls. Due to legal uncertainty, the CBN advised bitcoin investors to invest at their own risk in February 2018. CBN forbids crypto trade and payments.

    10 Best Bitcoin Wallets in Nigeria (Updated 2022)

    The tenacity of Nigerian cryptocurrency users


    Nigeria bans cryptocurrencies, but Nigerians have always preferred digital currencies to fiat cash. In the 2020 Cryptocurrency Geography Report by Chainanalysis, Nigeria was ranked eighth among the 154 countries studied for the rate of adoption and use of cryptocurrencies.

    According to NBS data, Nigerian crypto users need to do more to attract overseas investment. Nigerians “love” crypto, fintech, and entertainment, but no state has encouraged foreign investment in those sectors, according to certified investment trader Olumide Adesina. According to Adesina, building a tech and crypto community in Lagos like Silicon Valley will produce thousands of direct jobs.

    Lagos State Governor Babajide Sanwo-Olu suggested crypto adoption, according to the local press. A cryptocurrency sandbox regulatory framework, a crypto-focused innovation hub, and incentives for bitcoin-accepting businesses are among these proposals.