LAGOS — Foreign Direct Investment, FDI, to Nigeria dropped by 21.34 per cent to $7 billion (N1.120 trillion) in 2012, from $8.9 billion (N1.424 trillion) recorded in 2011, according to the 2013 World Investment Report published by the United Nations Conference on Trade and Development, UNCTAD.

Despite the drop, the report disclosed that Nigeria accounted for 41.67 per cent of the total Foreign Direct Investment flow to West Africa and also accounted for 14 per cent of the total inflow to the African continent.

The report said Africa was one of only two regions in the world to experience an increase in foreign direct investment in 2012, adding however, that inflows to Nigeria and South Africa declined.

“Although West Africa had the biggest share of investment, flows to the region declined by 5 per cent to $16.8 billion largely due to decreased investment in Nigeria. Its FDI inflows fell from $8.9 billion in 2011 to $7 billion last year due to political insecurity and a weak global economy,” UNCTAD said.

According to the report, while global FDI fell by 18 per cent last year, Africa bucked the trend with inflows increasing five per cent to $50 billion, as countries like Mozambique, Tanzania and Uganda reaped the benefits of new discoveries of oil and gas.

The UN report noted that FDI flows to South Africa slumped 24 per cent to $4.6 billion in 2012, largely due to a foreign mining company offloading its stake in a South African subsidiary.

It, however, noted that inflows to Mozambique doubled to $5.2 billion, driven by companies like Brazil’s Vale and London-listed Rio Tinto, who are developing huge offshore gas and coal deposits.

The report further stated that FDI to central Africa surged 23 per cent to a record $10 billion, while in east Africa recently discovered gas reserves in Tanzania and oil fields in Uganda resulted in a 40 per cent jump to $6.3 billion.

African countries, led by South Africa and Angola are stepping up their investment overseas, with FDI outflows from the continent nearly tripling from $5 billion in 2011 to $14 billion last year, the report noted.

UNCTAD also stated that South America was the only other region to see a year-on-year rise in FDI inflows, which grew 12 per cent, adding that flows to the Latin America and Caribbean region as a whole declined.