Investment Challenge In Nigeria Lies In Converting Available Capital Into Bankable Projects, Productive Growth

By Enam Obiosio

The challenge before us is not simply to mobilise more money, but to build credible businesses and infrastructure projects capable of attracting, absorbing and rewarding long-term capital.

We have spent considerable time discussing the need for investment to accelerate Nigeria’s economic growth. We have called for capital inflows, celebrated financial reforms and acknowledged the enormous financing requirements of our infrastructure deficit. Yet, I believe we must confront a more fundamental question: do we have enough investment-ready businesses and bankable projects capable of attracting the capital we so urgently seek?

This question deserves greater attention than the familiar appeal for increased investment. Capital does not automatically translate into productive economic activity. It must find credible projects, competent management, transparent financial structures and institutions capable of managing risks. Without these conditions, even substantial pools of available funds may remain disconnected from the real economy.

That was one of the important considerations emerging from the 32nd Nigerian Economic Summit (NESG 32), held in Abuja under the theme, ‘Growth That Works: Delivering Jobs, Productivity and Shared Prosperity’. FirstCap Limited, a subsidiary of First HoldCo Plc, participated in the discussions, with its Managing Director and Chief Executive Officer, Ukandu E. Ukandu, contributing to conversations on productive investment and capital mobilisation.

The discussions on ‘Investing in Nigeria’s Productive Future and From Reform to Capital Mobilisation: Unlocking the Next Wave of Productive Investment in Nigeria’ brought an important distinction into focus. We must separate the availability of capital from the availability of opportunities capable of attracting it.

Nigeria has domestic institutional funds, particularly pension assets and other long-term savings pools. Yet, the existence of these funds does not mean that they can automatically finance every business or infrastructure proposal. Institutional investors have fiduciary obligations. They must assess the quality of projects, the reliability of projected returns, governance arrangements, repayment capacity and the risks attached to their investments.

I therefore consider investment readiness one of the most important missing links in our economic development conversation.

We cannot continue to expect institutional investors to finance businesses that lack credible financial statements, transparent ownership structures, sound corporate governance and clearly defined business models. Neither can we expect long-term capital to flow into infrastructure projects whose commercial viability, contractual arrangements and revenue mechanisms remain uncertain.

If we want capital to finance production, we must first make production investable.

This is particularly important in power and industrial utilities, where infrastructure deficiencies continue to constrain manufacturing, productivity and business competitiveness. We cannot build a productive economy on unreliable electricity, inadequate industrial infrastructure and financing arrangements that are too short-term for the projects they are expected to support.

We must therefore move beyond conventional lending structures and embrace financing instruments suited to the scale, duration and risk profiles of different investments. Blended finance, credit enhancement mechanisms, guaranteed bonds and professionally managed investment vehicles offer possibilities for attracting institutional capital into projects that might otherwise struggle to secure financing.

However, we should not mistake financial innovation for a substitute for project discipline. Guarantees cannot permanently compensate for poorly designed projects. Blended finance cannot make commercially unviable investments sustainable indefinitely. And sophisticated financing structures cannot replace competent management, transparent reporting and effective accountability.

We must get the fundamentals right. This is where the contribution of investment banking institutions becomes particularly important. We need institutions capable of connecting businesses with investors, structuring transactions, assessing risks, preparing companies for capital raising and developing financing arrangements that match investment requirements with available funding.

FirstCap Limited participation at NESG 32 brings this responsibility into the conversation. Its emphasis on governance, financial transparency, credible reporting and financing structures appropriate to different stages of business growth reflects an important reality: capital mobilisation begins long before an investor writes a cheque.

For us, this should also be a call to Nigerian businesses, particularly small and medium-sized enterprises, to reconsider how they approach growth and financing. We cannot build investment-ready enterprises around informal records, weak internal controls and financial information that investors cannot independently assess. We must institutionalise our businesses if we expect institutional capital to take them seriously.

Government also has a responsibility. We need predictable policies, credible regulatory institutions, transparent procurement processes and commercially structured infrastructure projects. Public resources should increasingly be used to unlock private investment, rather than shoulder every financing obligation alone. But this requires careful project preparation, clear risk allocation and accountability for outcomes.

Ultimately, we must measure the success of capital mobilisation by what the capital produces. Does it finance factories? Does it improve electricity supply? Does it create jobs? Does it increase industrial output? Does it improve the competitiveness of Nigerian businesses?

These are more meaningful measures of investment success than the volume of funds announced or the number of financing agreements signed.

I believe Nigeria must now move from discussing the abundance of capital to building the credibility of investment opportunities. We must create the institutional conditions under which savings become investment, investment becomes productive capacity, and productive capacity generates employment, income and shared prosperity.

The real task before us is not merely to attract capital. It is to give capital somewhere productive, credible and sustainable to go.

 Enam Obiosio is a public relations and investor relations practitioner and journalist with experience in arts and business journalism, with expertise spanning financial markets, economic policy, infrastructure, corporate communications, and the creative economy.