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Billions of New FDI Flowing Into West Africa. Where’s the Chinese Money Going?

Source: National Bureau of Statistics and Nairametrics

$1.46 billion of new foreign direct investment made its way to Nigeria in the third quarter of 2020, according to new data from the National Bureau of Statistics, but very little is coming from China. In fact, China (ex Hong Kong) wasn’t among the list of top 15 investors, dominated by the UK, Netherlands, and Ireland.

That’s a very different story from last year at this time, when Chinese venture capital firms plowed a quarter of a billion dollars into Nigeria’s then-booming tech sector, specifically early-stage fintech companies. Expectations ran high back then, before the COVID-19 outbreak, that Chinese VC-financing would continue into 2020 which, of course, did not happen.

But that’s not the case in Ghana, where Chinese investors are leading the way this year as highlighted by Tuesday’s $105 million deal for Chifeng Jilong Gold Mining to buy out Resolute Mining’s stake in the Bibiani gold mine, the second major Chinese mining acquisition in Africa this month.

In the first half of the year alone, at the height of the pandemic, Chinese companies closed 12 deals in Ghana, predominantly in the commodities trading and mining sectors.  

All of this is good news for Yofi Grant, CEO of Ghana’s Investment Promotion Centre, who said yesterday that despite 2020 being a very difficult year, he remains confident that Ghana will end the year with more than a billion dollars of new FDI.

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