Egypt knocks SA off its No 1 spot

THE WHERE to Invest in Africa 2018 report released yesterday by Rand Merchant Bank (RMB) showed that South Africa had fallen from first place for the first time since the inception of the report, ceding its place to Egypt, which was now Africa’s most attractive investment destination.

However, the continent’s other powerhouse, Nigeria, moved outside the top 10 investment destinations on the continent for the first time, with RMB attributing this to the country’s short-term investment appeal having been eroded by recessionary conditions.

RMB said Egypt displaced South Africa largely because of its superior economic activity score and sluggish growth rates in South Africa, which had deteriorated markedly over the past seven years.

Celeste Fauconnier, an analyst at RMB Africa, said some countries had been more nimble and effective than others in managing shortfalls.

Improved Earlier this month, both South Africa and Nigeria moved out of recession after improved second-quarter gross domestic product data, while earlier this year, audit firm Ernst & Young found South Africa, Morocco, Egypt, Nigeria and Kenya collectively attracted 58 percent of the continent’s total foreign direct investment (FDI) projects in 2016.

South Africa saw an increase of 6.9 percent in FDI projects in the period compared to 2015 – accounting for 20.6 percent of all projects undertaken in the continent in the period under review.

The RMB report further found that in South Africa’s favour were its currency, equity and capital markets, which were still a cut above the rest, with many other African nations are facing liquidity constraints.

Rounding off the top ten investment destinations was Morocco, which retained its third position for a third consecutive year, while Ethiopia displaced Ghana to take the fourth spot, mostly because of its rapid economic growth, having brushed past Kenya as the largest economy in East Africa.

Ghana took the fifth position, with Kenya coming in at number six, while Tanzania climbed two places to number seven and at number eight was Rwanda.

The last two spots in the top 10 were taken by Tunisia at number nine with Ivory Coast slipping two places to take up the tenth position.