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South Africa remains the largest recipient of foreign direct investment (FDI) in Africa, according to Brand South Africa.
The country also continues to be the largest source of intra-regional investment, and has recently made a comeback in the top 25 most attractive global investment destinations, the organisation said.
This was evidenced by findings from the EY Attractiveness Programme Africa (APA) 2017, the AT Kearney Foreign Direct Investment Confidence Index, as well as Brand South Africa's Investor Perceptions Research.
The 2017 APA measures the FDI attractiveness of 46 African markets. Its 2017 findings indicate that South Africa experienced a 6.9 per cent increase in FDI flows in 2016.
“South Africa continues to attract the bulk of FDI projects destined for the continent with a share of 20.6 per cent, Egypt at 11.7 per cent, Morocco at 12 per cent, Nigeria at 7.5 per cent, and Kenya at 5.9 per cent,” said Brand South Africa's General Manager for Research, Dr Petrus de Kock.
The 2017 APA further notes that even as its economy remains under pressure, South Africa retains its appeal as a launch-pad for growth across the continent.
Investor confidence
Dr de Kock said the findings on South Africa's FDI profile underline the fact that global investors have confidence in the market and see the country as an attractive investment destination.
“Opportunities identified in these respective indices should be vigorously pursued through a collaborative approach between business and government, especially after the credit ratings downgrade,” he said.
South Africa's diversified economy, geographic location, infrastructure and logistic capabilities play a major role in attracting investment.
The 2017 AT Kearney Foreign Direct Investment Confidence Index is characterised by a perception of safety in developed markets.
However, the 2017 Index marked the emergence of newcomers the UAE and South Africa, which Dr de Kock said was a sign of an increase in investment intentions in emerging markets.
“AT Kearney notes that with the country's improvements in infrastructure and education, investors view South Africa as being poised to lead one of the world's next major manufacturing hubs.” – SAnews.gov.za