Africa’s 54 distinct economies are laden with opportunities but also fraught with challenges, which can be daunting for even the most experienced of investors.
Using a blend of quantitative and qualitative factors, RMB’s attractiveness index ranks Africa’s most appealing investment destinations. These scores are derived through a combination of two variables — economic activity and operating environment — arguably the most crucial inputs to investment.
The rankings and sector outlooks are complemented by a detailed look at power and agriculture — two of Africa’s most underinvested sectors.
Agriculture, when the lifeblood of an economy, employs the vast majority of a country’s population. But, despite an abundance of arable land, Africa continues to import food to feed insatiable demand that is set to triple by 2050.
Like agriculture, energy is fundamental to sustainable growth. However, electrifying the continent requires more funding than any government or donor can reasonably provide, necessitating private funding.
‘If you want to go fast, go alone. If you want to go far, go together’ — African proverb
South Africa continued to hold its own as the most attractive destination in Africa, despite its score continuing to fall due to a weaker business environment and a faltering growth outlook.
Egypt recaptured the number two spot, dislodging Nigeria, following three years of political instability. Its large domestic market, relatively low labour costs and rapid technological advancement have revived interest in the North African giant.
Morocco at three, edged Ghana to four, as its successful integration of value chains and collaborations between big firms and SMEs impressed offshore investors.
Nigeria’s slide to fifth position is the result of a combination of local deterrents and its relative economic underperformance over the last year. However, the peaceful elections reinforce our belief in its long-term economic viability.
Ethiopia’s well-deserved sixth spot is testament to its stable economic environment, strong investment guarantees, natural resources and programmes to develop skilled labour.
Tunisia continues to slide down the rankings — its seventh position reflects its struggle to revive its tourism industry and safeguard its borders against terrorist attacks.
Algeria has its improved economic growth outlook and better competitiveness to thank for maintaining its number eight spot.
Kenya entered the rankings at ten, nudging Rwanda down to 11 after only a year in the top ten.