Where to invest in Africa

Where to Invest in Africa 2019

Where to Invest in Africa provides easily digestible data and analysis to firms considering investing in Africa, and explores new opportunities for those already vested in the continent.

What's inside...

Where to invest in Africa

CHAPTER 1.0

RMB’s investment attractiveness rankings

We begin by assessing each African economy’s investment potential. RMB’s Investment Attractiveness Index does this by overlaying macroeconomic fundamentals with the practicalities of doing business on the continent.

CHAPTER 2.0

Infrastructure in Africa

If Africa’s gaping infrastructure chasm is to be bridged, serious investment is needed. The African Development Bank’s (AfDB) most recent estimation of infrastructure needs is between US$130bn and US$170bn annually. But the continent’s available capital is insufficient to achieve this. Africa must attract private capital to accelerate the building of infrastructure.

Where to invest in Africa

Africa’s investment needs

Infrastructure subsector Target by 2025 Annual Cost (US$BN) Notes
Power
  • 100% urban electrification
  • 95% rural electrification
30-50 New Deal on Energy target by 2025
Water supply and sanitation
  • 100% access in urban areas
  • 100% access in rural areas
56-66
  • Water access includes: piped water, public tap/ standpost, safe wells/ boreholes
  • Sanitation access includes: improved latrines, safe pit latrines, septic tank, sewer
Information and communication technology
  • Universal mobile coverage
  • 50% of population within 25km of a fibre backbone
  • Fibre to home/premises
  • Internet penetration rate (10%)
4-7
Road and other transport sectors (air, rail and port)
  • 80% preservation
  • 20% development
35-47
  • Preservation: maintenance and rehabilitation
  • Development: upgrading and new construction
Total 130-170
Currently, just a fraction of the AfDB’s US$130bn-US$170bn infrastructure needs estimate – a mere US$45bn – is spent, two thirds of which is domestically financed from taxes. Africa must attract private capital to accelerate the building of critical infrastructure needed to unleash its potential
Where to invest in Africa

CHAPTER 2.1

Hard Infrastructure

Tangible – or hard – infrastructure relates to the physical structures that connect people, places and businesses to the economy. These comprise transport, power (energy) and communication technology.

CHAPTER 2.2

Soft Infrastructure

An often-overlooked segment of economic development is that of soft infrastructure. And yet it is integral to the bigger infrastructure picture in Africa. Hard infrastructure is essential. But it is soft infrastructure that is partly responsible for the quality of that growth.

Where to invest in Africa
Where to invest in Africa

CHAPTER 2.3

Financing Infrastructure

The principal risk to the creation of sustainable infrastructure in Africa is a shortage of funding. There is no doubt that the continent is still underserved. Public funding is constrained, while traditionally supported aid flows are diminishing, demanding greater private-sector assistance.

Africa’s funding – sectoral split

Public funding

Where to invest in Africa

Private funding

Where to invest in Africa
Source: IBM, RMB Global Markets

CHAPTER 2.4

Regional Infrastructure

Building economies of scale through regional integration could fundamentally change the face of continental trade by boosting competitiveness through increased productivity and reduced unit costs.

Where to invest in Africa

Number of projects currently underway – split between private and public investments

Where to invest in Africa
Source: IBM, RMB Global Markets
Where to invest in Africa

CHAPTER 2.5

The rise of new technologies

The concept of digitalisation in Africa is not a new one. But there are new challenges – and new opportunities – that it brings. Debates on the pros and cons of the impact of digitalisation on an economy are also nothing new.

CHAPTER 3

Country snapshots

Our country snapshots are an alphabetical summary of each African country’s macroeconomic environment and RMB’s Investment Attractiveness scorings.

Where to invest in Africa
Where to invest in Africa

CHAPTER 4

Appendices

This section comprises our data tables, methodology and sources.

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