Where to Invest in Africa 2017/2018

Podcast

It has been a relatively smooth ride for Africa in the six months since we launched the 2017/2018 edition of Where to Invest in Africa.

RMB is here to help you navigate the landscape and provide you with insights to guide you on your African journey.





TOP 10

Economic (in)activity trumps regulatory advances

Our Top 10 most attractive African countries in which to invest is quite different to previous years. In a nutshell, regional stalwarts have struggled to adapt to the prolonged slowdown in commodity prices and sluggish levels of production growth.

Noticeable omissions to the Top 10 this year are Nigeria and Algeria, which have fallen to #13 and #15 respectively. While, on the other hand, Ethiopia and Rwanda have climbed three and four places to #4 and #8.

Determinants of investment-attractiveness scores


Market activity 2016
Market activity 2017
Operating environment 2016
Operating environment 2017
Investment attractiveness 2016
Investment attractiveness 2017
Source: RMB Global Markets



RMB’s Investment Attractiveness Index

View complete rankings View
Scroll table
2017 rank 2016 rank Country 2017 score 2016 score What has improved? What has deteriorated?
1 2 Egypt 6.35 6.21
2 1 South Africa 6.33 6.27
3 3 Morocco 6.12 6.04
4 7 Ethiopia 5.72 5.63
5 4 Ghana 5.69 5.71
6 5 Kenya 5.68 5.68  
7 9 Tanzania 5.59 5.54
8 12 Rwanda 5.53 5.43 Operating environment
9 11 Tunisia 5.52 5.50
10 8 Côte d'Ivoire 5.51 5.57
11 15 Uganda 5.40 5.22
12 13 Botswana 5.39 5.42
13 6 Nigeria 5.32 5.67 Economic activity
14 14 Mauritius 5.24 5.33
15 10 Algeria 5.20 5.50 Economic activity
16 17 Senegal 5.00 5.01
17 16 Zambia 4.97 5.20
18 22 Burkina Faso 4.61 4.48
19 19 Mozambique 4.59 4.79 Operating environment
20 18 Namibia 4.55 4.88 Economic activity
21 20 Cameroon 4.52 4.55
22 24 Mali 4.47 4.45
23 21 Libya 4.42 4.54 Economic activity
24 32 Sudan 4.27 3.81 Operating environment
25 27 Benin 4.25 4.17
26 26 Madagascar 4.16 4.23
27 23 Angola 4.12 4.46 Economic activity
28 25 Gabon 4.08 4.28
29 28 DRC 4.07 4.03
30 33 Malawi 3.94 3.79
31 38 Sierra Leone 3.91 3.54 Economic activity
32 29 Niger 3.90 3.92
33 31 Seychelles 3.89 3.83
34 30 Cabo Verde 3.81 3.85
35 34 Lesotho 3.68 3.68
36 35 Togo 3.55 3.60
37 36 Swaziland 3.50 3.57
38 43 Mauritania 3.37 3.30
39 41 Liberia 3.32 3.37
40 42 Chad 3.20 3.37
41 37 Guinea 3.19 3.56 Operating environment
42 40 Djibouti 3.13 3.39 Economic activity
43 46 São Tomé and Príncipe 3.13 3.09
44 45 Gambia 3.08 3.09 Operating environment
45 39 Zimbabwe 2.97 3.51
46 48 Eritrea 2.95 2.94
47 47 Congo 2.93 3.02
48 49 Guinea-Bissau 2.71 2.61
49 51 Comoros 2.68 2.60
50 50 CAR 2.68 2.61
51 44 Burundi 2.48 3.27 Economic activity
52 53 Equatorial Guinea 2.44 2.21 Economic activity
53 52 South Sudan 1.72 2.32 Economic activity

  • Note:
  1. There was insufficient data for Somalia to be rated. As such, only 53 countries are ranked.

Countries to watch: The top 20

Uganda is steadily closing in on the Top 10 – although the margin between #10 and #11 is still healthy. Public sector investment, the execution of flagship projects, services sector growth and advancements in the upstream oil industry are expected to further Uganda’s medium-term economic development plans.

For the first time in 15 years, Nigeria does not feature in the Top 10, recessionary conditions have eroded its short-term investment appeal. Despite the many challenges it faces, the West African giant is still regarded as a viable long-term investment option.

Algeria, at #15, finds itself in its lowest position in our index records. The country is in a precarious position as its government struggles to generate meaningful growth in the non-oil industry space.

Burkina Faso has pierced the Top 20 due to an accelerated pace of economic activity. It also boasts abundant agricultural land and natural resources that include manganese, marble, limestone, pumice and salt — not to mention that it is also Africa’s fourth-largest gold producer.

Noteworthy mentions: Africa’s investment-grade economies

Botswana, Mauritius, and Namibia are Top 20 stalwarts. This has much to do with the ease of doing business in their respective markets. A commonly asked – and valid – question is why are these nations not in our Top 10. After all, they are rated investment grade, higher than South Africa, and have narrowed the transport infrastructure gap between themselves and that of more advanced economies.

The rationalisation for their exclusion is due to their relatively small markets as market size is a key constituent of our methodology. Combined, the GDPs of the three countries is only 12% of South Africa’s and less than a tenth of Nigeria’s.



Beyond borders: Changes in the global rankings

By extending our investment-attractiveness methodology to include 191 jurisdictions, we can measure Africa’s performance relative to other countries. The unfortunate reality is that African economies are still at the lower end of the global-performance spectrum, which continues to be dominated by the US, UK, Australia, and Germany. More than half the continent is ranked only between 120 and 191.

Egypt and South Africa, our two most attractive investment destination in Africa, rank 45 and 46, surpassing the likes of Portugal, Hungry and Sri Lanka but remain just out of the top 40.



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