Nigeria has been left out of the list of the top investment destinations in Africa for 2021, compiled by a South African investment and advisory firm, Rand Merchant Bank, IgbereTV reports.
The ‘Where to Invest in Africa 2021’ saw Egypt named Africa’s top investment destination, while Morocco and South Africa came in second and third, respectively. Rwanda and Botswana also moved up the rankings coming in at fourth and fifth, respectively.
Ranking process
RMB stated that the ranking was “Based on their operating environments.”
RMB’s Africa Economist, Daniel Kavishe, noted that this year’s report took into account “the extent of the pandemic’s impact by sketching the landscape of the continent pre-COVID-19, and then painting a picture of both its actual and potential outcomes through and post-pandemic.”
Kavishe, who authored the report, added that a fiscal score was also part of the methodology. Stating that it was essential because “fiscal scores are important indicators of how governments respond to COVID-19.”
According to Kavishe, the publication needed to explore key themes emanating from Africa’s developmental aspirations.
In 2017, Nigeria dropped to 17th position in the RMB report but was able to bounce back to the top 10, retaining the 8th position from 2018-2019.
The top 10 investment destinations in Africa according to RMB:
Egypt: While Egypt’s economy was hard hit by the pandemic, it was also one of the first to bounce back to a path of growth. This, owing to the swift measures it introduced and the fact that it been on a stronger footing at the outbreak of COVID-19.
Morocco: The economy of Morocco continues to benefit from political stability. A special fund to combat COVID-19 was established in 2020, representing 2.7% of GDP. Two-thirds of the funds were to be provided by private sources and one third by the government.
South Africa: The southern-most country in Africa offers a strong manufacturing and retail base that will continue to support southern African regional economies with goods and services.
Rwanda: Rwanda continues to benefit from the efforts it has made to improve its operating environment. Furthermore, as part of the National Strategy for Transformation (NST), various investments should support the construction and energy sectors over the next few years.
Botswana: The country has high foreign-exchange reserves, which have enabled it to weather the pandemic-induced economic storm better than most. The Pula Fund, a sovereign fund created in 1994 that finances a large part of the budget deficit, has meant that fiscal dependency on debt has been low.
Mauritius: Aided by an extremely favourable tax regime, its financial sector will remain one of the main drivers of Mauritius’ economy into the future – notably through cross-border investment activities and banking services.
Côte d’Ivoire: A rise in private investment should continue to fuel construction, agri-industry and services (trade, transport and ICT in particular). Private investment will benefit from the impetus provided by public investment under the 2016-20 National Development Plan.
Kenya: The Kenyan government’s efforts to ensure that implementation of the “Big Four” plan focused on industrialisation, universal health coverage, food security and affordable housing will invariably lead to fast economic growth.
Tanzania: Tanzania has been on a rapid path of development over the past few years. This growth can be attributed to consistent public investment from the government in key secondary and tertiary sectors, ranging from the energy sector to advancements in the telecommunications and finance sectors.
