Nigeria has ranked as poorly as Sudan among countries that received the least foreign direct investment in Africa according to the ninth Ernst & Young Africa Attractiveness report.
All of the major economies, South Africa, Nigeria, Egypt, Angola and Egypt lagged in terms of foreign direct investment (FDI) to gross domestic product (GDP). Angola and Nigeria come in for a particular mention, as both are heavily dependent on oil export revenues and scored very weakly in on World Bank’s Ease of Doing Business index. Only two African economies made it into the first quartile of Ease of Doing Business rankings, namely Mauritius and Rwanda. The latter strongly enjoys the benefits of its efforts, scoring 0.35 per $1bn of GDP, using our FDI scoring methodology explained above, nearly double the continent’s average.
“There is certainly FDI inflow into Nigeria. I think the projected economic recovery will continue to be a magnet for FDI. What we have also seen is that the countries that have attracted the most FDI to GDP are also ranked high on the World Bank’s ease of doing business index,” Roderick Wolfenden, Africa Markets Leader said at the launch of Ernst & Young’s ninth edition of Africa Attractiveness Report.
“Nigeria, South Africa have already been recognised as technology hubs with Kenya on the east. With the massive and strong population that Nigeria has a focused agenda around driving the service industries, the consumer side of it and technology, would look to me like areas that Nigeria could focus on to really help support FDI inflows and the economic recovery that Nigeria has embarked on,” Wolfenden said.
According to analysts, one of the challenges facing African countries is a perception gap. Foreign companies doing business in Africa see opportunities but this is not the case for those yet to enter the African market.
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