This is according to Ernst & Young’s 2014 Attractiveness Survey for Africa, which indicates the continent’s rapid development in a short space of time.
“Given all the positives that we have observed and analysed over the past four years, we remain convinced that the African growth story is a compelling one, and it should be attracting even greater numbers of Foreign Direct Investment projects,” Ernst and Young said in their report.
The survey examines certain countries or regions as an investment destination, with the aim of helping businesses to make sound investment decisions, and governments to remove barriers to future growth.
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The report, which is done every four years, added that Africa has moved from ranking last in terms of the most attractive investment destination in the world in 2011 to now being the second-most attractive in the world.
This move is a clear indication of the growth not only taking place on an investment level but also in terms of ease of doing business, infrastructure and industries.
According to the report, the share of intra-African projects in the continent had reached an all-time high in 2013 by growing to 23 per cent from 17 per cent in 2011, and from 8 per cent in 2007.
“Within sub-Saharan Africa, Southern Africa is the leading region in terms of absolute numbers of FDI projects, while both East and West Africa have experienced strong growth rates,” Ernst & Young explained.
“South Africa remains the largest destination for FDI projects, with a widening lead. However, a number of other countries, including Ghana, Nigeria, Kenya, Mozambique, Tanzania and Uganda, are becoming more prominent on investors’ radar.”
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Of the booming consumer sectors within the continent, Technology, media and telecommunications industry takes top position in the continent having grown to 20 per cent in 2013 from 14 per cent between 2003 and 2007.
The retail and consumer products sector came in second place, growing to 17 per cent in 2013 from 12 per cent between 2003 and 2007.
“Investors see the three regional hub markets — namely South Africa in the South, Nigeria in the West and Kenya in the East — as the most attractive investment destinations in sub-Saharan Africa. These three countries account for over 40 per cent of total FDI projects in [the region],” the report explained.