According to a new report released by Infomineo, Nairobi has become increasingly important for the majority of global Fortune 500 companies.
The report, which focuses on multinationals looking at entering, or already present, in the Middle East and Africa (MEA) region says there was a 17 per cent increase in the number of companies in MEA in 2016 compared to 2015, with Johannesburg being the leading destination for Africa.
“The most attractive cities are Dubai, Johannesburg, Casablanca and Nairobi, and at the lower end of the spectrum, Cairo, Paris, Algiers and Cape Town. Egypt remains behind the leaders due to political instability, however, it has seen a 250% increase in Fortune 500 investment since 2015. Germany and France are leading in terms of coverage rate while China has the lowest presence in the region.” read the report.
The Infomineo analysis includes the regional footprint of multinationals in the MEA region, the most commonly chosen cities, and the factors which influence the selection of the region, country and city – each element revealing the dynamic growth patterns within the region and a clear trend of Fortune 500 companies establishing some kind of presence in MEA.
In 2016, 196 Fortune 500 companies had established a dedicated regional headquarters in the MEA region. In the Middle-East, Dubai is the most popular choice with 138 companies establishing a dedicated entity in the city.
Industry type plays a pivotal role in the selection of city and country. Financial services are more likely to base MEA coverage from London, while technology companies are more inclined towards Casablanca or Lagos.
Kenya’s Nairobi City is the leading destination for the FMCG companies and tends to be the top choice for organisations looking to service Eastern Africa. Dubai and Johannesburg are the most popular hubs overall, but both Casablanca and Nairobi are rapidly gaining traction and international awareness. Casablanca has the highest growth rate overall, while Dubai has the highest count.