Kenya remains East Africa’s top investment destination in the Where to Invest in Africa 2020 report released by South Africa’s Rand Merchant Bank. The country was ranked fourth in Africa behind Egypt, Morocco and South Africa.
This marks an improvement from last year’s ranking which placed Kenya at position 5 in Africa. Rwanda makes this year’s list at position five (5) while Ethiopia is ranked at position nine (9). Tanzania, however, dropped out of the top 10 listings this year, after being ranked 7th last year.
Kenya’s position is attributed mostly to the above 5% expected growth rates, helped by favourable weather. The economy also benefits from diversity as well as a sustained expansion in consumer demand, urbanization, East African Community (EAC) integration, structural reforms and investment in infrastructure, including an oil pipeline, railways, ports and power generation.
Egypt has maintained its position, for the 3rd year, as Africa’s most favourable investment decision due to an enormous market paired with a sophisticated business sector. There’s also been an improvement in the business environment driven through government programs and an increase in investments from the private sector.
However, South Africa, Ethiopia and Tanzania have notably shown a decline in the rankings. This is mainly due to a deterioration in the ease of doing business with South Africa, in particular, enduring a cyclical downturn.
Some of the sectors identified to spur Africa’s growth are mineral resources, retail, finance, ICT, manufacturing and construction.
Financial services play a critical role in securing Africa’s future. Without sustainable funding and commercial credit, project development in key areas such as infrastructure, healthcare, and energy projects remain concepts rather than realityNema Ramkhelawan-Bhana, co-author Where to Invest in Africa 2020 Report
Manufacturing is also expected to take centre stage as more countries focus on turning their raw materials into manufactured goods to boost exports and reduce reliance on imports.