Emerging markets drive investment into Africa - Ernst & Young report

JOHANNESBURG Mon May 6, 2013 8:24pm IST

A labourer walks at Shanghai Hui Bo Investment Co (SHIC) for manufacturing railway cement sleepers and accessories in north Khartoum February 14, 2013. REUTERS/Mohamed Nureldin Abdallah/Files

A labourer walks at Shanghai Hui Bo Investment Co (SHIC) for manufacturing railway cement sleepers and accessories in north Khartoum February 14, 2013.

Credit: Reuters/Mohamed Nureldin Abdallah/Files

Related Topics

JOHANNESBURG (Reuters) - Foreign direct investment from emerging markets into Africa outpaced that from developed markets in 2012, but the number of new FDI projects into the continent fell 12 percent from the previous year, Ernst & Young said on Monday.

Despite this drop, which came amid a 15.2 percent decline of FDI project flow globally, Africa's share of global FDI rose in the past five years to 5.6 percent in 2012, reflecting greater investor interest, the financial consultancy said in a report.

Ernst & Young's 2013 Africa Attractiveness survey said that greenfield investments on the African continent from emerging markets such as China and United Arab Emirates increased in 2012, while those from developed markets declined.

The United States, Britain and France have been the three biggest investors in Africa over the past decade, but only the UK increased its project numbers from 2011 to 2012.

New FDI projects from the United States and France in Africa decreased by 22 percent and 39 percent respectively in the same year to year period, while projects from the UAE more than doubled, and those from China grew 28 percent.

"In the period since 2007, this category of investment from emerging markets into Africa has grown at a healthy compound rate of over 20.7 percent, in comparison to investment from developed markets, which has grown at only 8.4 percent," the report said.

Ernst & Young said Africa's strong growth - the continent's economy has more than trebled since 2000 and is expected to grow by 4 percent in 2013 and 4.6 percent in 2014 - should be attracting higher levels of FDI.

"There is no doubt ... the African growth story is real and that the potential over the next 10-20 years is even bigger," said Ajen Sita, Ernst and Young's Managing Partner for Africa.

(Editing by Pascal Fletcher, Ron Askew)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Culling Plans

REUTERS SHOWCASE

Root Out 'Bad Apples'

Root Out 'Bad Apples'

RBI chief calls for cleaning up of banking system.  Full Article 

Android One

Android One

Google launches $105 Android One; eyes low-price smartphone boom.  Full Article 

India-Vietnam Ties

India-Vietnam Ties

India tightens Vietnam defence, oil ties ahead of China Xi's visit.  Full Article 

Cognizant Deal

Cognizant Deal

Cognizant to buy TriZetto for $2.7 billion to boost healthcare business  Full Article 

Inflation Eases

Inflation Eases

Aug WPI inflation eases to near five-year low of 3.74 percent  Full Article 

Kashmir Floods

Kashmir Floods

Disease threatens as Kashmir flood waters turn fetid  Full Article 

Hepatitis Drug

Hepatitis Drug

Gilead licenses hepatitis C drug to Cipla, Ranbaxy, five others   Full Article 

Trade Deficit

Trade Deficit

Exports growth slows to 2.4 pct in August  Full Article 

Battle for Heineken

Battle for Heineken

Four generations on, Heineken family won't loosen grip  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage