Dear Investor, this is why your next shrewd decision is channeling your FDI to Africa:
Africa’s economic feasibility for investment has been adversely understated for the past several decades. Economists have in the past characterized Africa’s economy as one beyond salvage. However taking an introspective look at Africa, we can’t help but consider IMF’s statement that “Africa will be the world’s second-largest economy within the next few years.” as an understatement.
In the recent past investors have been blind on Africa in matters investment; actually, only $3 out of every $1000 FDI from the US was invested in Africa in 2016. However, investment in Africa is now taking a turn from the traditional investment in resources such as minerals. In this new wake of investments, investors are now focusing on health, hospitality and technology to mention but a few. Furthermore, With a lot of factors falling into place at the same time — rapid economic growth, unprecedented political stability, and a young and increasingly middle-class population — the continent is beginning to head toward an anticipative upsurge.
- Growing Young Populace
Statistics have it that the percentage of young people in Africa is rising exponentially and it forecasts that by 2050, the percentage will have doubled. This tells you that the market for consumer goods is anticipated to rise by nearly 200%.Also these figures say that the labor market efficiency is up for a great boost.
- Growth of the middle-class.
Africa’s characteristic of a large number of poor citizens living below $2 a day is speedily changing. It is for a fact that the per capita income has incredibly increased thus the purchasing power of citizens has augmented .There is a fast-pacing trend of brand loyalty in Africa (for instance KFC in Kenya) consequentially and this increases the chances of investment success.
3.Political Stability taking Preeminence
Policies that govern Multinational Corporations are taking a turn to incentivize investors. These policies are being less radically affected by transitions of government in African countries. Also, civil wars have reduced greatly.
4.Diversification of the Economy
Countries in Africa have become less engaged in primary production and are shifting towards the manufacturing and service industries. Ethiopia outstandingly has engaged in an industrialization strategy .Thus, the GDP of African countries is fast rising meaning more chance for your FDI success.
African cities, Nairobi outstandingly are becoming financial, ICT and media hubs. There is an unignorable surge of mobile technology innovations in the continent that would go a long way to boost business efficiency.
Moreover, improved infrastructure, increased business sophistication, intense financial development and creation of robust institutions are among the factors that would guarantee you an investment triumph in Africa.