Ethiopia to outshine Egypt, South Africa in competition for investment

Ethiopia to outshine Egypt, South Africa in competition for investment

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ACCORDING to the new Africa Risk-Reward Index by Control Risks in co-operation with Oxford Economics, Ethiopia and Kenya might soon outshine Egypt, Nigeria and South Africa in the competition for investment.

Whilst South Africa enjoys a deserved reputation as Africa’s pre-eminent constitutional democracy, several of its key institutions have gradually weakened over the past decade, says the study.

Ethiopia outperforms every African peer with its high reward score of 8.0. Notably, it attracted $3.2bn of foreign direct investment in 2016 – more even than Nigeria, and double the figure for Morocco, the report said.

Ethiopia is one of Africa’s fastest growing economies and continues to offer strong prospects. Growth averaged 10 percent from 2010 to 2015 and although 2016 growth was slower at 6.5 percent the expansion remains impressive.

In a related development, Ethiopia has moved up a notch in its investment attractiveness according to the latest report by Rand Merchant Bank (RMB), Where to Invest in Africa 2018.

Ethiopia overtook Ghana to take fourth spot, up three places from last year’s report, mostly due to rapid economic growth, having brushed past Kenya as the largest economy in East Africa.

This report follows the 2017 World Investment Report that also puts Ethiopia among the top five recipients of Foreign Direct Investment in Africa. Similarly, World Bank’s Global Economic Prospects said Ethiopia will be the fastest growing economy in Africa for the year 2017, with projected growth of 8.3 percent.

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