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Harare – Foreign direct investment (FDI) into southern Africa has doubled to $13bn with South Africa and Mozambique taking the bulk of the money invested into the region, a report said on Tuesday.
This strengthens the view that global investor interest in Africa is rebounding.
The continent’s abundant natural resources, booming population and infrastructure requirements are the major factors contributing to its attractiveness for investors seeking returns, economists say.
SA, the African continent’s second-biggest economy after Nigeria, has led the investment rush into southern Africa and nearly doubled its investment inflows.
According to the 2014 World Investment Report released by the United Nations Conference on Trade and Development (Unctad), SA had investment inflows of just above $8bn in 2013 compared to $4.5bn the previous year.
“In Southern Africa, investment inflows almost doubled to $13bn, mainly due to record high flows into South Africa and Mozambique. In both countries, infrastructure was the main attraction.
“In Mozambique, investments in the gas sector also played a role,” said Unctad in a release accompanying the report.
Although investor interest in southern Africa has strengthened in the past year and the value of foreign investments into the region doubled to $13bn, mineral-rich Zimbabwe recorded flat investment inflows of about $410m.
Zimbabwe, battling to emerge out of an economic slowdown that has tipped the economy into deflation, is struggling to shrug off its high risk perception and fix its regulatory framework.
Zim indigenisation a major drawback
The indigenisation policy, which the government has pledged to improve, is seen by fund managers and analysts as the major drawback for potential investments.
The top five African countries that attracted the highest value of foreign investments include SA, Mozambique, Nigeria, Egypt and Morocco.
Unctad said “despite increasing their share of foreign direct investment into landlocked developing countries from 18 to 23 percent, the picture for African Landlocked Developing Countries was mixed” as half of the economies “experienced falls”.
The other half, comprising mainly the mineral-exporting countries, notched up increases.
Zambia - which mainly produces copper - had one of the strongest performances, with FDI into the country topping $1.8bn.
The UN investment body said global FDI trends had returned to growth in 2013, with inflows rising 9% to $1.45trn.
The organisation has now projected global FDI to rise to $1.6trn by the end of this year.
“Fragility in some emerging markets and risks related to policy uncertainty and regional instability may negatively affect the expected upturn,” Unctad said.
This strengthens the view that global investor interest in Africa is rebounding.
The continent’s abundant natural resources, booming population and infrastructure requirements are the major factors contributing to its attractiveness for investors seeking returns, economists say.
SA, the African continent’s second-biggest economy after Nigeria, has led the investment rush into southern Africa and nearly doubled its investment inflows.
According to the 2014 World Investment Report released by the United Nations Conference on Trade and Development (Unctad), SA had investment inflows of just above $8bn in 2013 compared to $4.5bn the previous year.
“In Southern Africa, investment inflows almost doubled to $13bn, mainly due to record high flows into South Africa and Mozambique. In both countries, infrastructure was the main attraction.
“In Mozambique, investments in the gas sector also played a role,” said Unctad in a release accompanying the report.
Although investor interest in southern Africa has strengthened in the past year and the value of foreign investments into the region doubled to $13bn, mineral-rich Zimbabwe recorded flat investment inflows of about $410m.
Zimbabwe, battling to emerge out of an economic slowdown that has tipped the economy into deflation, is struggling to shrug off its high risk perception and fix its regulatory framework.
Zim indigenisation a major drawback
The indigenisation policy, which the government has pledged to improve, is seen by fund managers and analysts as the major drawback for potential investments.
The top five African countries that attracted the highest value of foreign investments include SA, Mozambique, Nigeria, Egypt and Morocco.
Unctad said “despite increasing their share of foreign direct investment into landlocked developing countries from 18 to 23 percent, the picture for African Landlocked Developing Countries was mixed” as half of the economies “experienced falls”.
The other half, comprising mainly the mineral-exporting countries, notched up increases.
Zambia - which mainly produces copper - had one of the strongest performances, with FDI into the country topping $1.8bn.
The UN investment body said global FDI trends had returned to growth in 2013, with inflows rising 9% to $1.45trn.
The organisation has now projected global FDI to rise to $1.6trn by the end of this year.
“Fragility in some emerging markets and risks related to policy uncertainty and regional instability may negatively affect the expected upturn,” Unctad said.
