Business
Africa Investment – From Foreign Direct Investment to Africans investing in Africa
While FDI and portfolio flows from outside the continent will continue to provide long-term capital, skills and technology, many believe growing intra-regional investment will create a virtuous cycle, encouraging greater foreign investment.
“Foreign investors are much happier putting their money behind local investors,” said Gachao Kiuna, chief executive of TransCentury, a Nairobi-listed infrastructure company which invests in countries such as Uganda, Mozambique and the Democratic Republic of Congo.
“Domestic investment is the real trigger towards driving high investment levels,” he added.
South Africa has led the way in intra-African investment, with companies like MTN and Shoprite among the first to venture further north. Africa’s biggest economy is now one of the top five overall investors on the continent.
To the east and west, regional powerhouses Kenya and Nigeria are also major cross-border investors.
Nigeria’s Dangote Cement, controlled by the continent’s richest man Aliko Dangote, is investing US$5 billion to build an African cement empire, with projects planned in Cameroon, Senegal, Ethiopia, Zambia and South Africa.
Kenyan and Nigerian banks have also expanded into their surrounding regions. Nigeria’s United Bank for Africa, with operations in 18 other African states including Ghana, Mozambique and Tanzania, expects to generate half its revenue from the rest of Africa in coming years, from 20 percent now.
