Africa’s rapid growth attracting more investments

Although the number of foreign direct investments (FDI) fell by 8.4 percent in 2014, capital investment into Africa surged to US$128 billion, a year-on-year increase of 136 percent, according to the recently released Ernst & Young 2015 Africa Attractiveness Survey and the average investment increased to US$174.5 million per project, up from US$67.8 million in 2013.

According to Charles Brewer, Managing Director of DHL Express Sub-Saharan Africa, this is positive for the continent’s outlook, highlighting that FDI in the region is being stimulated by a number of megadeals, instead of numerous smaller deals.

“The perception of investing in Africa has traditionally been rather negative, coupled with the fear of the unknown. However, in 2014, traditional investors refocused their attention on the continent, attracted by its strong macroeconomic growth and outlook, improving business environment, a rising consumer class, abundant natural resources and infrastructure development.

These factors have resulted in global capital investment and job creation hitting an all-time high during 2014 on the continent.”

Efficient infrastructure is critical for ensuring the effective functioning of the continent. As it stands, underdeveloped infrastructure drives up logistics costs, and it is estimated that supply chain costs are up to nine times more expensive in Africa in comparison to other regions in the world.

“With increased FDI and continued macro-economic growth, I believe that Africa will be an economic powerhouse in the future. The region is abound with untapped opportunities and has much scope for growth.”

Brewer says that it is for this reason that DHL Express continues to see Sub-Saharan Africa as one of the most prominent areas of growth for the business globally, and therefore continue to invest significantly in the region.

“DHL Express continues to invest significantly in Sub-Saharan Africa in order to ‘Lift The Platform’, to expand our capabilities and cater for continued growth across all markets, with planned investment of millions of dollars across Sub-Saharan Africa in 2015.

Major projects underway include upgrades to facilities and shipment handling systems in South Africa, Kenya, Uganda, the Democratic Republic of Congo, Rwanda, Angola, Zimbabwe and Botswana.  Later this year, we will begin planned upgrades in Ghana, Nigeria, Ethiopia, Benin, Cameroon, Guinea Republic, Gabon, Tanzania, Mauritius and Cote D’Ivoire.”

Continued focus and investment in market-leading infrastructure will better connect Africa to the rest of the world, and create more opportunities for African businesses, allowing them to trade across borders and with new target markets.

Source: IT News Africa