A recent Ernst & Young study has proclaimed Kenya the biggest investor in other African countries.
According to the report of the study, South Africa is no longer the chief investor.
Kenya overtook South Africa to become the biggest investor in terms of the number of projects in 2015.
The East Africa country championed with the 36 investment projects it undertook in other African countries the previous year. While South Africa humbly follows behind with its 33 projects.
The report highlighted that Kenya is ‘a big gainer’ in foreign direct investment (FDI).
Globally, it ranked Kenya the seventh major source of foreign direct investment to Africa.
East Africa, it said, recorded its highest share of FDI across Africa, achieving 26.3% of total projects in 2015. And, Kenya is ‘a bigger gainer’.
However, the report stipulated that Southern Africa is still the largest investment region in Africa.
This is so despite the fact that projects were down 11.6% from 2014 levels.
Also, the West Africa region saw a rebound in FDI projects by 16.2%. The region also, outpaced Southern Africa to became the leading recipient of capital investment on the continent.
South Africa’s GDP Decline
Speaking, Ernst & Young’s Chief Executive Officer, Ajen Sita said: “Over the past year, global markets have experienced unprecedented volatility.
We’ve witnessed the collapse of commodity prices and a number of currencies across Africa.
…with reference to the two largest markets, starting with South Africa, we saw GDP growth decline sharply to below one percent and the country averting a credit ratings downgrade.
In Nigeria, the slowdown in that economy was impacted further by the decline in the oil price and currency devaluation pressure.
The reality is that economic growth across the region is likely to remain slower in coming years than it has been over the past 10 to 15 years. The main reasons for a relative slowdown are not unique to Africa.
In fact, Africa was one of the only two regions in the world in which there was growth in FDI project levels over the past year.”
Generally, the report asserted that Sub-Saharan Africa is one of the fastest growing regions in the world. That, it said, is reflected in the foreign direct investment levels in 2015 where FDI project numbers increased by seven percent.