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Confusion as Nigeria goes missing on ‘Where to invest in Africa’ Report

Latest report published by leading Africa’s investment directory, Rand Merchant Bank, has shown that Nigeria, as an investment destination in Africa in 2018 is off the radar.

This means that there is high tendency that global investors are not satisfied with Nigeria’s 2018 investment roadmap as driven by the Economic Recovery & Growth Plan of the Federal Ministry of Budget and Economic Planning.

Whereas observers are shocked that for the first time in over 30 years, Nigeria has failed to make the list of destination points for investors willing to invest in Africa, there are fears that the development may not be unconnected with lack of credible data on Nigeria by Rand Merchant Bank.

Business Hilights recalls that the chairman of United Bank for Africa (UBA), Mr. Tony Elumelu had last week in London decried the poor access of Nigerian development data to foreigners which make then use any figure they lay their hands for grading Nigeria.

However, the report, released on Friday, noted that “Nigeria’s exclusion from the list is largely because of recession and its short-term investment appeal”.

“Botswana, Mauritius and Namibia are widely rated as investment grade economies, but they do not feature in the top 10 mostly because of their relatively small size markets – market size has been a key consideration in the report’s methodology.”

The report also said “Uganda, on the other hand, is steadily closing in on the top 10 though its market activity is likely to remain subdued after a tumultuous 2016 marred by election-related uncertainty, a debilitating drought and high commercial lending rates.”

An analyst at Rand Merchant Bank and Co-author of the report, Celeste Fauconnier, said, “Over the past three years, Africa’s economy has been dwindling, mainly due to drop in traditional revenues, resulting in deep and painful budget cuts.

“Some governments went as far as currency devaluation and adoption of hawkish monetary policies as a result of a significant drop in traditional revenues.”

‘Where to Invest in Africa 2018’ includes 191 jurisdictions around the world, measuring Africa’s performance in relation to other countries’ groupings.

The seventh edition of ‘Where to Invest in Africa’, one of the most important findings by Rand Merchant Bank, noted that the African continent could find itself hovering on the brink of disaster if it failed not diversify its economy but continued to depend on its current economic fundamentals (oil).

This report noted that “For three consecutive years, South Africa has been the most popular destination to invest in Africa. Mainly because of its raw materials and mining; the country is the largest producer of gold, platinum and chromium in the world, its currency, equity and capital markets, which are still cut above other African countries”.

Whereas several analysts who bared their mind on the report traced the strange position of Nigeria to the very hard to interpret economic policy of the current government, others linked the development to trending shift to knowledge based economy form the traditional resource based which Nigeria had been leading.

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