Egypt among top 3 African investment destinations – RMB

Egypt has been ranked as the third-most attractive investment destination in Africa, according to a new report released by Rand Merchant Bank (RMB) on Tuesday.

The report places Seychelles and Mauritius at the top destinations attracting investment, highlighting their strong economic performance, favourable investment climate, and high social and human development indicators.

The Johannesburg-based lender assessed 31 African nations based on economic performance, market accessibility, investment climate, and social and human development.

Despite their small size, the two Indian Ocean island nations excel due to their economic stability and favourable business environments. RMB Chief Economist Isaah Mhlanga noted that Africa faces “significant turbulence” due to geopolitical tensions, including Russia’s war in Ukraine and the conflict between Israel and Hamas, which have disrupted trade flows.

Persistent global inflation has also led central banks to maintain high interest rates, keeping the cost of funding for African borrowers elevated.

Egypt, with its large market of over 110 million people, ranked first in economic performance and potential. The nation scored well on economic complexity, innovation, human development, and income equality but faced challenges in personal freedom.

RMB highlighted that Egypt is attractively positioned relative to European markets, making it a key investment hub on the continent.

South Africa, once a leading investment destination, has slipped in the rankings due to weak economic growth, high unemployment, and ailing infrastructure.

The country’s outlook may improve if the new coalition government fulfils President Cyril Ramaphosa’s pledge to accelerate economic reforms. However, RMB cautions that foreign investors will likely wait for tangible progress in South Africa’s reform efforts before increasing investments.

Attribution: Bloomberg & RMB Where to Invest in Africa Report