South Africa ranks 3rd in continent's investment destinations: RMB
South Africa Finance Minister Tito Mboweni attends the World Economic Forum on Africa in Cape Town, South Africa, Thursday, Sept 5, 2019. Delegates attending the three-day summit that will tackle the issues faced by the continent by focusing on how to scale up the transformation of regional architecture related to smart institutions, investment, integration, industry and innovation. [Photo: AP]
South Africa comes as the third preferred investment destination in Africa in the latest Rand Merchant Bank (RMB) ranking.
It slipped another place this year, following Egypt and Morocco in the rankings set in the 9th edition of Where to Invest in Africa report issued Wednesday by the South African financial institution.
The bank attributed South Africa's continued descent in the rankings to its depressed economy and an absence of structural reforms.
"South Africa remains Africa's hotspot for portfolio investment. With many countries facing severe liquidity constraints, South Africa's financial markets and level of financial inclusion are still a cut above the rest," said Neville Mandimika, an Africa analyst at the RMB Global Markets Research.
South Africa is followed by Kenya, Rwanda and Ghana in the RMB rankings. Other countries that make the top 10 are Cote d'Ivoire, Nigeria, Ethiopia and Tunisia.
"Financial services play a critical role in securing Africa's future. Without sustainable funding and commercial credit, project development in key areas such as infrastructure, healthcare and energy projects remain concepts rather than reality," said Nema Ramkhelawan-Bhana, head of the RMB Global Markets Research.
"The ICT (information and communication technology) sector and Internet access in particular, long viewed as a luxury in Africa, are fast becoming crucial to inclusive economies," she said.
According to the RMB report, for the African continent, manufacturing is set to take the central stage due to its advantage of an abundance of natural resources. Africa is expected to focus on turning its raw materials into manufactured goods to boost exports while reducing reliance on imports.