Côte d’Ivoire and Kenya – Top Investment Destinations
Last week Standard Chartered Bank released its Trade20 index. Unsurprisingly several countries in Africa made the rising stars investment A-list. This echoes what we have been saying for a while: that a #Renaisnoire (concatenation: “Renaissance” and “Noire” = Black renaissance) is inevitable. The question obviously begs who will be the biggest losers and winners when it comes to deriving the benefits of increased investment across the continent?
What does the index measure?
We are generally very wary of these periodical reports. Measuring the economic output of developing countries as compared to the developed (western) markets is challenging. This is because we do business in Africa differently. To a large degree, it is unmeasured and unbanked. This makes it virtually impossible to compare apples with apples. Having said that, sometimes night and day do align on occasion – it’s called an eclipse 🤭. The methodology ranks countries based on three main criteria.
The first criteria, economic dynamism, measured the “economic performance of a market … by the increase in inward foreign direct investment (FDI), as well as export and GDP growth”. Secondly, trade readiness signaled the “extent to which a market has the foundations to support future trade growth, measured by improvements to physical and digital infrastructure, e-commerce, and the ease of doing business”. Lastly, export diversity measured a “market’s progress in its breadth of exports”. This is shown by the variety of products exported and how export revenue is spread across that product range.”
We agree. These factors, along with other obvious ones which go without saying (like political stability), have a huge bearing on the economic growth of a country. And, as we debate here very few of these factors require “active participation by the government”. In fact, the less participation the better.
The top 3 Investment “rising stars” in Africa
According to the index, Côte d’Ivoire, Kenya, and Ghana are worth a serious look when searching for investment destinations. They rank at 1, 3 and 13 respectively which deserves a solid “thumbs up”. These countries’ infrastructure spends over the past 5-10 years yielded the results hoped for. It has also set them on the right trajectory for the next few years.
Yey but not Yey – Yet
The obvious question begs: will this translate into a proportionate increase in the living standard measure of these countries’ populations? This requires a delicate balance by the administrations: A focus on local beneficiation and skills transfer. From our experience, this is where our governments in Africa tend to drop the ball. Ironically, in our view, this is one of the few roles that our governments actually DO have when formulating policies.
Become a Contributor OR Become an Afropreneur OR Share Your Experience
