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Firm advises FG to improve on investment attractiveness


Multinational professional services firm, EY has advised the Federal Government to improve on its investment attractiveness as a way of building on previous year’s fortune.

Senior Partner and Head of Markets, EY West Africa, Ashish Bakhshi, while sharing insights on a newly released report on Foreign Direct Investments for 2022, said Nigeria needed to improve on FDIs to achieve the ambitious targets it had set for itself to reduce poverty and build a sizeable middle class by 2030.

“Africa’s leaders will need to adopt pragmatism as they respond to a new geopolitical world order so that its member states can optimize the full spectrum of inbound investment opportunities, which will be essential in meeting Africa’s aspirations for a more equitable, wealthier and urbanized middle-class society”, the report read in part.

“Last year saw Africa’s return as a top investment destination hub for global investors. The continent had struggled to attract investment since the onset of COVID-19 and took longer than other regions to recover, as a result of its delayed vaccine rollout and therefore its ability to reopen its 54 national economies. To this, its growth lagged pre-pandemic levels for longer than it did in mature markets, setting back the ambitious targets it had set for itself to reduce poverty and build a sizeable middle class by 2030.

“The new report released by EY, a global multinational professional services firm, uncovered that FDI attracted more than 730 projects across the continent in 2022, injecting $194 billion in capital and creating 154,000 jobs. Significantly, Egypt saw a record of $ 107 billion in capital for its 149 FDI projects. In East Africa, Kenya dominated the FDI landscape while Nigeria was the leading country in West Africa. The countries came in third and fourth respectively for the largest FDI regions on the continent,” the report further said.

The EY’s 13th Africa Attractiveness report tagged ‘A Pivot to Growth’, provides insights into the continent FDI, exposing that the 2022 calendar year saw a strong FDI rebound, led by Renewables inflows, with the West being the largest investor, while the North and Southern hubs of Africa were key beneficiaries.

A notable highlight of the report shows that CleanTech became the largest FDI recipient sector in 2022, leading Africa’s FDI for the first time. While the extractive-based sector FDI inflows continue to fall, FDI into the Services sector, particularly Tech and Business services continued to rise.

In a similar vein, Egypt’s FDI attractiveness continues to rise in prominence as South Africa’s FDI inflows remain flat. The three largest economies in Africa (Nigeria, Egypt and South Africa) are currently facing economic headwinds. Zimbabwe features in the Top 10 for the first time in a decade while Ethiopia and Mozambique exit the Top 10. Nigeria also lost FDI inflow momentum.

The report acknowledges that the West remains the largest source of FDI in Africa, but the UAE became the single biggest investor in Africa. China remains one of the ten largest investors, with India moving into the Top 10 list of investors.



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