5 reasons why you should invest in Africa now
African countries with growing economies are factors in global economic development. If you are looking for reasons to invest in the African continent, consider the reasons below.
1 . To begin with, HIGH INVESTMENT RATE
According to the United Nations, Africa is a prosperous region. And now is the best time to invest here. The United Nations report disclosed that the region recorded 11.4% growth in foreign investment returns between 2006 and 2011.
But available data show that Africa’s foreign direct investment (FDI) flows dropped 16% in 2020 due to the effects of the pandemic. But things are gradually looking good again. DW reported that Africa’s economic output recorded a 3.5% growth in 2021. The ease of Covid-19 restrictions and commodity price rebound are factors behind the recovery. With many African countries recovering from the global pandemic, the region is ripe for investments.
2 . Secondly, AVAILABILITY OF RAW MATERIALS
A report by the United Nations Environment Programme shows that Africa is rich in natural resources and raw materials. The report further disclosed that the continent is home to 40% of the world’s gold and 30% of mineral reserves. According to Aljazeera, Africa holds a strategic position with oil and natural resources on the global map.
Africa has also been described as the fastest-growing continent for foreign direct investment, ideal for investors. With raw materials like uranium, diamonds, petroleum, iron, and gold in Africa, investors can benefit from it.
3 . Thirdly, RELATIVE POLITICAL STABILITY
According to a recent report by The Global Economy, the political stability index in Africa stands at. The report revealed an average based on 53 countries at -0.68 points, making the region’s political environment relative. With countries like Mauritius, Botswana, Cape Verde, Namibia, as well as Seychelles taking the lead, investors can leverage the relative political stability in Africa to make fortunes. While many African countries need to improve their political environment and leadership, the region indeed remains a hotspot for investments.
4 . Also, CONSUMER INCREASED DEMAND
Available report by World Data Lab describes Africa as a growing middle class. Data from the European Commission’s knowledge for policy also discussed the importance of the middle class in emerging economies such as Africa. The data disclosed that business models targeting consumers at the bottom of the income pyramid should consider emerging economies.
Investors with consumer-oriented business models should consider Africa in order to benefit from the growing middle class. According to Brookings Institute, the continent presents exciting retail as well as distribution business opportunities.
5 . Lastly, Flourishing Entertainment Industry
Available data on Billboard indicates that the African entertainment industry is now on the world stage. The report further regarded Africa as a significant player in the entertainment industry globally. Investors can benefit from a host of entertainment industry power players traveling to Africa for December festivals. Africa has renowned artists with credibility from cinema to music, making the continent ideal for a wise and strategic investor.
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