Economic crisis will squeeze investment in Africa

Africa will in coming months have to work hard to retain its investment while making fewer demands as the economic crisis continues to hit home. This was just one of the predictions by Control Risk, a global business risk consultancy which launched its annual RiskMap in South Africa last week. According to Chris Melville, Control Risk Analyst for Central Africa, various factors will impact on investment on the continent in coming months. “Social and civil unrest remains a concern, while issues of succession will become even more important in 2009 as will stable elections. “While elections are not really a source of worry in Africa with only three countries in turmoil following elections last year compared to seven where there was no issue, it is something to be taken into account.” Melville said the elections in Kenya, Zimbabwe and Ghana were all cause for concern as they had several characteristics in common including the fact that there was more advanced competitive politics and excessive optimism from all the participants that they would win. “Now we are not saying that a Kenyan situation is going to repeat itself, but there are 12 elections taking place in Africa this year and of those Malawi, Namibia and South Africa share very similar characteristics with Kenya, Ghana and Zimbabwe.” He said this could lead to protracted political crisis in the countries, but that firm decision-making and leadership would be key in coming months to ensure stability.