South Africa remains a top FDI destination

Freight volumes, including project cargo, are due to continue growing in South and southern Africa. International investors still see South Africa as one of the top African countries in which to put their money, according to the 2013 Unctad Global Investment Trends Monitor report. The report by the United Nations Conference on Trade and Development estimates that foreign direct investment (FDI) inflows to Africa rose by 6.8% to an estimated US$56.3 billion in 2013. “This was due to the strong performance of southern African countries, including South Africa and Mozambique that experienced record inflows of more than US$10 billion and US$7 billion respectively, as well as lower levels of divestment in Angola compared to previous years. “The other sub-regions saw their inflows decrease,” says the report. On a global level this compares with an 11% rise in FDI flows, to an estimated US$1.46 trillion – a level comparable to the pre-crisis average. However, developed countries remain trapped in an historically low share of global FDI, accounting for only 39%. Southern Africa and Asia seem to hold the most promise for logistics companies wanting to expand their footprint out of Europe. “Persistent political and social tensions continued to subdue flows to North Africa, where only Morocco registered solid growth of 24%, to US$3.5 billion,” says the report. “Nonetheless, there are signs that investors are ready to return to the region, with many big cross-border deals targeting Egypt.” In sub-Saharan Africa, Nigeria’s “lacklustre performance (US$5.5 billion)” is the result of foreign transnational corporations’ retreat from the oil industry, it says. South Africa is also leading FDI in the BRICS – Brazil, Russian Federation, India, China and South Africa. Their current share of global FDI flows at 22% is twice that of their pre-crisis level. Total inflows to the five leading emerging economies reached US$322 billion in 2013, 21% higher than in 2012. South Africa outperformed other countries within the group, with FDI inflows rising by 126%. INSERT 6.8% The increase in FDI Flows into Africa in 2013.