Investors Flock Seychelles, Mauritius Over Favourable Investment Terms

Seychelles and Mauritius have emerged as the top investment destinations in Africa, outperforming the continent in terms of economic performance, market accessibility, investment climate, and social and human development, according to the latest report by Rand Merchant Bank (RMB).

This ranking brings into light the ideal challenges faced by other major economies in Africa like Kenya and South Africa.

Top Investment Destinations

RMB’s report, published on August 6, 2024, evaluated 31 African nations, placing Seychelles and Mauritius at the forefront.

They have showcased robust economic performance and favorable investment climates, making them attractive to investors looking for stable and promising opportunities.

Top Ten Investment Destinations

According to the report, the top ten countries are Egypt, South Africa, Morocco, Ghana, Tunisia, Senegal, Nigeria, and Algeria.

Each of these nations has shown varying strengths in different aspects, contributing to their overall rankings.

Challenges for South Africa

South Africa, once a leading investment destination, has seen its attractiveness decline due to weak economic indicators.

Also Read: President Kenyatta responds to Pandora Paper Expose

S.A’s ranking slipped by one place from a previous survey conducted in 2021. Despite this, South Africa still ranks high for market accessibility and innovation, indicating its potential for improvement.

Persistent global inflation has forced central banks to maintain high interest rates, which has kept the cost of funding elevated for African borrowers.

This economic environment has posed challenges for several countries on the continent, affecting their investment attractiveness.

Egypt’s Economic Potential

When measured by economic performance and potential alone, Egypt tops the rankings.

The country’s strong economic fundamentals and growth prospects have made it a leading destination for investors focusing on economic performance.

Kenya’s Decline

Kenya, which previously featured in the top ten, has dropped to 11th place in the latest rankings.

The decline is attributable to the dynamic nature of investment climates and at a time when anti-government protests have taken centre stage by the youth over taxation and governance policies.

Fitch Ratings has downgraded Kenya’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to ‘B-‘ from ‘B’, while maintaining a Stable Outlook.

The downgrade by Fitch Ratings comes in the wake of the Kenyan government’s decision to retract revenue measures included in the Finance Bill 2024, a move triggered by widespread violent social protests.