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Nigeria Ranks 9th In Top 10 Most Promising African Countries For Investment

By Odunmorayo Oke

07 August 2024   |   1:46 pm

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Africa's economic potential is often overlooked compared to the booming growth seen in parts of Asia and North America. Countries like the United States, Vietnam, China, and Mauritius have gained reputations for their fast-growing millionaire populations and boisterous economies. However, a new report from Corporate and Investment Rand Merchant Bank suggests that Africa may be…

Africa’s economic potential is often overlooked compared to the booming growth seen in parts of Asia and North America. Countries like the United States, Vietnam, China, and Mauritius have gained reputations for their fast-growing millionaire populations and boisterous economies.

However, a new report from Corporate and Investment Rand Merchant Bank suggests that Africa may be a hidden gem for investors. The report, which assessed 31 African countries, reveals the continent’s most promising destinations for investment in the years ahead.

How the report was made

The report analysed the countries across a range of metrics including gross domestic capita (GDP), GDP per capita, economic growth, population size and dynamics, urbanisation, economic complexity, innovation, trade, financial stability, economic freedom, political stability, and human development indicators.

Nigeria’s prospects

Nigeria, with its massive $375 billion GDP and population of nearly 220 million, was ranked 9th overall on the list.

While Nigeria’s sheer economic size is a major draw for investors, the report notes that the country’s amateurish GDP per capita ranking of 15th, as well as its heavy reliance on oil exports, which account for nearly 70% of its trade, have somewhat limited its investment appeal.

The report also highlighted Nigeria’s political complexity as a key factor, with the nation’s alternating presidency between the Christian south and Muslim north, as well as ongoing security challenges posed by insurgent groups, creating a sometimes challenging business environment.

However, the report also emphasised that for those investors able to navigate Nigeria’s complexities, the potential rewards can be substantial. “Great benefits are available to those who succeed” in Nigeria, the report stated.

The top 10 most promising African countries for investment, according to the RMD report, are:

1. Seychelles 0.72
2. Mauritius 0.69
3. Egypt 0.49
4. South Africa 0.33
5. Morocco 0.30
6. Ghana 0.27
7. Tunisia 0.20
8. Senegal 0.18
9. Nigeria 0.163
10. Algeria 0.158

The report noted that the small island nations of Seychelles and Mauritius topped the list due to their high economic freedom. As well as high innovation, and human development, despite the limitations of their small populations and economies.

Overall, the RMD report shows the different investment opportunities across the African continent. For investors willing to do their due diligence, Africa presents compelling long-term prospects.