Africa’s largest economy, Nigeria, has emerged as the No. 1 frontier-market economy in terms of attracting the most attention from European and American multinationals, a report titled Frontier Market Sentiment Index by Wall Street Journal (WSJ) Frontiers has revealed.
“We collect data about which countries the companies are watching for potential future investment. Over time, that gives us a clear picture of their market priorities — which countries are they including in their future plans and which they are dropping,” said Matt Lasov, global head of advisory and analytics of Frontiers Strategy Group (FSG), the U.S.-based advisory firm that created the index for WSJ.
Countries in sub-Saharan Africa dominate the list, with nine from the region making part of the 11 from Africa in the list of 20 countries.
Kenya ranked fifth on the list, making it the second African country with a 23.17 percent corporate sentiment rate, following Nigeria’s 29.57 percent. (Corporate sentiment is the percentage of companies that include a particular country on their watch-list.) Rising insurgency in both countries apparently has not discouraged multinationals from venturing into business dealings as opportunities in the countries probably outweigh security risk.
Angola followed at 21.9 percent and Ghana at 18.73 percent.
The top three African countries’ rating may not come as a surprise to many. First, Nigeria is Africa’s largest economy and is still growing; Kenya is East Africa’s largest economy; Angola’s oil wealth had in recent times made its economy bigger, with crisis-hit Portugal relying on the Southern African country as it seeks foreign investments to put its economy back on track.
“The corporate world’s fascination with Africa shows through clearly in the rates of change of sentiment,” the report said.
The report presented four sub-Saharan African countries out of the five with the highest positive change in sentiment; these countries also made up seven of the top 10.
Kenya’s sentiment change from 2013 to June 2014 was 4.18 percent; Nigeria 4.06 percent; Ethiopia 3.58 percent; Tanzania 3.73 percent; Cote d’Ivoire 3.09 percent; Angola 2.31 percent and Zambia 2.02 percent.
The report, however, said Nigeria remains the clear leader out of the African countries with twice the number of companies in the index considering investing in the West African country. “Nearly three in 10 companies have Nigeria on their watch list.”
Read the full story at ventures-africa.com