The African Development Bank (AfDB) has said opportunities for investment in Africa outweigh the obstacles.
In its first Africa-to-Africa (A2A) Investment Report, AfDB unearths the realities African firms face when investing on the continent, the emerging trends in A2A investment and steps African policymakers could take to accelerate intra-African investment.
The report says African firms have confidence in the continent’s long-term growth potential.
Reacting to the report yesterday, Malawi Investment and Trade Centre (Mitc) chief executive officer Clement Kumbemba said more African firms are also interested to invest in the country because of proximity and familiarity with the continent’s trading culture.
The report has found that the firms are at the cutting edge of their industries and are capitalising on their knowledge of local markets to generate higher returns and impact.
The A2A report aims to take the conversation on investing on the continent a step further while showing what African multinationals are doing to drive investments in Africa, how they are expanding their African footprint and gives insights into how to scaleup investments.
“As global foreign direct investment to Africa falls, intra-African investments are picking up pace. Africa’s big companies are increasingly on the move and expanding their African footprint.
“It is through more investments that the continent can build inclusive, sustainable growth and development. We have made this our collective commitment in the High 5s,” reads the report in part, quoting AfDB group president Akinwumi Adesina.
In an interview Monday, Kumbemba said Malawi is getting many business leads from South African firms.
“Generally speaking, most African companies are familiar with our culture and language which reduces cultural shock levels,” he said.
On his part, Ministry of Industry, Trade and Tourism spokesperson Wiskes Nkombezi agreed with AfDB’s observations, saying Malawi has opportunities for African firms to exploit.
He said more African firms are now investing in different sectors such as banking and insurance.
The A2A report features eight publicly-listed and privately-owned African companies operating in consumer services, finance, industry, media and diversified portfolios and investment, with home bases in North Africa (Morocco), West Africa (Nigeria, Togo), East and Central Africa (Ethiopia, Kenya) and Southern Africa (Mauritius, South Africa).
Highlights from the report’s intra-African investment stories include the importance of having a clear long-term vision, getting up-to-date investment facts, building local partnerships to deliver on the ground and tapping into talent in the local labour force.