Business
Top five African countries to invest in 2023
Africa holds tremendous promise for investment. It is a continent that has huge economic potential and that offers many rewarding opportunities.
Africa’s natural resources make it an economic powerhouse. The Democratic Republic of the Congo has the world’s largest cobalt deposit, and cobalt is a key factor in producing the lithium-ion batteries used in smartphones, electric cars and many other devices. Africa also has huge supplies of gold, titanium, copper, diamonds, salt, phosphates and sulfur.
The continent also has one of the world’s fastest-growing consumer bases. Given the current urbanization rates across the continent, household consumption in Africa could rise as high as $2.5tn by the end of the current decade. So, whether you want to invest in the JSE top 40 or are looking at other forms of African investment, here are five countries on the continent of Africa that deserve your attention:
Nigeria
Nigeria boasts the third-highest level of foreign investment in Africa, and the nation is a key focus for experienced investors worldwide.
The GDP of Nigeria in the second quarter of 2022 showed growth of 3.54%, compared to a growth rate of 3.11% in the first quarter of 2022. Most of that growth did not come from the well-known oil sector, which contributed only 6.33%. Communication, data and services accounted for a tenth of the output, as did the combination of natural gas, agriculture and crude petroleum. Manufacturing and construction also continued to thrive way beyond the levels of most major global economies.
Egypt
Egypt is a geographical area with robust economic growth and streamlined business formation procedures. It is a very attractive location for foreign investors in several ways.
Egypt’s economy has indicated exceptional performance, resiliency and the ability to absorb downturns, with a substantial capacity to attract new capital. Investment in Egypt increased by 183% during the initial quarter of 2022, from $1.4bn in 2021 to $4.1bn.
Egypt’s plan for 2022/2023 calls for urban development sector investments totaling EGP 294.2bn. Specifically, investment is required in the sewage system, water treatment and construction sectors.
South Africa
The South African economy is the most developed and diverse in sub-Saharan Africa. Stable institutions strengthen the business climate, while an independent judicial system and legal sector honor the law, and a free press and well-developed financial system all contribute to this positive environment.
South Africa has attracted considerable US investment thanks to the perception that it is a relatively low-risk African location. In 2020, Google (US) invested roughly $140m and PepsiCo $1.5bn, while Ford announced a $1.6bn investment.
Overall, South Africa offers a unique combination of first-world financial infrastructure and a huge emerging market economy.
Ghana
Ghana is among the most stable democratic nations on the African continent, and political stability ensures long-term investment stability.
Ghana aims for 5.8% GDP growth, which is driven primarily by cocoa beans, petroleum products and mineral production. Ghana has the fastest-growing economy in Africa, and its rate of economic growth continues to outpace analysts’ forecasts.
During the first quarter of last year, overall GDP increased by 3.3%, although this was a decrease from the comparable period in 2021, when it grew by 3.6%. Fiscal pressures have remained elevated, but the government has begun discussions with the IMF on a potential program to address outstanding issues, and Ghana continues to be a location with enormous potential.
Algeria
Algeria’s foreign exchange reserves earned through oil and gas provide enormous opportunities for economic expansion. A development strategy that focuses on stronger, sustainable growth could generate more jobs, especially among young Algerians, and could alleviate the nation’s housing shortage.
Algeria’s GDP is projected to reach $165bn by the end of 2022, and $170bn by the end of 2023, which clearly shows the nation’s growth potential.
Algeria’s economy is dominated by the export of petroleum and natural gas, which make a contribution worth roughly one-third of the country’s GDP annually despite volatility in global prices. The national government is pushing ahead with diversifying the economy, beginning with the non-oil sector, while at the same time intensifying the structural transformation reforms to underpin future growth.
Summary
While Africa continues to face challenges, the strongest nations on the continent are demonstrating huge potential for further growth, and global investors looking to invest in a region with a rapidly growing consumer base should consider these five nations as starting points for African investment.
The Board stated this in a statement released by its Corporate Communications Directorate to newsmen, recently, during the inauguration of 140 trainees for the Train 7 Project.
The trainees had undergone the Nigerian Content Human Capacity Development (NC-HCD) programme it organised in partnership with the Nigeria Liquefied Natural Gas (NLNG) Limited in Port Harcourt, the Rivers State capital.
The Tide gathered that the training programme was an intensive three-month Advanced NC-HCD Programme for the US$5 billion NLNG Train 7 Project on Bonny Island, Rivers State.
The trainees, The Tide further learnt are graduates in different academic disciplines who have completed a 12-month Basic Training Programme in diverse oil-and-gas-industry-related skill sets and are now set for an on-the-job phase which includes active hands-on participation in operational areas such as Turn Around Maintenance (TAM), Commissioning, and Desktop Programmes.
The Corporate Communications Directorate of the NCDMB told The Tide that in November 2024, a set of 331 trainees under Batch A of the NLNG T7 HCD Training Programme began capacity development in facility management, engineering, Information and Communication Technology (ICT), Health Safety and Environment (HSE), Quality Assurance and Quality Control, as well as welding and fabrication.
According to the Board, additional 77 trainees under Batch B of the same Training Programme began capacity development in data analytics and supply chain management among several other fields relevant to the operations of the oil and gas industry.
While addressing the trainees and trainers who were drawn from the Oil and Gas Trainers Association of Nigeria (OGTAN), Management Personnel of the NCDMB and NLNG, the Executive Secretary of NCDMB, Engr Felix Omatsola Ogbe, said the Advanced NC-HCD training is more than a milestone.
“The NC-HCD training programme is an expression of the collective commitment of the Board and the NLNG to nurturing world-class Nigerian professionals who will shape the future of our oil and gas industry.
“The Board has remained steadfast in its conviction that Human Capital Development is a critical investment in the sustainability and competitiveness of Nigeria’s oil and gas value chain”, the NCDMB boss said.
He said the situation has resulted in widened knowledge gaps and operational challenges.
As a globally regulated sector, he said it was important that stakeholders put measures in place to attract the talents required to move the industry forward.
Keyamo, therefore, called on stakeholders in the industry to be deliberate in identifying, encouraging, nurturing and harvesting young talents to ensure a sustainable supply of manpower to the aviation sector.
Director of Public Affairs and Consumer Protection of the FAAN, Mrs Obiageli Orah, in a release made available to aviation correspondents, noted that the Minister deemed it necessary to attract the right quality of human resources required to move the sector forward.
“As a globally regulated sector, it is important that stakeholders put measures in place to continually attract the right quality and quantity of human resources required to move the industry forward.
“It is important to note that organising training programmes are avenues through which we can breed, nurture, and harvest such human resources.
“One of the critical challenges facing the industry is the ageing and retiring workforce, leading to widened knowledge gaps and operational issues.
“Training programmes, I believe, is among other things designed to make aviation appealing to the younger generation, while encouraging them to develop interest in taking up a career in the industry”, the statement stated.
Meanwhile, some aviation stakeholders have expressed concerns of countless young Nigerians who seek to make their mark in aviation, tourism, and the wider transport ecosystem but often face steep barriers to entry.
According to them, lack of access, limited mentorship, financial constraints, skill mismatches, and systemic gaps, among others, have posed some constraints to them.
The Tide gathered that by the appointment, Ogbe becomes Nigeria’s representative on the Board of the 18-member continental body, which has its headquarters at Brazzaville, Republic of the Congo.
Ogbe was picked for this role by the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, who doubles as the Chairman of the NCDMB Governing Council.
The notice of the Executive Secretary’s appointment was conveyed in a congratulatory letter signed by the Director of Support Services, APPO, Mrs. Philomena Ikoko, on behalf of the Secretary-General of the organisation, Dr. Omar Farouk Ibrahim.
She applauded the NCDMB boss on the confidence reposed in him by the Minister, expressing her belief that he would make immense contributions to the development of the African oil and gas industry.
Mrs Ikoko stated that Ogbe was joining the Executive Board of APPO at a challenging time for the oil and gas industry, especially in Africa.
“Your appointment is a major call to duty for Nigeria and the continent. The secretariat will give you the support you will need to make a success of your assignment”, she said.
According to a statement by the Directorate of Corporate Communications and Zonal Coordination, the NCDMB played key roles in catalysing the operations of APPO and the development of local content in Africa.
The statement added that the board was providing institutional support and mentorship to several oil producing countries in their formulation of local content policies.
“The NCDMB initiated the African Local Content Roundtable (ALCR) and hosted the inaugural edition in Yenagoa, Bayelsa state, in June 2021, and the event was attended by key officials of APPO and other oil industry players.
“The idea for the Africa Energy Bank (AEB) was mooted by NCDMB’s officials at the event, as one of the strategies that would accelerate the growth of the African oil and gas industry and deepen local content.
“The Board also collaborated with APPO to host subsequent editions of the African Local Content Roundtable (ALCR), including the 2023 edition held at Abuja.
“The Africa Energy Bank, which APPO is setting up at Abuja, is aimed at pooling financial resources needed to fund big-ticket oil and gas projects across the continent, and bridge funding challenges currently impeding the development of the sector”, the NCDMB’S said.
Meanwhile, the APPO Secretary-General has said the Africa Energy Bank seeks to fund oil and gas projects across economies in Africa and help to plug critical financing gaps that exist through the continent’s over reliance on financiers from the West.
He added that each APPO member country is expected to raise $83 million with an objective of raising $5 billion capital for the establishment of the Bank.
The Tide learnt that recently Nigeria, Angola and Ghana have contributed their share capital for the African Energy Bank, which represents 44 percent of the trio’s contributions to the minimum capital that is required from oil producing countries in the continent.
It would be recalled that at the Nigerian Oil and Gas Opportunity Fair (NOGOF) held recently, the NCDMB’s Scribe confirmed that the agency was part of key institutions that pooled resources for the formation of the Africa Energy Bank.
Ogbe announced that the Bank will open for business before the end of the 2nd quarter of this year, 2025, expressing hope that it will create more funding availability for local oil and gas projects and companies.
Similarly, the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, had stated at the Offshore Technology Conference that Afrexim Bank has already raised $19billion for the take-off of the Africa Energy Bank.
According to him, $14 billion out of the funds represents the bank’s financial exposure on African oil and gas projects, with the additional $5 billion as take-off capital.
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