Assuming a gradual strengthening of the world economy and improvements in political and social stability in those African countries currently affected by conflicts, the African continent is set to record a projected +5% economic growth in 2015. Yogesh Gokool, head of international banking at AfrAsia Bank, looks at what 2015 holds for Africa and its economies. Foreign direct investments (FDI) and external financial flows play an increasingly important role in Africa’s development and economic growth prospects. Equally important is improved institutional performance and better governance. So, what are we going to see in 2015?
There will be more foreign investments and remittances from non-OECD (Organisation for Economic Co-operation and Development) countries that will continue to underpin the positive trend. For instance, the cash-rich Japanese and South Korean corporates will focus on acquisitions in Africa. Global investors will pool their assets in specialised structures in order to fund infrastructure projects in Africa, supporting and facilitating trade activities amongst African member states.
Although resource-rich countries will remain the prime destination for FDI’s into Africa, manufacturing and services will attract an ever increasing share of the 750+ new greenfield FDI projects.
Should commodity prices recover from its current lows; the growth outlook will be robust. […]