Business Economy

Nigeria Is Africa’s Third Most Attractive Destination for FDI – Report

The Absa Africa Financial Markets Index 2021 (AAFMI) has ranked Nigeria as the third most attractive country in Africa for foreign investment.

The AAFMI surveyed 23 countries in Africa and used six pillars to rank their openness and attractiveness to foreign investment. It stated that Nigeria scored 63 points to occupy the third position while the first and second position went to South Africa and Mauritius, which scored 86 and 70 points respectively.

The six pillars were market depth; access to foreign exchange; market transparency, tax and regulatory environment; capacity of local investors; macroeconomic opportunity; and enforceability of financial contracts.

Nigeria’s performance across the six pillars were: market depth, 62; access to foreign exchange, 20; market transparency, tax and regulatory environment, 86; capacity of local investors, 44; macroeconomic opportunities, 69 and enforceability of standard master agreement, 100.

The report stated that nine countries in the index, including Nigeria, have introduced products that could be classified as green or sustainable and emphasised that, “green bonds are the most popular instrument, being at investors’ disposal in seven countries.”

The AAFMI evaluated financial market development in 23 countries and highlighted economies with the most supportive environment for effective markets. The aim was to show present positions, as well as how economies could improve market frameworks to bolster investor access and sustainable growth.

The 2021index was produced by the Official Monetary and Financial Institutions Forum (OMFIF) and sponsored by Absa Group Limited. It showed that only seven countries scored up to 50 basis points against 14 countries that reached 50 points last year. ABSA is a South African-based financial services group,

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