![\"FDI](\"http:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2014\/05\/FDI-by-sector.png\")
<\/a>FDI by sector<\/p><\/div>\n
Retail and consumer products accounted for 17% of projects in 2013, followed by financial services, accounting for 15%. Metals and mining fell to 2%, from 13% in 2007.<\/p>\n
The report combines an analysis of international investment into Africa since 2003, with a 2014 survey of over 500 global business leaders about their views on the potential of the African market.<\/p>\n
The latest data shows that while there has been a decline in FDI project numbers from 774 in 2012 to 750 in 2013, primarily due to ongoing uncertainty in North Africa, they remain easily in excess of the pre-crisis average of 390 projects per year.<\/p>\n
There is a noticeable divide between FDI trends in North Africa versus Sub Saharan Africa (SSA). While FDI projects in North Africa declined by nearly 30%, projects in SSA increased by 4.7%, reversing the decline of 2012. This further widened the gap between the two sub regions, with SSA\u2019s share of FDI projects exceeding 80% for the first time.<\/p>\n
<\/a>Sub Saharan Africa attractiveness<\/p><\/div>\n
New FDI hotspots<\/strong><\/p>\n According to E&Y, investors are looking beyond the more established markets of South Africa, Nigeria and Kenya to expand their operations, as well as moving into more consumer-related sectors as Africa\u2019s middle class expands.<\/p>\n There was significant movement in the list of top 10 countries by FDI projects in 2013. Only South Africa and Nigeria retained their first and third positions from 2012 with 142 projects and 58 projects, respectively.<\/p>\n However, FDI projects in both these countries witnessed a slight decline. Countries such as Kenya with 68 projects, Ghana with 58 and Mozambique with 33 all moved up the ranks.<\/p>\n Zambia and Uganda were the new entrants in the top 10 list in 2013 with 25 and 21 projects respectively, an increase of more than 20%. In contrast, North African countries such as Morocco, Tunisia (ranked 8th in 2012) and Egypt slipped on the rankings.<\/p>\n Foreign investment<\/strong><\/p>\n The UK became the clear leader in 2013 with 104 projects, while the US fell from joint first place to second place with 78 projects, a 20% decline from last year. South Africa, the third largest investor, directed 63 investment projects into the rest of Africa, a 16% decline on last year but a significant increase from pre-crisis levels when it registered on average 12 projects.<\/p>\n Intra-African investment is gaining momentum, E&Y noted. African investors nearly tripled their share of FDI projects over the last decade, from 8% in 2003 to 22.8% in 2013.<\/p>\n FDI source and destination<\/p><\/div>\n A move towards consumer<\/strong><\/p>\n The top three sectors \u2013 technology, media and telecoms (TMT) with 150 projects, retail and consumer products (RCP) with 131 projects and financial services with 112 projects \u2013 accounted for more than 50% of the total projects in 2013.<\/p>\n Urban centers<\/strong><\/p>\n Africa\u2019s cities are now emerging as the hotspots of economic and investment activity on the continent. Nearly 70% of respondents stressed the significance of cities and urban centers in their investment strategy in Africa.<\/p>\n In terms of perception, city attractiveness closely maps country appeal. In SSA, half of the respondents quote Johannesburg as the most attractive city in which to do business, ahead of Cape Town. Nairobi and Lagos are ranked as third and fourth most attractive cities, respectively. In North Africa, Casablanca, Cairo and Tunis are perceived as the top three cities in which to do business.<\/p>\n<\/a>