Nairobi, Kenya – the country’s financial center (Wikipedia)
Kenya overtook South Africa to become the biggest investor in other African countries in terms of the number of projects in 2015.
Kenya invested in 36 projects last year in other parts of the continent against South Africa’s 33, a new study by financial consulting firm Ernst & Young shows.
It noted that most of Kenya’s intra-Africa investments went into countries within the East African Community (EAC).
The study said Kenya’s global ranking as a source of foreign direct investment (FDI) to the African continent also improved strongly to seventh position in 2015 from 13th in 2014.
“Activity was largely concentrated in services, with financial and business services together accounting for nearly 78 percent of FDI projects originating from Kenya,” said the report released Monday.
“Many Kenyan companies are playing the role initially adopted by South Africa’s corporate sector, who were the first to venture outside their home markets,” it adds.
South Africa, however, beat Kenya in terms of the worth of the projects as it had $1.97 billion compared with Kenya’s $99 billion.
In the past decade, Kenyan banks and retail businesses, for example, have ventured into the region, including in the volatile South Sudan and Somalia.
“East Africa is the primary destination for Kenyan investors, in line with overall sub-regional integration plans,” said the study.
It further shows that Africa attracted FDI from a diverse and growing group of investors.
In 2015, the US retained its position as the largest investor on the continent, despite a four per cent fall in FDI projects.
Historical investors, including the UK, France, the UAE and India, expressed renewed interest in Africa.
Other notable investors in Africa were Italy and Luxembourg, which became among the largest 15 investors in 2015.
Overall, intra-African FDI projects rose 2.8 percent in 2015, with capital investment up 6.2 percent.
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