Ghana in top 10 FDI destinations in Africa and Middle East for 2014
A report released by the Financial Times unit, FDI Intelligence places Ghana among the top 10 foreign direct investment (FDI) destinations in Africa and the Middle East for 2014.
Ghana, according to the report attracted $4 billion worth of capital investment in 2014 to put it at number eight of the top 10 FDI ranking.
The report assesses global trends in Greenfield foreign direct investment trends to Europe; Asia Pacific; North America; Latin America and Caribbean; and Middle East and Africa. The report indicated that, in spite of general decline in FDI flows globally, African countries generally had the highest flow of FDI in 2014, with Egypt recording the greatest increase in FDI, with $18 billion of investment.
A major investment contributing to Ghana’s ranking is the Tema Port Expansion Project worth $1 billion. The project is being undertaken by Meridian Port Services, a subsidiary of Denmark-based AP Moller-Maersk. The port expansion involves the development of four deep-water berths and an access channel for larger vessels, increasing the port’s throughput capacity to 3.5 million twenty foot equivalent units (TEUs).
According to the authors of the report, this time last year, when they released the recap of 2013’s FDI figures, they had some modestly good news to share.
“There were strong signs that the FDI market was rebounding from the doldrums of the previous few years, and we recorded an 11 percent increase in capital expenditure on greenfield projects. After years of depressing conference attendees with all the downward-pointing graphs that we presented, it was nice to have some positive news to share,” they said.
By the latest figures the authors say 2014 was a tough year for FDI, with greenfield investment growing by only a tiny percentage and FDI hovering stubbornly below the pre-financial crisis peak.
“There were a few bright spots: faster growing economic regions, such as Africa, experienced growth in greenfield FDI in 2014 and – perhaps contrarily to what might be expected – Egypt attracted a raft of mega investment projects as the investment environment and economic prospects in this key market for the Middle East improved,” the said.
They noted that some key sectors are also showing signs of life: automotive manufacturing has witnessed a substantial rise in capital investment, and financial services saw a strong rebound with healthy growth in project numbers.
The report indicates that in 2014, greenfield FDI continued to show signs of recovery, with capital investment increasing by an estimated one percent from $642 billion in 2013 to $649 billion and job creation increasing by 17 percent to $1.84 million.
However, the report notes, the number of FDI projects declined slightly in 2014, decreasing by one percent to 12,069.
The cites China as the highest ranked destination country by capital investment, with $75 billion-worth of FDI projects announced in 2014, while the US was the highest ranked destination country by number of FDI projects, with a total of 1577 FDI projects announced in this period.
Asia-Pacific remained the leading destination for FDI in 2014, with 4153 announced FDI projects with estimated capital investment of $250 billion. The region attracted 38 percent of all capital investment globally in 2014. Western Europe was the leading source region for FDI in 2014. Despite a six percent decline in FDI projects, capital investment from the region increased one percent to $226 billion. Western Europe, Asia-Pacific and North America accounted for 91 percent of all overseas capital investment in 2014, it said.
By Dode Seidu