Although global foreign direct investment (FDI) fell by 21% in 2002 to $651-billion, the lowest since 1998’s $686-billion, 30 out of 53 African countries attracted higher inflows in 2002 than in 2001, according to the latest World Investment Report (WIR) from the United Nations Conference on Trade and Development (UNCTAD).
The global FDI decline was spread unevenly, with 108 out of 195 economies experiencing a decline. The main factor behind the decline was slow economic growth and dim prospects for recovery.
Although the recorded FDI flows to Africa fell by 41% to $10,998-billion from $18,769-billion in 2001, if the exceptional De Beers/Anglo American deal and one in Morocco are excluded, then there was no decline and on par with the $8,489-billion in 200 and the $12,231-billion of 1999.
The main sectors for African FDI were petroleum (Algeria, Angola, Chad, Equatorial Guinea, Sudan and Tunisia) and clothing (Botswana, Kenya, Lesotho and Mauritius).
The top five African recipients ranked in order were Angola, Nigeria, Algeria, Chad and Tunisia. Chad had the largest increase as it went from zero to $900-million.
South Africa’s inward FDI fell to only $754-million in 2002 from $6,789-billion in 2001, $888-million in 2000, $1,502-billion in 1999 and $561-million in 1998.
In terms of attracting FDI, South Africa performed below potential with a ranking of 83 compared with its inward FDI potential ranking of 72. – I-Net Bridge