Morocco has overtaken South Africa to become Africa’s fourth-most attractive investment destination, as years of industrialisation, export diversification and infrastructure investment help the North African country gain ground on the continent’s largest economy, according to Rand Merchant Bank (RMB), a subsidiary of FirstRand Ltd.
- Morocco has surpassed South Africa to become Africa’s fourth-most attractive investment destination.
- Morocco’s manufacturing strength, macroeconomic stability, and strong foreign investment are driving its rising status as a continental business hotspot.
- South Africa’s economic reforms and robust financial markets are noteworthy, but slower growth has caused it to slip in the latest rankings.
- Nigeria has made a significant comeback, jumping seven spots after economic reforms like subsidy removals and foreign-exchange liberalisation sparked renewed investor optimism.
Morocco’s growing appeal is driven by its emergence as a major manufacturing hub, particularly in the automotive industry, alongside macroeconomic stability and its ability to attract substantial foreign direct investment.
“The country has emerged as one of Africa’s leading manufacturing hubs, particularly in automotive production, while maintaining macroeconomic stability and attracting substantial foreign direct investment,” the report said.
South Africa, which has long been one of the continent’s leading investment destinations, continues to benefit from deep financial markets, improving energy security and ongoing economic reforms. However, slower growth has cost it ground in this year’s rankings.
Nigeria and Côte d’Ivoire climb the rankings
Nigeria recorded one of the most notable improvements, climbing seven places after a difficult period of economic adjustment. RMB attributed the country’s progress to growing confidence that reforms, including fuel subsidy removal, foreign-exchange liberalisation and broader macroeconomic adjustments, are laying the groundwork for more sustainable growth.
Although investors remain divided over the pace of Nigeria’s recovery, the report noted that there is greater clarity about the country’s economic direction.
Côte d’Ivoire also continued its upward trajectory, rising from 16th place two years ago to seventh this year. Its progress reflects strong economic growth, infrastructure development, disciplined policy implementation and expanding hydrocarbon production, strengthening its position as a regional economic hub in West Africa.
Seychelles, Mauritius and Egypt retain top positions
Seychelles, Mauritius and Egypt retained the top three positions for the third consecutive year, RMB said.
The report ranks 31 African countries using 20 metrics grouped into four pillars: economic performance and potential, market accessibility and innovation, investment climate, and social and human development.