Investor confidence in South Africa has grown steadily in the past year, with foreign direct investment (FDI) increasing, according to a study.
Consulting firm ATKearney has released a study highlighting the country’s growing attraction for foreign investors, with South Africa moving up two places to number 13 from number 15 in 2013 on its Foreign Direct Investment Confidence Index.
South African ranks higher than Switzerland, Sweden, Japan, Belgium and the Netherlands.
According to the company the increase in confidence can be partially attributed to a US$550 million five-year investment by United Kingdom (UK)-based BP in its oil refinery and service station assets in the country.
“BP will partner with South African retail giant Pick n Pay to open 120 Pick n Pay Express stores across the country,” ATKearney said.
It said Google’s investment in renewable energy in the Northern Cape also contributed to growing confidence.
“While not particularly large deals, these moves are a positive sign for a country with volatile FDI figures, the result of the preponderance of larger M&A [merger and acquisition] deals,” the consulting firm said.
HumanIPO reported last month technology, media and telecommunications projects in Africa received 20 per cent of all FDI.
According to Ernst & Young’s Africa Attractiveness Survey 2014 the average size of FDI projects increased to US$70.1 million in 2013, from US$60.1 million in 2012.
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