Shifting geopolitics are reconfiguring Africa’s attractiveness to foreign direct investment, according to a report released Thursday.
The report by Jersey Finance, a South African fund management firm, noted that with increasingly stable African political economies, the continent’s high-yielding opportunities do not look so risky anymore from a Western perspective in the hunt for diversification.
Noting that investors are looking for a hedge against uncertainties resulting from Brexit and COVID-19, the report said “in relation to offshore, now investors want jurisdictions that are credible and transparent, with robust regulation.”
It showed that the COVID-19 crisis has set things back considerably.
“COVID-19 is affecting everything. It is affecting fund-raising for new funds. It remains to be seen how long the industry can function remotely and how the long-term macro effects will play out,” one fund manager said.
“As the world settles into the reconfigured working patterns in the wake of the global COVID-19 pandemic, there may be a deep economic crisis even if capital again begins to flow to stimulate recovery,” the report said.