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Nigeria has been recognized as the ninth most investable country in Africa for 2024, according to the latest “Where to Invest in Africa” report by Rand Merchant Bank (RMB).
This comprehensive report evaluates investment climates across the continent, awarding Nigeria a score of 0.163. The assessment considers four key pillars: economic performance and potential, market accessibility and innovation, economic stability and investment climate, and social and human development.
In this year’s rankings, Nigeria is positioned behind Seychelles, Mauritius, Egypt, South Africa, Morocco, Ghana, Tunisia, and Senegal, with Algeria completing the top ten.
The report offers a detailed analysis of Nigeria’s investment climate. Although the country remains Africa’s largest economy by GDP, recent currency devaluation has affected its standing, placing it third in economic size. Despite its significant economic footprint, Nigeria’s overall investability is moderated by several factors, contributing to its ninth-place ranking.
“Nigeria has a GDP of $375 billion and the continent’s largest population of nearly 220 million people,” the report highlights. “However, its GDP per capita score is only middling, ranking 15th in our model. The country’s economic complexity is also a challenge, with its heavy reliance on oil exports reflected in its 29th position for economic complexity. Petroleum and crude oil constitute nearly 70% of its trade flows.”
The report also notes Nigeria’s politically challenging environment, which can be a deterrent for investors. Nevertheless, it acknowledges the country’s progress in creating a more favorable business environment. Nigeria’s ranking on the World Bank’s Ease of Doing Business index improved from 169th out of 190 countries in 2016 to 131st in 2020, reflecting efforts to enhance its investment appeal.
Despite the challenges, Nigeria is classified among the “Highflyer” countries in the report, which includes large, well-established economies offering stability and diverse investment opportunities. This group also features South Africa, Egypt, and Ethiopia. Other African nations are categorized into groups such as “Cleared for Take-off,” “People Potential,” “Global Connectors,” and “Low-Base Boomers,” each representing different growth trajectories and investment risks.
Isaah Mhlanga, Chief Economist at RMB, emphasized the complexity of analyzing Africa’s diverse markets. “Africa’s rich diversity presents a challenge in fully analyzing its nuances, but it’s crucial for understanding the varied markets within this vast regional economy,” Mhlanga explained. “The 2024 RMB Where to Invest in Africa report provides a balanced, robust, and actionable view of the drivers, challenges, and opportunities across the 31 African markets included in the analysis.”
As Nigeria continues to navigate its economic and political landscape, the report highlights both the opportunities and challenges that shape its role as a leading investment destination in Africa.
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