Harare – South Africa still ranks as the most attractive economy for investments destined for the continent despite challenges emanating from slow growth, a gloomy ratings outlook and waning perceptions, EY said in an index released Wednesday.
The auditing and advisory company has also predicted a tough few years ahead for the continent. The global economy is struggling for growth amid slowing down commodity prices and a less rosy outlook for China’s economic transformation and growth outlook.
EY ranks South Africa, the region’s most industrialised and second largest economy, as the most attractive investment destination in Africa in its Africa Attractiveness Index. Morocco, Egypt, Kenya and Mauritius are ranked second, third, fourth and fifth respectively.
“Despite macroeconomic challenges (and a low-growth environment), South Africa still outperforms most other African economies due to relatively high scores across every other dimension (partly a reflection of the fact that the South African economy is more developed than any other African economy),” EY said.
A weaker rand currency has also hobbled South Africa, although this is a problem that is shared with most regional peers such as the Malawi kwacha and Nigerian naira.