Foreign Direct Investment (FDI) flow into Sub-Saharan Africa shot to a record high of $35.0 billion in 2011 from the $27.4 billion posted in 2010. Out of this, West Africa received a 46 per cent.
According to the Economics & Political Research Unit of Renaissance Capital, West Africa was the largest recipient of FDI in 2011, followed by Central Africa with 24 per cent and Southern Africa with 18 per cent of inflows. East Africa received a meager 11.3 per cent of SSA’s FDI inflows.
Ghana, Nigeria and South Africa collectively attracted half of the 2011 FDI making up 75 per cent of the sub-region’s inflows, concentrated within the petroleum industry.
Ghana, Africa’s newest oil producer, drew FDI for the newly developed Jubilee oil field. Tullow Oil, a UK oil company, plans to invest $2 billion in 2013 and 2014 and plans to establish an oil refinery in Uganda. Nobile Energy, a US oil company, plans to invest $1.6bn to set up production wells and a processing platform in Equatorial Guinea.
FDI to West Africa increased by 36 per cent to $16.1 billion in 2011, with Guinea’s exhibiting the strongest improvement in FDI growth last year. According to the United Nations Conference on Trade and Development (UNCTAD), this trend would continue over the medium term owing to the $ 6 billion that the state-owned China Power Investment Corporation plans to invest in bauxite and alumina projects.
Liberia, Guinea and Ghana were the sub-region’s largest recipients of FDI with 44 per cent, 17 per cent and 9 per cent respectively.