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Japan Sets Sights on Africa As a Top Investment Destination

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  • Japan Sets Sights on Africa As a Top Investment Destination

Focus for the longest time has been on China’s domination when it comes to investments in Africa. While true that China leads the pack when it comes to investments, Japanese investments are becoming increasingly popular as the island nation looks to explore the continent’s untapped resources.

While Japanese African relations trace back to the 1960’s, it is only now that the economic powerhouse appears to have started taking a keen interest on what the continent has to offer when it comes to investment opportunities.

Japanese investors are increasingly showing great interest in setting up companies and financing other businesses around the continent. The result has been win-win situations for both.

Japan’s investments are becoming increasingly popular in part because of the country’s balanced trade across the continent. In 2017 the country exported $7.5 billion worth of goods to Africa and imported $8.3 billion.

South Africa Top Destination for Japanese Investors

While China has sought to spread its investments around the continent, Japanese investors appear to be maintaining a keen interest in some markets, more than others. According to data compiled by Asoko Insight the Japanese Ministry of Foreign Affairs and the Japan External Trade Organization, South Africa remains a top investment destination for Japanese investors.

According to data compiled by JETRO and analysed by Asoko Insight, there were about 738 Japanese companies registered in the Content as of the end of last year. Almost half of the companies, at 354, had their investments distributed across South Africa.

Most of the Japanese companies in Africa operate either as wholly owned subsidiaries or in partnership with local companies. Some of the companies are also believed to have formed alliances with foreign firms particularly from Asia and Europe.

Away from South Africa, Japanese company’s presence is also being felt in North Africa which happens to be the next top investment destination. In North Africa, there were about 138 Japanese companies representing 7.3%. East Africa comes third with about 120 Japanese companies followed by West Africa with 114 companies.

Areas of Investments

When it comes to investment areas, Manufacturing remains a top investment area with the JETRO Survey indicating about 315 companies involved in such operations. A quarter of the companies employ more than 51 staff with the others employing 50 or less.

Energy and mining are the two most popular investment areas for Japanese companies in the continent. The companies are in pursuit of fresh raw materials in the form of mineral resources that would keep their country’s industries up and running.

Why Africa?

Increased investments in Africa are part of a bigger plan of gaining access to markets for finished products back at home. The island nation plays host to some of the biggest companies in the world.

Faced with competition in developed markets, Japanese’s companies have had to look for new markers elsewhere, with Africa emerging as an exciting prospect in this case.

The continents market size is another attribute that appears to be fuelling investments according to JETRO Survey. Other factors include the vast continent portfolio of untapped natural resources. Pursuit of natural resources in Africa does not come as a surprise given that the country is not the most endowed on this front.

Asoko Insight is a data and information services company operating across Africa. Asoko is bridging the information and data gap across the continent, focussing on delivering the best corporate data and analytics platform of African private companies for market mapping, due diligence and investment needs.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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British Airways Owner IAG Prepares for Summer Surge Amid High Travel Demand

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As the world gradually emerges from the grip of the pandemic, the travel industry is witnessing a resurgence in demand with British Airways owner IAG SA gearing up for a busy summer season.

Despite lingering challenges, the airline conglomerate remains optimistic about the outlook, citing strong demand for travel within Europe and across the Atlantic.

In a recent stock exchange filing, IAG disclosed an adjusted operating profit of €68 million ($73.3 million) for the three months ending March.

According to Chief Executive Officer Luis Gallego, the group’s core markets, including the North Atlantic, South Atlantic, and intra-Europe routes, have shown robust performance, positioning them well for the upcoming peak travel period.

With vaccination rates increasing and travel restrictions easing in many parts of the world, consumers are eager to resume travel plans, fueling the surge in demand.

However, the road ahead is not without its challenges. While travel within Europe and across the Atlantic remains strong, other regions present a more complex operating environment.

The ongoing conflict in the Middle East has dampened demand for certain destinations, while airspace restrictions resulting from geopolitical tensions, such as the Russian invasion of Ukraine, have disrupted flight routes to East Asia.

Despite these hurdles, IAG remains resilient, banking on the strength of its core markets and the performance of its brands to weather the storm.

The company’s strategic positioning and proactive measures to adapt to changing circumstances have positioned it to capitalize on the rebound in travel demand.

As the summer season approaches, IAG is focused on ensuring operational readiness to meet the surge in passenger numbers.

With travelers eager to reconnect with loved ones, explore new destinations, and embark on long-awaited vacations, the airline group stands ready to facilitate safe and seamless travel experiences.

As vaccination campaigns progress and travel sentiment rebounds, IAG’s proactive approach and strategic investments position it as a key player in the aviation industry’s recovery journey. With optimism on the horizon, the company remains committed to delivering exceptional service and fostering a seamless travel experience for passengers worldwide.

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Israeli Troops Take Control of Rafah Border Crossing Amidst Ceasefire Talks

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Israeli troops took control of the Rafah border-crossing area in Gaza on Tuesday morning, with Hamas saying all aid flows from Egypt had stopped.

The army has halted “the movement of people and aid completely,” the Hamas-run crossing authority said in a statement. Soldiers replaced Palestinian flags with Israeli ones.

It’s the first time Israel’s army has moved into the area since the war with Hamas began in October.

Israeli Military Tells About 100,000 People to Leave Eastern Rafah

Palestinians sheltering in Rafah were told Monday to move to an “expanded humanitarian area”.

The border is the main entry point for aid into Gaza, and the Palestinian territory’s only crossing aside from those with Israel. The US has been urging Israel for weeks to allow more food and other supplies into Gaza, parts of which the United Nations says are on the verge of famine.

The movement of troops came a day after Israel told residents in parts of eastern Rafah to leave immediately ahead of a possible attack on the city.

Most Arab and many European states have said Israel should not attack Rafah, fearing it would cause mass casualties. Prime Minister Benjamin Netanyahu says Rafah is the last bastion of Hamas, with about 5,000 to 8,000 of its fighters and senior leaders lodged in the city, as well as many Israeli hostages.

Cease-fire talks between the two sides continue to drag. Hamas said on Monday night it had accepted a proposal from mediators Egypt and Qatar. Israel rejected it, saying it contained demands the Jewish state cannot accept.

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Israel Calls for Evacuation of Rafah Amid Threat of Assault

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Rafah, Gaza, Palestine

Israel called on civilians to evacuate parts of Rafah on Monday in what appeared to be preparation for a long-threatened assault on Hamas holdouts in the southern Gaza Strip city where more than a million war-displaced Palestinians have been sheltering.

Instructed by Arabic text messages, telephone calls, and flyers to move to what the Israeli military called an “expanded humanitarian zone” 20 km (7 miles) away, some Palestinian families lumbered out under chilly spring rain, witnesses said.

Israel’s military said it had begun encouraging residents of Rafah to evacuate in a “limited scope” operation. It gave no specific reasons, nor did it say if any offensive action might follow.

Seven months into its war against Hamas, Israel has been threatening to launch incursions in Rafah, which it says harbours thousands of Hamas fighters and potentially dozens of hostages. Victory is impossible without taking Rafah, it says.

The prospect of a high-casualty operation worries Western powers and neighbouring Egypt, which is trying to mediate a new round of truce talks between Israel and Hamas under which the Palestinian Islamist group might free some hostages.

The Rafah plan has opened an unusually public rift between Israel and Washington. Speaking to his U.S counterpart, Israeli Defence Minister Yoav Gallant linked Monday’s operation to the deadlock in indirect diplomacy, which he blamed on Hamas.

“During their discussion, Gallant discussed the efforts undertaken to achieve the release of hostages and indicated that at this stage, Hamas refuses the frameworks at hand,” the Israeli Defence Ministry said in a statement.

“Gallant emphasized that military action is required, including in the area of Rafah, at the lack of an alternative,” it added On Monday, the Israeli military called on Palestinians in eastern parts of Rafah to move to a nearby “humanitarian area”, saying it would “encourage … the gradual movement of civilians in the specified areas”.

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