Professional investors forecast dramatic expansion in the levels of investment in Africa by pension funds and large corporates over the next five years as major funds increasingly regard the continent as an attractive area to invest, new global research for blockchain-based mobile network operator World Mobile shows.
The study with professional investors (e.g. pension funds, private equity, wealth management, banking) responsible for around $700 billion assets under management, found one in four are forecasting dramatic growth in institutional investment in the continent over the next five years with 46% expecting some growth. Just 12% expect a drop in investment.
The predicted growth in investment is driven by the attraction of the stable parts of Africa as a home for foreign direct investment with 80% of investors questioned rating the continent as attractive with 33% regarding it as very attractive for investment, the research among investors in the US, Germany, the UK, Hong Kong, India, Japan, Nigeria, and Switzerland found.
World Mobile is already active in Africa and is launching its unique hybrid mobile network supported by low altitude platform balloons in Zanzibar which it plans to roll-out throughout the continent. It is already in discussions with government officials in Tanzania and Kenya, as well as other territories underserviced by traditional mobile operators.
The research shows poor connectivity is the biggest barrier for organisations planning investment in Africa. The study ranked poor connectivity, which can mean no connectivity in some countries, above worries about a lack of infrastructure, regional conflicts, and corruption as constraints on investors.
The study shows investors believe Africa has massive potential – the key attraction for investors identified by the research is the large population offering a huge market for telecoms and banking. Natural resources and economic reforms across the continent were also rated as key attractions.