Africas Silkroute Indias New Economic Frontier
-
Upload
aklanta-kalita -
Category
Economy & Finance
-
view
1.928 -
download
0
description
Transcript of Africas Silkroute Indias New Economic Frontier
Africa's Silk Road: India's New Economic Frontier
1. Current FDI Scenario2. Indian FDI into Africa
Africa: Inbound FDI
Source: US World Development Indicators
From the World Bank Report “Africa’s Silk Roads: China and India’s New Economic Frontiers”
Africa FDI inflows 1995-2006
Source: World Investment Directory, 2008 UNCTAD
FDI Africa by Destination (Cumulative 1990-2004)
South Africa
Nigeria
Angola
Equatorial G
Sudan
Source: UNCOMTRADE
Billion USD
Chad
From the World Bank Report “Africa’s Silk Roads: China and India’s New Economic Frontiers”
Top 15 FDI Destination Africa in 2006
South Africa
Nigeria
In USD BillionSource: World Investment Report 2007, UNCTAD
Egypt
Kenya
Morocco
Nigeria
Angola
Equatorial G
SudanChad
South Africa
Ghana
Angola
Equatorial G
SudanChad
From the World Bank Report “Africa’s Silk Roads: China and India’s New Economic Frontiers”
Share of Sectoral FDI inflows (2002-April 2006)
Tanzania
Investment Drivers
A number of factors have contributed to the overall increase of FDI inflows as well as to the sectoral and source country composition of FDI flows to the region
Rich natural resources have always attracted FDI inflows in Oil and primary commodities sector, regardless of poor investment climate conditions
Improved macro economic and political stability for many of the African countries
Sector based reforms » Financial sector liberalisation and changes in trade policy encourages FDI into
financial and automotive sectors in South Africa» Change in mining codes in Ghana and other African countries has facilitated FDI
in mining» Simplification of FDI regulations and the establishment of more transparent FDI
regimes in Ghana, Senegal and Tanzania
Impediments
Political instability and conflict for a number of countries High tariff barriers among the countries in the region than between the
regions and countries outside of Africa resulting in the balkanization of domestic markets
Regulatory and fiscal burden (Africa has the highest taxes compared to the other developing countries and most cumbersome business and customs procedures)
High corruption Weak and at times deteriorating physical infrastructure Lack of critical mass of skilled workers and labour force
Prospect of FDI in Africa 2007-2009…
Africa North Africa Sub Saharan Africa0
10
20
30
40
50
60
70
80
90 Response to UNCTAD Survey, % of respondents
Decrease
No Change
Increase
1. Current FDI Scenario2. Indian FDI into Africa
India’s FDI Outflow: Sector & Destination
From the World Bank Report “Africa’s Silk Roads: China and India’s New Economic Frontiers”
Source: UNCTAD
India’s Bilateral Trade with Africa
From the World Bank Report “Africa’s Silk Roads: China and India’s New Economic Frontiers”
India’s FDI in Africa: (2000-2004)
Source: UNCTAD, FDI/TNC database
FDI flows to Africa from India 2000-2004
243.3184.8
883.4
338.4
22.10
100
200
300
400
500
600
700
800
900
1000
2000 2001 2002 2003 2004
USD
Mill
ion
India Inc. Investing in Africa
South Africa
Egypt
Tanzania
Morocco
Nigeria
Angola
Equatorial G
Sudan
Chad
Zimbabwe
Zambia
Ghana
Congo
Kenya
Mauritius
Sudan
Nature of Indian FDI in Africa
Much of the accumulated stock of Indian FDI in Africa is concentrated in extractive sectors, such as oil and mining
Greater diversification of FDI flows to Africa has in fact been occurring more recently
Recent Indian investments on the African continent have been made in apparel, food processing, retail ventures, fisheries, commercial real estate and transport construction, tourism, power plants, and telecommunications, among other sectors
Thank you…