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2012 Africa attractiveness survey - EY - South Africa

Africa Attractiveness Survey 2011

Viewpoint: Operating circumstances are challenging but not insurmountable

Nikolai Germann
Managing Director
Addax Bioenergy

Addax Bioenergy has embarked on what we hope will be a remarkable project to introduce a large-scale "sugar cane to ethanol" plant in Sierra Leone to service the European Union market. Addax Bioenergy is a private company that descended from the fuel company Addax, which operates in five African countries and which was sold quite recently to the Chinese fuel company Sinopec.

People are amazed that we have chosen to locate our plant in Sierra Leone, which underwent a long and gruesome civil war in the 1990s. But the political situation is much better now and current president Ernest Bai Koroma came from the party that was previously in opposition.

He is a former insurance manager and strongly supportive of investment. He is particularly keen on diversifying the economy away from mining, even though there are some big mining projects under way, since this concentration on mining is now considered to be one of the causes of war.

“Africa is a place replete with possibilities,” Kgalema Motlanthe
Deputy President of the Republic of South Africa.

Our second edition of Africa Attractiveness builds on the theme of the African growth story, while emphasising the need to bridge a perception gap that continues to exist among many potential investors not yet doing business on the continent. In so doing we highlight the various factors that are contributing to sustainable economic growth on the continent, specifically regional integration and reducing the infrastructure deficit.

Key findings:

  • The number of Foreign Direct Investment (FDI) projects in Africa grew 27% from 2010 to 2011, and have grown at a compound rate of close to 20% since 2007.
  • Despite this growth, there remain lingering negative perceptions of the continent — but only among those who are not yet doing business in Africa.
  • The story of Africa’s progress, not just in economic but also in socio-political terms, needs to be told more confidently and consistently.
  • This broad-based progress is underscored by a substantial shift in mindset and activities among Africans themselves, with increasing self-confidence and continued strong growth in intra-African FDI (which has expanded by 42% since 2007).
  • Regional integration is critical to accelerated and sustainable growth. Creating larger markets with greater critical mass will not only enhance the African investment proposition, it is also the only way for Africa to compete effectively in the global economy.
  • Bridging the infrastructure gap will be a key enabler of regional integration, growth and development. It also remains a key challenge and opportunity for investors.

To investigate the above in depth we will consider:

Mark Otty Mark Otty

Area Managing Partner Europe, Middle East,
India and Africa
Ernst & Young
Ajen Sita Ajen Sita

Area Managing Partner
Ernst & Young


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    Michael Lalor
    Lead Partner Africa Business Center
    Ernst & Young South Africa
    Tel: +27 83 611 5700

    Sarah Custers
    Africa Marketing
    Tel: +27 11 772 3300

    Fathima Naidoo
    Africa Press Relations
    Tel: +27 11 772 3151

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