Perceptions of Investors Regarding FDI in Africa

Škoro, Milko
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The research subject of this study is based on an understanding of the perceptions of potential investors in Africa against a preconceived bias. The main hypothesis of this research is that there is a bias by developed economies when investing in Africa. The hypothesis is explored through three research questions. The first research question seeks to understand if there are specific reasons for the bias towards investing in Africa; the second seeks to determine if the rationale for investing in Africa is overridden, either consciously or subconsciously, by the emotion and/or perceptions of Africa. The third research question compares Africa’s attractiveness to other emerging markets such as Brazil, Russia, India and China. (South Africa is included in the comparison in order to obtain a view of the BRICS countries). Data was collected electronically through an online service provider that specialises in survey research and interpolated into a statistical package. The research shows that there is no statistically significant bias towards investing in Africa, and that growth in the African market is the primary reason for investing in the African continent, followed by mineral extraction and mineral beneficiation. Lastly, the research shows that Africa is considered a preferred investment destination, but that Southern Asia and South America hold a significantly similar position in the views of the respondents.
MBA thesis
Foreign direct investment