While South Africa has traditionally been the location of choice for both companies and multilateral organizations to base their African operations, slower economic growth and competition from fast-growing economies to the north and east is changing this dynamic.

A survey by FTI Consulting of opinion makers ahead of the WEF Africa meeting, found that the overwhelming majority see East and West Africa as the top destinations for investment activity. Nigeria, the continent’s largest economy and dynamic markets in central and East Africa, notably Rwanda and Kenya, are seen as offering increasing potential to investors.

A leading topic of conversation on the sidelines of the Cape Town meeting was the election of a new Nigerian President, Muhammadu Buhari, in April and the peaceful transition this represented, according to Jon Aarons, senior managing director in FTI’s Strategic Communications practice, who serves as coordinator of the firm’s partnership with the Forum.

This was the underlying theme of discussions at the World Economic Forum’s spring regional meeting in Cape Town from the 3rd to the 5th of June.

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Africa is an increasingly attractive business destination for multinational companies, but the continent’s power centre is shifting and the region still faces a number of challenges, including security threats, which have the potential to stunt economic growth.

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While the Nigerian presence at the WEF meeting was relatively small due to the political transition at home, Aarons noted that, “All eyes are on Nigeria; it’s a fast-growing economy in a way that South Africa is not.”

Nonetheless, Boko Haram’s continued incursions in Northern Nigeria and on-going threat that the Somali Al-Shabaab poses to Kenya have highlighted the need to strengthen security in both countries. Half of those responding to FTI Consulting’s pre-meeting research said they continued to view Africa as a risky investment destination, a finding that at least partly reflects these unresolved conflicts.

At the same time, three-quarters of FTI Consulting’s survey participants predicted an increase in African M&A activity, and this bullish outlook was conveyed most prominently at a breakfast panel discussion that many attendees identified as one of the highlights of the Cape Town meeting.

Chair Lord Mark Malloch-Brown, a senior advisor at FTI Consulting, was joined by a panel of leading figures from both the corporate and non-profit world, comprising Atlas Mara CEO Bob Diamond, President of the Bill and Melinda Gates Foundation Mark Suzman, Tiger Brands CEO Peter Matlare, Seplat Petroleum Chairman Dr. A.B.C. Orjiako, Rick Menell of Credit Suisse and Donna Oosthuyse, Director at Johannesburg Stock Exchange. The group discussed the challenges and opportunities for companies doing deals in Africa. There was a wealth of experience at the table. Each speaker spoke to the challenges and risks of cross-border investment.

Diamond agreed that the success of free and democratic elections in Nigeria has helped to switch investor interest back to Africa and he noted that his company had chosen to base its vital R&D for the technology for its payments platform in Rwanda because of strong cooperation with the government and its attitude towards business, according to an article in fin24, South Africa’s premier site for up-to-date business and finance news.

He told the session that his company is looking to extend its pan-African banking group into microfinance loans to the agricultural sector and said it was possible to get things done “surprisingly” quickly and easily in some part of the continent. Technology should be a key focus for investors in Africa, he added.

Mark Malloch-Brown commented: “Our research was echoed in the breakfast discussion. African markets are challenging but rewarding. They are not for the faint-hearted but the successes can hit the ball out of the park. I spend time in Nigeria where the number of new business dynamics is remarkable”.

While foreign investors’ interest in Africa seems set to rise, the opportunities to expand trade between African nations also got a boost as three African economic blocs agreed to a free trade deal in Egypt following the Cape Town meeting. The agreement between the East African Community, Southern African Development Community and the Common Market for Eastern and Southern Africa establishes a trading bloc, to be known as the Tripartite Free Trade Area (TFTA), consisting of 26 countries, a population of 625 million and gross domestic product of $1 trillion, according to Agence France-Presse.

Interest in the African continent looks set to intensify in the near term, but financial investors will be paying keen attention to the ability of governments to maintain the economic policies needed for dynamic growth and ensure that political and security conditions are sufficient to support a strong business climate.

UNDERSTANDING THE AFRICA OPPORTUNITy

About FTI ConsultingFTI Consulting, Inc. is a global business advisory firm dedicated to helping organisations protect and enhance enterprise value in an increasingly complex legal, regulatory and economic environment. FTI Consulting professionals, who are located in all major business centres throughout the world, work closely with clients to anticipate, illuminate and overcome complex business challenges in areas such as investigations, litigation, mergers and acquisitions, regulatory issues, reputation management and restructuring.

The views expressed in this article are those of the author(s) and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.

www.fticonsulting.com ©2015 FTI Consulting, Inc. All rights reserved.

Jon Aarons Senior Managing Director +44 (0) 20 3727 1011jon.aarons@fticonsulting.com

Mark Malloch-Brown Special Advisor +44 (0) 20 7290 4891mark.malloch-brown@fticonsulting.com

Max Gebhardt Managing Director +27 (0)11 214 2402max.gebhardt@fticonsulting.com

All eyes are on Nigeria; it’s a fast-growing

economy in a way that South Africa is not.

— Jon Aarons,

Senior Managing director,

FTI Consulting