Increased political stability, improved commodity prices and effective public economic reforms led to an improvement in the risk-reward score of several West African economies, according to the 2018 Africa Risk-Reward Index from Control Risks and Oxford Economics.
Ghana leads these positive developments for West Africa, recording the strongest improvement in its risk-reward score in Africa after Zimbabwe and Egypt. Both Nigeria and Senegal benefit from a greatly improved risk score.
Tom Griffin, Senior Partner for West Africa at Control Risks comments: “In 2017, many West African governments embarked on an impressive journey to implement the right reforms for economic growth and improvement of investors’ confidence.
“Since coming to power in January 2017, Ghana’s government has continued to undertake a programme of macroeconomic reforms which have focused on reducing the deficit and external debt. In the last year, this had a particularly positive impact on issues such as credit and exchange risk. At the same time, Ghana has attempted to improve the business environment for investors by reducing the bureaucratic and taxation burden, as well as laying out plans for further investment activity in the oil and gas and manufacturing sectors.
“In Nigeria, the recently initiated Economic Recovery and Growth Plan has begun to tackle some of the economy’s challenges – including corruption and an infrastructure deficit. The plan has also sought to remove bottlenecks to improve the ease of doing business, which in turn boosts investors’ confidence.
“In the last three years Senegal’s Emerging Senegal Plan has already led to steady growth, reaching close to 6.4% in 2017. The reduction in its risk score is one of the most positive changes in the 2018 Africa Risk-Reward Index, and can be explained by structural reforms to improve the business environment, strengthened macro-economic fundamentals and a controlled debt management policy.”
Further findings of the report: