Nairobi battles with Dubai as investment hot spot for multinationals
On the continent, Egypt's Cairo lags behind due to political instability.
Kenya’s capital appears on the Fortune 500 list with Dubai, Johannesburg, Casablanca, Lagos and Cairo, as one of the highly coveted investment destinations.
According to Infomineo, a global business research company specialising in Africa and the Middle East, Nairobi is the leading destination for Fast Moving Consumer Goods (FMCG) companies.
Nairobi is the top choice for organisations looking to serve in the East Africa market and has seen a 12 per cent increase in Fortune 500 investment since 2015.
“While Dubai and Johannesburg are the most popular hubs overall, Casablanca and Nairobi are rapidly gaining traction and international awareness,” the report reads in part.
Casablanca's appeal shot up by 18 per cent, Dubai’s increase is eight per cent while that of Johannesburg is 26 per cent.
The report focuses on multinationals looking at entering, or already present, in the Middle East and Africa region (MEA).
The Infomineo analysis includes the regional footprint of multinationals in the MEA region, the most commonly chosen cities, and the factors that influence the selection of a region, country and city like geographical proximity and the talent pool present in the city.
Each element reveals the dynamic growth patterns within the region and a clear trend of Fortune 500 companies establishing presence.
“Among factors which impact on the organisation does selection of a specific city [are] the local market potential, maturity of the industry, exist competitors, political stability and the quality of the employment market. Determining the attractiveness of a location along these clear lines assures the Fortune 500 companies ... a stable and profitable investment and significantly mitigates risk,” said the report in part.
Overall, there was a 17 per cent increase in the number of Fortune 500 companies in MEA in 2016 compared with 2015, with Johannesburg the leading destination for Africa.
On the continent, Egypt lags behind due to political instability.
Germany and France are leading in terms of coverage rate while China has the lowest presence in the region.
Casablanca has the highest growth rate overall, while Dubai has the highest count.
The same can be said for London, which has tripled its number of regional headquarters serving the region, acting as an MEA hub.
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