In the latest Africa Risk-Reward Index by Oxford Economics for 2023, Uganda stands out as a promising destination for investments within the East African Community (EAC) and ranks third across the African continent. This achievement is attributed to Uganda’s robust economic growth, youthful population, and abundant natural resources. The report also praises Uganda’s efforts to improve its business environment, attracting investors.
In East Africa, Uganda shares the spotlight with Kenya, Tanzania, and Rwanda, all ranking high in investment potential. The top five most attractive African economies for investment, according to the index, include Ethiopia, Côte d’Ivoire, Uganda, Nigeria, and Senegal.
The index evaluates 54 African countries, considering factors such as economic growth, political stability, infrastructure, and the overall business environment. This year’s edition focuses on key themes that will shape Africa’s transition period, presenting both opportunities and risks.
The Uganda Investment Authority (UIA) underscores the country’s safety and strategic location within Africa, offering access to various markets. Moreover, the report highlights Africa’s potential in the global technology landscape, emphasizing opportunities and the need for financial support.
The report suggests that Africa’s financial institutions are stepping up to fill funding gaps and promote financial inclusion. Additionally, the implementation of the Africa Continental Free Trade Agreement (AfCFTA) is expected to boost regional financial connectivity.
However, the report also notes that global foreign direct investment to Africa declined in 2022 due to the COVID-19 pandemic and geopolitical conflicts. While access to financial services has improved, investors are encouraged to weigh the risks, including political instability, corruption, and infrastructure challenges, before making investment decisions.