Africa has been earmarked as a popular investment destination, with a host of sectors such as manufacturing, transport, renewables and mining considered popular for foreign direct investments (FDI). However, a report presented by the United Nations Conference on Trade and Development (UNCTAD) has stated that natural gas discoveries accounted for the largest chunk of FDI.

The World Investment Report has mentioned that members of the East African Community (EAC) were ahead of the rest of the continent in terms of bringing in FDI. Of the lot, Tanzania brought in US$2.14bn in 2014, up from US$2.13bn in 2013. A steady growth of 0.5 per cent in inflows helped Tanzania maintain its position as the leading destination for FDI in East Africa last year.

Christopher Chiza, Minister of State for Tanzania said that the surge in FDIs to Tanzania was attributed to the discovery of huge reserves of natural gas. The report said that at least 1.5 trillion cu/m have been found by various multi-nationals, leading to increased interest in the natural gas sector.

The Tanzanian government has recommended strengthening the global policy on environment, including both the International Investment Agreements (IIA) and the international tax regimes to enhance investment to Tanzania and Africa at large.

Meanwhile, Uganda, with its economically-viable gas reserves, registered US$1.47bn, whereas East Africa’s largest economy Kenya received US$989mn in FDI, added the report.

Source : Oil review