This article was contributed to TechCabal by Conrad Onyango/bird
Africa’s emerging financial hubs are posting marked improvements on a global index, signalling an opening up of regional economies – and jostling for status.
Cities across Africa are rising into the ranks of most preferred global financial hubs, significantly raising their capacity to attract investment and drive economic growth across the continent, the latest edition of a global index shows.
The Global Financial Centers Index illustrates how African cities are rising up the table of global financial jurisdictions, as more of the continent’s cities make the cut and join the influential index.
“South African centres saw the largest improvements. Kigali and Lagos joined the index for the first time,” according to 30th edition of the index, produced by Z/Yen and the China Development Institute, released in September.
Johannesburg rose 26 places to boost its ranking to position 64 in the global rankings – third in Africa after another South African city, Cape Town, which toppled 20 other destinations to settle at position 62.
The biannual ranking tracks 126 centres across the world, based on 146 instrumental factors grouped into five broad areas of competitiveness: Business Environment, Human Capital, Infrastructure, Financial Sector Development, and Reputation.
Mauritius, with a strong track record in cross-border finance and investment, has also risen up the global ranks by 16 places to position 73. The fourth-ranked African financial centre also recorded a slight improvement in its overall ratings.
The launch of Kenya’s Nairobi International Financial Centre (NIFC) in early August may have boosted the city’s rankings, as it climbed ahead of eight financial jurisdictions to make it to the top 100 global financial centres.
Called the “silicon savannah” for its startup culture, Nairobi has long been regarded as East Africa’s economic hub and the city saw its ratings rise by 21 points since March this year. It is pushing hard to become a financial gateway for Africa. However, its regional status is at stake as cities in neighbouring countries push to make themselves more financially competitive.
Rwanda, much-lauded for its bid to develop as an entrepreneurial hub, saw its capital Kigali make an entry into the global rankings and is also listed among 15 global financial centres that are likely to be “significant” over the next two to three years. Kigali ranked 94th on the index and 5th in Africa – ahead of Kenya.
Lagos was also a new entrant, coming in just two positions shy of the top-100 table, at 102. The bustling mega-city is ranked the seventh-best financial centre in Africa.
Casablanca Finance City retained its ranking as Africa’s top financial centre, dropping slightly to place 53rd.