Exploring the links between business media coverage and investment flows into Africa
Date: 03/03/2009
Africapractice, on behalf of Diageo Africa, has undertaken a study,‘African business media and investment’ examining the extent to which African media has grown in quantity and quality in recent years as well as the degree to which perceptions about investing in Africa have changed. Thirty six investors across four continents with a combined portfolio of approximately US$20 billion under management in Africa were surveyed and they supplied their views about the media and how it informs their investment decisions.
The study, which was published to coincide with the first call for entries for the 2009 African Business Reporting Awards, reveals that coverage of business in Africa has proliferated during the last five years, growing in both quantity and quality. It reveals too the important role that the media plays in informing investment decisions and in attracting investments to Africa.
Illustrating the importance of African business media and private investment flows into Africa, the study reveals that investors in Africa are increasing in number and in type and this is driving the interest in business related information. African business media is today the primary conduit of financial information for a mass audience and it has the ability to reach both those invested in the continent and those that are not. This both reflects and dictates investor sentiment.
The findings shows that the economic and social development taking place in many African economies is attracting different types of investors; and greater and better information is catalysing new flows of private investment. African business media has grown in quantity, frequency and quality over the past five years. As a consequence of better information flows, perceptions of Africa as an investment destination have changed.
The media is an important source of information for investors, influencing the rate, scale and location of investment flows to Africa. As African business media becomes more sophisticated and increases in frequency and breadth, it will play a more central role for investors. According to the study, there is still a disparity between perceptions of Africa in the West and the reality on the ground in Africa and given the current global economic climate and the desire for accurate business and financial information, African business media will be even more central to informing investors’ views and influencing investment flows.