Nairobi has been listed among the leading regional destinations for Fortune 500 companies that are looking to establish international headquarters.
Kenya’s capital is ranked among favourites that include Dubai, Johannesburg, Casablanca, Lagos, and Cairo as a destination with the highest attractiveness.
According to a report released by Infomineo, a global business research firm, Nairobi is the leading destination for Fast Moving Consumer Goods (FMCG) companies.
Kenya’s capital is also the top choice for international firms looking to service eastern Africa, the report states, adding that it has registered 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,” Infomineo says.
Casablanca’s uptick in Fortune 500 investment is by 184 per cent, Dubai by 8 per cent while that of Johannesburg is by 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, the factors influencing the selection of a region, country and city.
“Among factors which impact on the organisation’s selection of a specific city include the local market potential, maturity of the industry, existing 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 of a stable and profitable investment and significantly mitigates risk,” said the report.
Overall, there was a 17 per cent increase in the number of Fortune 500 companies in the MEA region in 2016 compared to 2015, with Johannesburg being the leading destination for Africa.
In Africa, Egypt lags behind top cities due to political instability despite a 250 per cent increase in Fortune 500 investment in the last three years.
Casablanca has the highest growth rate overall while Dubai has the highest count.
In the Middle-East, Dubai is the most popular choice with 138 companies establishing a dedicated entity in the city.
In 2016, 196 Fortune 500 companies had established a regional headquarters in the MEA region.
There has also been a marked uptick in companies deciding to cover MEA from outside of the region, with 38 international firms choosing to establish regional headquarters in areas such as London, Brussels and Paris.