Morocco passes South Africa to become Africa's fourth-most attractive investment destination
Rand Merchant Bank's 2026/27 ranking lifts Morocco from fifth to fourth on years of industrialisation, export diversification and infrastructure investment; while South Africa, still the continent's biggest economy, slips to fifth on slower growth.
Published 28 October 2026 · 09:13 GMT
The summary
Rand Merchant Bank's 2026/27 ranking lifts Morocco from fifth to fourth on years of industrialisation, export diversification and infrastructure investment; while South Africa, still the continent's biggest economy, slips to fifth on slower growth. Rand Merchant Bank's "Where to Invest in Africa" 2026/27 report, released on Tuesday, October 27, 2026, ranks Morocco fourth among African investment destinations, up from fifth, pushing South Africa down to fifth. Seychelles, Mauritius and Egypt keep the top three places for a third consecutive year; the ranking assesses 31 countries across 20 indicators grouped into four pillars.
The three lenses
- WestWest; Bloomberg's account, the wire that carried the story worldwide, frames the move as a shift in Africa's industrial landscape: Morocco's manufacturing expansion and faster growth propelling it ahead of the region's biggest economy, while South Africa's much larger industrial base is constrained by years of weak growth and infrastructure bottlenecks.
- EastEast, Eastern coverage has been quiet in the ranking's first day, no major East outlet has yet headlined the result; so the East lens reads the report itself rather than its reception.
- Global SouthSouth; Southern coverage is the most divided, and the most practical.
Key facts
- Rand Merchant Bank's "Where to Invest in Africa" 2026/27 report, released on Tuesday, October 27, 2026, ranks Morocco fourth among African investment destinations, up from fifth, pushing South Africa down to fifth. Bloomberg via Moneyweb (Oct 27, 2026)
- Seychelles, Mauritius and Egypt keep the top three places for a third consecutive year; the ranking assesses 31 countries across 20 indicators grouped into four pillars. eNCA (Oct 27, 2026)
- RMB attributes Morocco's rise to "years of successful industrialisation, export diversification and infrastructure investment", and calls the country one of Africa's leading manufacturing hubs, particularly in automotive production. Bloomberg via Moneyweb (Oct 27, 2026)
- Morocco's economy grew 4.9% in 2025, compared with 1.1% in South Africa, according to figures cited in the report. Bloomberg via Moneyweb (Oct 27, 2026)
- Nigeria records the biggest improvement, climbing seven places to 11th, while Senegal records the steepest fall, dropping five places to 19th. Bloomberg via Moneyweb (Oct 27, 2026)
What changed in Africa's investment ranking this week?
Morocco has overtaken South Africa to become Africa's fourth-most attractive investment destination, according to Rand Merchant Bank's "Where to Invest in Africa" 2026/27 report, released on Tuesday, October 27, 2026. The Kingdom climbs from fifth place in the previous edition, pushing South Africa, still the continent's biggest economy, down to fifth. Seychelles, Mauritius and Egypt keep the top three places for a third consecutive year. The ranking assesses 31 African countries across 20 indicators grouped into four pillars: economic performance and potential; market accessibility and innovation; the investment climate; and social and human development. For Morocco, the move crowns an industrial strategy pursued steadily for more than fifteen years, built around factories, ports and export diversification. For South Africa, it reads as a warning rather than a verdict: the report still credits its deep financial markets, improving energy security and reform momentum, while recording that slower growth has cost it ground.
What do the ranking's own numbers actually show?
The growth gap is the headline difference. Morocco's economy expanded by 4.9% in 2025, compared with 1.1% in South Africa, according to figures cited in the report. RMB's own explanation is direct: Morocco's rise reflects "years of successful industrialisation, export diversification and infrastructure investment", and the country "has emerged as one of Africa's leading manufacturing hubs, particularly in automotive production, while maintaining macroeconomic stability and attracting substantial foreign direct investment". The automotive story carries the detail. BusinessDay reports that Morocco's vehicle production has doubled since 2015, and the report calls Morocco the highest-ranked industrial economy in Africa over the coverage period. Fitch Solutions figures cited by Le360 put Morocco's 2024 output at nearly 614,000 vehicles, against about 591,000 in South Africa, the first time Morocco led the continent, built on Renault operations in Casablanca and Tangier and Stellantis in Kenitra, with a network of suppliers in wiring, components and interiors. Morocco's exchange-office data, reported by Hespress, put automotive exports at 154.49 billion dirhams in 2025, down 2% on the year, before a recovery in the first eight months of 2026, up 14.5% to 116.15 billion dirhams. Elsewhere in the ranking, Nigeria climbs seven places to 11th on fuel-subsidy removal, foreign-exchange liberalisation and statistical reforms, and Côte d'Ivoire reaches seventh. RMB chief economist Isaah Mhlanga frames the lesson plainly: Africa's strongest investment markets increasingly combine growth with credible policy, stronger institutions and greater resilience to shocks.
What does a fourth-place ranking not tell investors?
A ranking of attractiveness is not a ledger of money received. As Madar notes, the report measures relative investment attractiveness rather than actual foreign investment, so fourth place does not mean Morocco receives the fourth-largest inflow on the continent. The full country scores behind the headline ranks are not in the public coverage, which means the size of the gap between fourth and fifth, and which of the 20 indicators moved it, cannot yet be pinned down. Nor can anyone yet say whether the shift is durable: one edition captures a moment, and South Africa's economy remains far larger, with financial depth and industrial breadth that a single ranking does not erase. The report adds a new resilience and vulnerability framework this year, separating an economy's ability to withstand shocks from its exposure to them, but a new framework has no track record yet against real crises. And the reform response is unwritten: South Africa's trade minister Parks Tau has said the country will phase out semi-knocked-down vehicle assembly, yet the effect of that policy on factory investment will only show in production and export figures over the coming years.
Why does one place in a ranking carry weight beyond Rabat and Pretoria?
Rankings like this one act as shortlists. When a bank that advises clients on where to put capital in Africa moves a country up its list, boardrooms that have never visited a plant in Kenitra or a port in Tangier start with that page. Morocco's climb therefore matters as a signal: it tells investors that a manufacturing bet on the Kingdom is now, in RMB's judgement, a better risk-adjusted proposition than one on the continent's largest economy. It also matters as pressure. South Africa's auto industry accounts for roughly 5% of its economy, and BusinessDay reports Pretoria already feels the squeeze, with officials warning that if the country does not build the vehicles European markets will buy, it will lose those markets. The timing sharpens the story: Morocco is deep in preparations with Spain and Portugal for the 2030 World Cup, and the infrastructure drive around the tournament is part of the same long investment in ports, roads and stadiums that the ranking rewards. A fourth-place finish will be quoted in every Moroccan investment pitch for a year; the question is whether the factories behind it keep justifying the quote.
How should the industrial story be weighed against the ranking's limits?
The honest reading holds two truths at once. First, Morocco's rise is earned, not conjured: fifteen years of industrial policy, two global carmakers, a supplier ecosystem, export diversification and steady infrastructure spending are visible in production lines and port traffic, not only in an index. The Kingdom's strategy has been consistent across governments, and consistency is precisely what investors pay for. Second, a ranking flatters as much as it reveals. Seychelles, Mauritius and Egypt sit above Morocco, yet none of them is an industrial power on Morocco's scale; the index blends tourism economies, financial centres and manufacturing hubs into one list, and a country can climb it without becoming the continent's factory. South Africa's fall to fifth is real, but so are its advantages: deeper financial markets, a larger domestic market and an industrial base that, even in decline, still produces at continental scale. The fair conclusion is narrower than either celebration or alarm. Morocco has built the stronger recent record; South Africa retains the deeper bench. The ranking measures momentum, and momentum, unlike factories, can reverse. That is why the more telling figures will be the ones that arrive after the headlines: full-year 2026 exports, new plant announcements, and whether Pretoria's auto reforms translate into orders.
What could this reshuffle set in motion across the continent?
The first consequence lands in Pretoria. A public demotion concentrates political minds, and the auto-industry response, phasing out semi-knocked-down assembly and pushing local content, will now be judged against Morocco's example at every step. If it works, South Africa's industrial decline slows; if it stalls, the next edition could widen the gap. The second consequence lands in investment committees. Morocco's fourth place becomes a line in pitch books from Casablanca to Dubai, and rival destinations, Egypt, Nigeria, Côte d'Ivoire, will sharpen their own offers in response, a competition that tends to benefit investors more than any single winner. The third consequence is a demonstration effect for reformers: Nigeria's climb on subsidy removal and exchange-rate liberalisation, and Côte d'Ivoire's rise to seventh, give other governments a visible payoff for painful reforms, while Senegal's five-place fall shows the cost of fiscal and political turbulence. Finally, there is the quiet consequence for Morocco itself. Rankings raise expectations, and a country that has just been declared the continent's fourth-most attractive destination will be watched harder; on delivery, on jobs, and on whether the factories keep pace with the praise. The Kingdom's new government, which presented its 2026–2031 programme to Parliament days ago, now carries that expectation in public, alongside its 2027 finance bill and its regional development plans.
When will the ranking meet its first real-world test?
The next data points arrive within months. Full-year 2026 automotive export figures will show whether the eight-month recovery reported by Hespress held through the year, and plant announcements from Renault, Stellantis and their suppliers will show whether the ranking itself is pulling in fresh commitments. In South Africa, the test is policy: whether the phase-out of semi-knocked-down assembly and the wider auto strategy produce local-content investment or merely paperwork. The next edition of the ranking, a year from now, will render its own verdict; but investors will not wait that long. Every quarterly export release, every factory opening and every credit-rating note between now and then will either confirm Morocco's fourth place as a trend or expose it as a snapshot. For a Kingdom that has spent fifteen years building the factories behind the headline, the work after the ranking matters more than the ranking itself.
The three lenses
West Lens:
West; Bloomberg's account, the wire that carried the story worldwide, frames the move as a shift in Africa's industrial landscape: Morocco's manufacturing expansion and faster growth propelling it ahead of the region's biggest economy, while South Africa's much larger industrial base is constrained by years of weak growth and infrastructure bottlenecks. The Western reading is unsentimental about size: capital follows execution, and a smaller economy that builds steadily can outrank a larger one that stalls.
East Lens:
East, Eastern coverage has been quiet in the ranking's first day, no major East outlet has yet headlined the result; so the East lens reads the report itself rather than its reception. What travels east is the industrial-competitiveness finding: the continent's highest-ranked industrial economy is now Morocco, not South Africa, and the report's new resilience framework speaks directly to manufacturers weighing African production bases against supply-chain shocks. For Asian exporters and investors, the ranking reorders the shortlist, even before their own press has caught up with it.
South Lens:
South; Southern coverage is the most divided, and the most practical. Moroccan outlets, from Hespress and MAP to Le360, present the climb as the payoff of a long industrial strategy, lingering on the factories, the export figures and the infrastructure behind them. South African outlets, from BusinessDay to eNCA, treat it as a competitiveness warning, asking what Pretoria must fix in autos, logistics and energy.
The consensus
- What we agree on
- What we agree on: Rand Merchant Bank's "Where to Invest in Africa" 2026/27 report, released on October 27, 2026, ranks Morocco fourth and South Africa fifth among 31 African countries assessed on 20 indicators in four pillars, with Seychelles, Mauritius and Egypt holding the top three places for a third consecutive year.
- What we don't agree on
- What we disagree on: what the move means; Moroccan coverage reads it as confirmation of a long industrial strategy, South African coverage reads it as a competitiveness warning, and analysts differ on how far a ranking of relative attractiveness predicts where capital will actually flow.
- What we know
- What we know: Morocco climbed from fifth to fourth; its economy grew 4.9% in 2025 against 1.1% for South Africa; RMB credits industrialisation, export diversification and infrastructure investment, led by automotive manufacturing; Nigeria climbed seven places to 11th and Senegal fell five places to 19th.
- What we don't know yet
- What we do not know: the full country scores behind the headline ranks, how much of the gap reflects one strong year rather than a durable shift, and whether South Africa's announced auto-industry reforms will close the competitiveness gap before the next edition.
- What we expect
- What we expect: a policy response from Pretoria on industrial competitiveness, a confident Moroccan pitch to investors built on the ranking, and a harder test when full-year 2026 export and investment figures arrive; the numbers that will show whether fourth place was a moment or a trend.
Questions, answered
What is Rand Merchant Bank's Where to Invest in Africa ranking?
It is an annual ranking by Rand Merchant Bank, the Johannesburg-based bank owned by FirstRand, that assesses 31 African countries on 20 indicators grouped into four pillars: economic performance and potential, market accessibility and innovation, the investment climate, and social and human development. The 2026/27 edition was released on October 27, 2026.
Why did Morocco overtake South Africa in the ranking?
RMB credits Morocco's rise to years of industrialisation, export diversification and infrastructure investment, led by automotive manufacturing, alongside macroeconomic stability and substantial foreign direct investment. Morocco's economy grew 4.9% in 2025, against 1.1% for South Africa, whose slower growth and infrastructure bottlenecks cost it ground despite deeper financial markets.
Does fourth place mean Morocco receives the fourth-most foreign investment in Africa?
No. The ranking measures relative investment attractiveness, the conditions that make a country appealing to investors, rather than actual foreign investment received. A country can rank highly on conditions while receiving less capital than a larger economy, and South Africa remains the continent's biggest economy even after slipping to fifth place.
Who else moved sharply in the 2026/27 ranking?
Nigeria recorded the biggest improvement, climbing seven places to 11th on fuel-subsidy removal, foreign-exchange liberalisation and statistical reforms that RMB says are resetting its economy on a more sustainable course. Senegal recorded the steepest fall, dropping five places to 19th amid political turbulence, a fiscal-credibility crisis and sovereign credit downgrades. Côte d'Ivoire climbed to seventh.
Sources
- Bloomberg via Moneyweb (Oct 27, 2026)
- eNCA (Oct 27, 2026)