“The report, which cites South Africa as the only country in Africa on the list of top 25 countries, demonstrates that our country’s blueprint on development is yielding results,” spokeswoman Phumla Williams said in a statement.
“South Africa offers lucrative value and opportunities for international investor partnerships, as the country is uniquely positioned as the gateway into Africa.”
South Africa also boasted a combination of developed first-world economic infrastructure and an emergent market economy which gave rise to a healthy entrepreneurial and vibrant investment environment.
South Africa rose to 13th position in AT Kearney’s 2014 index — compared to 15th in 2013 and 11th in 2012.
Global management consulting firm AT Kearney released the index following a survey of senior executives from 300 of the world’s leading corporations as to the most attractive FDI destinations around the world.
The United States maintained its first place, followed by China and Canada.
Africa increased FDI flows by 12 percent to US47.6 billion (R512bn) in FDI.
FDI growth on the continent was driven partly by investment in extractive industries, but manufacturing and services were also seeing increased interest.
South Africa received US4.5bn (R48.3bn) FDI in 2012 after a bounce of US5.8bn (R62.6bn) in 2011.
Williams said more companies internationally were seeing South Africa as an investment destination of choice.
“The country has a fertile business environment and infrastructure in a number of sectors including, finance and telecommunications,” she said.
“South Africa has heeded President Jacob Zuma’s call to focus on changing negative perceptions held by foreign investors and thereby attract further investment.”
Tax incentives by government, announced in 2011, had also contributed to attracting foreign direct investment.
“South Africa’s commitment to the Renewable Energy Independent Power Provider Programme has been identified as one of the key drivers of its improved rating on the index,” said Williams.
“The programme has been designed to contribute towards increasing the supply of electricity through renewable energy. It is also aimed at addressing socio-economic and environmentally sustainable growth.”