"Make investing easy, Africa told"

That’s the headline on the front page of Business Day’s Companies & Markets section today. That’s an issue we talk about a lot, often in the context of the role of media in developing a healthy investment climate. It also came up at the World Economic Forum (WEF), as we outlined in a post below.

But it seems it takes a bold statement by Standard Chartered at a conference in Sandton to make the news. At the Banking Outlook conference, Steve Brice, head of global markets Southern Africa, talked about the need to counter the impact of the financial crisis, the impact of which was not yet fully understood on the continent.

Plenty of reasons why African countries are suffering in the downturn, but his advice to “stick to their knitting” and be internally focused, seems to go against his over-arching call to be more externally-focused to attract foreign investors. No wonder we’re not making this easy on ourselves..

US President Barack Obama takes a different approach in an interview with AllAfrica.com today, stating African nations must clean up corruption and end political instability in order to attract the investment needed to prosper. ‘Speaking in advance of a visit this week to Ghana, Obama said there was a direct correlation between governance and prosperity and urged African leaders to do better.’

In terms of ease of doing business, the average ranking of sub-Saharan countries is 138 out of 181 countries globally. So there are worse places. Remember, this is not a comment on the attractiveness of doing business, but in terms of how to lift Africa up the rankings to a place that is easy to do business, there doesn’t seem to be a simple solution. The measures that Brice puts forward, developing long-term interest rate and forward foreign exchange markets are – on his own admission - “easy to say and difficult to do”. Obama’s solution of ending corruption and political instability is a pretty tall order too..

Raila Odinga, Prime Minister of Kenya told WEF that Africa has to knock down the hurdles to doing business, such as lengthy legal and operational processes - but this has to be permanent, not temporary measures. Omari Issa, CEO, Investment Climate Facility, commented that African media needs to be part of changing the perception of Africa as a good place for business, as investors still often look to international media for info – and it needs to come from the inside.

This raises the question of whether it is just an external perception – or a reality - that Africa is a hard place to do business? Will it always be more difficult than an America or Germany, and investors just need to get over it and go for it? While there are undoubtedly people and processes that could make foreign investment easier, is it just a different way of doing business, which also sees different returns?

I don’t mean to push the onus of finding a solution back on to the international investors, but like any form of regulation or policy change, it is external pressure that will make things happen. Internal change or any kind of self-regulation is never easy, without the threat of losing something – and foreign investment is no small thing – especially in a downturn. We can at least agree on that.