According to the EY report, the number of new FDI projects in sub-Saharan Africa (SSA) increased by 4.7 per cent, although the total number of new FDI projects declined by 3.1 percent due to the political uncertainty in North Africa.
"What assisted South Africa's attractiveness was the independent power programme that the country has launched," Dumi Jere, head of strategy for AfriCatalysts told CNBC Africa.
Jere added that there was room to gain more especially when one looks at the mineral base held in the continent.
He added that good policies were essential in attracting investor confidence urging regional economies to enact investor friendly policies. "No one puts his or her money in a country whose policies are not business friendly. FDI is a sign of good policies from government and good corporate governance," noted Jere.
Jere said FDI figures indicated that the continent was making incremental gains. "Some of the numbers you see may not be big but they are small moves towards the bigger picture of the attractiveness of the continent," he said. Turning to South Africa, Jere welcomed FDIs into the country saying this was useful for the country's recovery process.
South Africa was the hardest hit economy by the global recession of 2008 if compared to the rest of the continent. Jere urged government to communicate better saying currently there was a discord between government departments. "Sometimes it seems there is miscommunication with regards to policies government puts out," he noted.
"An example is seen in the department of regional integration and home affairs where regional integration seeks to promote the integration of economies with the home affairs enacting policies that seem to contradict that."