AFRICA is often perceived as a difficult place in which to do business, but it is fast gaining popularity among foreign investors - especially those from emerging markets.

According to a new report by Ernst & Young, the amount of foreign direct investment in Africa has increased by 87percent over the past seven years.

"Investors in general are very confident about this part of the world," said Ajen Sita, a managing partner at Ernst & Young Africa, during the final day of the World Economic Forum on Africa, which was held in Cape Town.

"African investors are most confident about Africa, followed by their counterparts from China, India and other emerging markets," he said.

"Investors from the established markets - Europe and the US, for instance - are more sceptical. That is because they are still tainted by the global economic crisis and other problems. They are more focused on their own markets."

Sita said that it was not a problem that European and American investors were not as keen to pour money into Africa as they used to.

"Foreign direct investment has not gone down, as the emerging markets made up for that," Sita said.

"We predict that foreign direct investment from China and India, for instance, will continue to grow and overtake the foreign direct investment from the developed world by 2023."

Africa's relationship with China, specifically, was expected to grow and strengthen, Sita noted.

"Over the next 20 years China wants to build 30 cities the size of Johannesburg.

"In order to do so, China needs natural resources. That is good news for resource-rich Africa. The continent needs a solid emerging market investor, for instance, to upgrade and modernise its infrastructure."

One of the points raised during the 2011 edition of the forum was the fact that the lack of infrastructure, from energy and water to roads and telecommunication, was preventing Africa from achieving its economic growth potential.