Keypoints:
- Africa’s FDI rose 75 percent to $97bn
- Renewables dominate sectoral inflows
- Growth remains uneven across regions
AFRICA attracted a record $97bn in foreign direct investment (FDI) in 2024, marking a dramatic 75 percent increase from the $55bn received in 2023, according to the World Investment Report 2025 published by the United Nations Conference on Trade and Development (UNCTAD) on June 19. The surge raised Africa’s global FDI share to 6 percent, up from 4 percent the previous year.
North Africa drives investment gains
While the increase was partly driven by a major urban development deal in Egypt, even without that, the continent recorded 12 percent FDI growth. North Africa dominated the investment landscape, accounting for $76bn—around two-thirds of total inflows.
Egypt led the region’s performance, buoyed by large-scale projects, while Tunisia recorded a 21 percent jump in FDI to $936 million. Morocco saw an even stronger rise of 55 percent, reaching $1.6bn.
UNCTAD attributed the overall growth to improved investment facilitation and policy reforms, noting that Africa was responsible for 36 percent of all investor-friendly policy measures implemented globally in 2024.
Renewables overtake fossil fuels
A key highlight from the report is the growing investor appetite for low-carbon infrastructure. Renewable energy emerged as the continent’s strongest sector, with $17bn invested across seven major projects in Morocco, Tunisia, and Namibia.
Conversely, traditional electricity and gas projects witnessed a dramatic fall in interest, with a $51bn decline in investment value compared to previous years. This stark contrast underscores a clear shift in investor focus toward green energy.
Investment remains uneven
Despite the headline growth, UNCTAD warned that Africa’s investment recovery is not yet broad-based. The number of actual projects dropped by 3 percent, and the total value of new investment announcements declined by 37 percent—from $178bn to $113bn.
Regions outside North Africa continued to struggle, particularly those reliant on traditional energy and infrastructure sectors. Sub-Saharan Africa, in particular, saw subdued investor activity.
Global partners and shifting trends
Europe remained Africa’s leading source of FDI, followed by the United States and China. However, Beijing’s strategy has evolved. Instead of focusing on large-scale industrial projects, China is now channelling its $42bn African portfolio into agribusiness, healthcare, and social infrastructure through its Belt and Road Initiative.
Cross-border mergers and acquisitions (M&A) on the continent turned negative, signalling a cautious stance among investors and concerns about deal quality and viability.
Call for structural reforms
To maintain and build on the investment momentum, UNCTAD urged African governments to scale up their absorptive capacities and improve institutional readiness. It also called for modernised regulatory frameworks and a faster push towards a green transition to ensure long-term sustainability and competitiveness.
The full World Investment Report 2025 is available on UNCTAD’s website: https://unctad.org/publication/world-investment-report-2025
