Foreign investment in Africa surged by 75% to reach an all-time high of $97 billion in 2024, bolstered by liberalization and facilitation efforts across the continent.
© Shutterstock/Wesley Poon | An automobile assembly plant in Johannesburg, South Africa. Across the African continent, economies posted strong growth in foreign investment in 2024.
The latest World Investment Report from UN Trade and Development (UNCTAD) highlights a significant rebound in foreign direct investment (FDI) inflows to Africa.
In 2024, foreign investment in the continent shot up by 75% to reach $97 billion, representing 6% of global FDI, compared to a 4% share the year before.
The surge was largely driven by an international project finance deal for urban development in Egypt. Net of this increase, FDI in Africa still rose 12% to about $62 billion, comprising 4% of global inflows.
Investment facilitation efforts continued to feature prominently in Africa, accounting for 36% of policy measures favourable to investors.
Liberalization also remained a key component of investment policymaking in Africa and Asia, making up one fifth of measures adopted in 2024.
The report shows that European investors hold the largest FDI stock in Africa, followed by the United States and China.
Investment from China, valued at $42 billion, is diversifying into sectors like pharmaceuticals and food processing.
One third of projects linked to the Belt and Road Initiative, a global development initiative championed by the country, now focus on social infrastructure and renewable energy.
Foreign investment growth across Africa
In 2024, foreign investment went up across most African subregions, with North Africa leading the way.
Besides Egypt’s strong performance, FDI in Tunisia increased by 21% to $936 million and that of Morocco grew by 55% to $1.6 billion.
Across the continent, international project finance (IPF) deals rose 15% in value, fueled by large energy and transport infrastructure projects. In Egypt, IPF commitments more than doubled.
Project numbers, however, fell by 3%. Renewable energy was the only sector with notable growth, featuring seven major deals worth about $17 billion, including mainly offshore power cables and wind and solar plants in Egypt.
Other renewable energy projects occurred in Morocco, Namibia and Tunisia.
By contrast, greenfield investments declined in Africa, with announcements dropping 5% and value down 37% to $113 billion, compared with $178 billion in 2023.
Most countries saw fewer greenfield projects, except North Africa, where greenfield investments rose 12% to $76 billion, making up two thirds of the continent’s project capital expenditures.
Sector-wise, construction and metal products sectors saw the biggest increases in greenfield investment, while electricity and gas supply projects fell by $51 billion in value.
Cross-border mergers and acquisitions, typically around 15% of Africa’s FDI, turned negative.