Africa draws capital in a World of retreating investment: Egypt, Nigeria and South Africa lead a new investment geography

 Save as PDF

By AfricaHeadline | Global Economy

As global foreign direct investment (FDI) recorded its second consecutive annual decline, Africa emerged as one of the few regions bucking the trend. FDI inflows into the continent surged by 75% in 2024, reaching a record $97 billion, according to the latest UN Trade and Development (UNCTAD) World Investment Report. Even after excluding large one-off transactions, investment flows to Africa still increased by approximately 12%, at a time when global FDI fell by 11%.

The continent’s investment map reveals a significant concentration of capital in a handful of leading economies. Egypt attracted $10.5 billion in FDI, followed by Nigeria with $5.6 billion, South Africa with $5.2 billion, and Angola with $4 billion. Together, these four economies accounted for a substantial share of Africa’s total foreign investment inflows, underscoring a broader global trend in which capital gravitates toward larger markets, stronger infrastructure networks and reform-oriented economies.

Egypt’s performance stands out. The country has consolidated its position as Africa’s leading destination for foreign investment, benefiting from a population of more than 110 million people, a strategic location connecting Africa, Europe and the Middle East, and major investments in energy, logistics and urban development. Much of the increase was driven by large-scale projects backed by Gulf investors, highlighting the continued importance of infrastructure and real estate developments in shaping investment flows across emerging markets.

Nigeria retained its place among Africa’s top investment destinations, supported by its vast domestic market of more than 230 million people and growing opportunities in technology, financial services and digital infrastructure. Investors continue to view Africa’s largest economy as a long-term growth market, particularly as fintech, e-commerce and energy projects attract increasing levels of international capital.

South Africa, meanwhile, remains the continent’s leading financial hub. Despite persistent challenges including slower economic growth, electricity shortages and logistics constraints, the country continues to benefit from deep capital markets, sophisticated financial institutions and a diversified industrial base. Recent data indicate a rebound in investment activity, supported by increased foreign participation in local businesses and strategic sectors.

Beyond the continent’s traditional economic powers, a second tier of investment destinations is steadily emerging. Morocco, Ghana, Ethiopia, the Democratic Republic of Congo, Kenya and Mozambique each attracted between $2 billion and $4 billion in foreign investment, reflecting a gradual diversification of capital flows across Africa. In many of these markets, mining, renewable energy, agribusiness, manufacturing and digital services are increasingly complementing traditional commodity sectors.

The Democratic Republic of Congo deserves particular attention. With $3.1 billion in FDI inflows, the country continues to benefit from rising global demand for copper, cobalt and other critical minerals essential to the energy transition. As electric vehicle production, battery manufacturing and clean energy technologies expand worldwide, the DRC is becoming one of the most strategically important resource economies of the 21st century.

Regionally, North Africa emerged as the strongest driver of the continent’s investment growth. The sub-region recorded an increase of more than 270% in FDI inflows, fueled by major energy, industrial and infrastructure projects. Morocco, Algeria and Tunisia also benefited from their proximity to European markets, integrated industrial supply chains and increasingly competitive investment frameworks.

Africa’s investment momentum comes at a time of profound shifts in the global economy. Competition among the United States, China, the European Union and Gulf nations for access to critical minerals, strategic trade corridors, renewable energy assets and fast-growing consumer markets is reshaping investment patterns worldwide. As a result, Africa is becoming an increasingly important destination for global capital seeking long-term growth opportunities.

Yet despite the record inflows, Africa still accounts for only a small share of global FDI relative to its demographic and economic potential. The continent is home to nearly 20% of the world’s population but continues to attract a disproportionately low share of international investment compared with other emerging regions.

The broader lesson from the latest data is clear: Africa is attracting more capital than ever before, but investment remains concentrated in a limited number of countries and sectors. The next challenge for policymakers will be converting these inflows into industrialization, higher productivity, value-added exports and quality jobs. Without that transition, record investment figures may generate impressive headlines but fall short of delivering sustainable economic transformation.

Source: UNCTAD World Investment Report 2025 and UNCTADSTAT.