• Egypt remains continent’s largest investment recipient
• UN says despite attracting investment in strategic industries, Africa fails to transit into broader industrial devt
Ndubuisi Francis in Abuja
The African continent attracted about $70 billion in foreign direct investment (FDI) as global FDI rose six per cent to $1.6 trillion in 2025, ending two consecutive years of decline.
That was according to the just-released World Investment Report 2026 by the UN Trade and Development (UNCTAD).
The report disclosed that Africa was attracting investment in strategic industries but faced the challenge of not turning same into broader industrial development.
The report revealed that Africa’s $70 billion FDI in 2025 was the third-highest level since 1990, and remained roughly one-third above the continent’s long-term average.
According to the World Investment Report, $70 billion 2025 FDI inflows to Africa was below the exceptional $94 billion 2024 record, when a small number of large transactions boosted regional totals.
Egypt remained Africa’s largest FDI recipient, with inflows of about $15 billion, helping the North Africa sub-region to remain the continent’s largest recipient, despite a sharp decline from the exceptional 2024 level.
The report said at a time when competition for investment was increasingly centred on energy, infrastructure, technology and critical resources, Africa continued to attract investor attention, including from the Gulf and other Asian economies.
It stated, “The question is whether that interest can translate into broader economic gains.
“Despite a decline from the exceptional level reached in 2024, inflows remained roughly one-third above the continent’s long-term average.
“Greenfield project values fell by almost one third, but the number of announced projects increased, pointing to broader engagement through smaller projects.
“Investors from the Gulf and other Asian economies are becoming important sources of greenfield investment, especially in energy, logistics, real estate and infrastructure.”
The report added, “African LDCs (Least Developed Countries) received about $33 billion in FDI, with inflows concentrated in a few economies linked to natural resources, energy, infrastructure and selected manufacturing projects.
“Energy, infrastructure and critical minerals are drawing investment, but benefits remain concentrated in a limited number of countries and sectors.”
The report underscored the fact that
much of the investment interest in Africa was focused on sectors that were becoming more important in the global economy. This, the report stated, reflected three overlapping drivers: demand for energy infrastructure, interest in critical minerals needed for batteries and advanced manufacturing, and the search for new industrial and logistics locations as supply chains were reconfigured.
According to the report, “Parts of Africa are well positioned to benefit from these trends. The continent holds major reserves of minerals essential for renewable energy technologies, battery manufacturing and advanced industrial production.
“Copper, cobalt, lithium, manganese, graphite and rare earth minerals are becoming increasingly important to global investors seeking to secure future supply chains.
“Countries such as Egypt, Morocco and South Africa continued to attract investment linked to industrial development, hydrogen production, logistics and renewable energy.
“Namibia and other resource-rich economies are drawing attention as demand rises for minerals needed in batteries, renewable energy systems and advanced manufacturing.”
UNCTAD stated, “These trends position parts of Africa within some of the fastest-growing segments of global investment.
“However, the benefits remain uneven. Investment continues to be concentrated in a relatively small number of countries and sectors, leaving many economies with limited participation in the activities attracting the most capital.”
The UN agency stated that for developing countries, the new investment landscape brought both opportunities and risks. It added that many countries risked being left behind as investment became more capital-intensive, technology-intensive, and shaped by policy support that many developing economies could not easily match.
According to the agency, developing countries need more than investment promotion to compete in this environment.
“They need realistic entry points into evolving value chains, stronger investment facilitation, reliable infrastructure, workforce skills, supplier development and regional markets that make projects more viable,” the report said.
It added, “International cooperation will also be needed to ensure that investment partnerships support both resilience for investors and development priorities for host economies.”
It said prospects for 2026 remained difficult as trade policy uncertainty, geopolitical tensions, conflicts, high financing costs, and economic fragmentation continued to weigh on investment decisions.
