Africa Sees 38% Drop in Foreign Direct Investment to $59 Billion in 2025
Africa's foreign direct investment (FDI) dropped 38% to $59 billion in 2025, continuing a downward trend observed earlier in the year. North Africa experienced a significant decline of 67%, while Sub-Saharan Africa showed more resilience with a 6% decrease to $42 billion. The UN Conference on Trade and Development highlighted uncertainty in future FDI flows due to geopolitical tensions and economic fragmentation.
Theia Market Signal Identification - AI Assisted
In 2025, Africa attracted $59 billion in foreign direct investment (FDI), a decrease of 38% from the previous year, according to the UN Conference on Trade and Development. The decline confirmed a downward trend noted in the first half of the year, where FDI inflows fell 42% to $28 billion.
In contrast, FDI to other developing economies outside Africa fell only 2% to $877 billion. Globally, FDI increased by 14% to approximately $1.6 trillion, but without transit flows, the growth would have been about 5%.
North Africa saw a drastic drop of around 67% in FDI, from $51 billion in 2024 to $17 billion in 2025, heavily influenced by the absence of the Ras El-Hekma megaproject. Sub-Saharan Africa showed more resilience, capturing $42 billion in FDI, down 6% year-on-year.
South Africa faced negative net inflows of $6 billion due to divestments, while Mozambique experienced an 80% increase in FDI, driven by liquefied natural gas projects. A total of 639 greenfield projects were announced, a 5% increase from 2024, primarily in Egypt and Ivory Coast. UNCTAD notes uncertainty in FDI flows for 2026 amid geopolitical tensions and economic fragmentation.
Comments