UNCTAD’s World Investment Report 2023 reveals that money invested from abroad into Africa dropped to $45 billion in 2022 from a record high of $80 billion in 2021. This made up 3.5% of the total global investment.
In North Africa, Egypt saw a big jump in foreign investment to $11 billion due to more companies buying and merging. The number of new projects announced more than doubled to 161. Deals for international projects also went up by two-thirds to $24 billion. However, investment in Morocco went down a bit by 6% to $2.1 billion.
In West Africa, Nigeria experienced negative foreign investment of -$187 million because some investors pulled out. But new projects increased by 24% to $2 billion. Investment in Senegal stayed the same at $2.6 billion, while Ghana saw a decrease of 39% to $1.5 billion.
In East Africa, investment in Ethiopia dropped by 14% to $3.7 billion, but it still received the second most foreign investment on the continent. Uganda’s investment went up by 39% to $1.5 billion due to investments in extracting resources. Tanzania saw an increase of 8% to $1.1 billion.
In Central Africa, investment in the Democratic Republic of the Congo stayed the same at $1.8 billion, mainly from investments in oil fields and mining.
In Southern Africa, foreign investment in South Africa was $9 billion, less than in 2021 but double the average of the last ten years. In Zambia, after two years of losses, foreign investment increased to $116 million.
Over the past five years, foreign investment has increased in four of the economic groups in Africa.
Investment in the Common Market for Eastern and Southern Africa went up by 14% to $22 billion. It also increased in the Southern African Development Community (rising four times to $10 billion), the West African Economic and Monetary Union (doubling to $5.2 billion), and the East African Community (up by 9% to $3.8 billion).
Generally, the destinations of FDI in Africa have shifted over the last decade, with Northern and Southern Africa—which made up the majority of FDI stock in the mid-2000s—losing FDI share to Eastern Africa.
Credit: GITFiC.com (2023 Investment index compilation)