Following a record 75% rise in foreign direct investment (FDI) in 2024, the first half of 2025 has seen a 45% decline in inflows. The figures are skewed by the construction of a new Egyptian administrative capital, which accounted for around 63% of African FDI in 2024, leaving a net growth of 12% for the rest of the continent, supported by investment reforms and improved facilitation across the continent, according to the 2025 Unctad World Investment Report. This represents around $62 billion in FDI, or 4% of global inflows. Project numbers, however, fell by 3%. Renewable energy was the only sector with notable growth, featuring seven major deals worth about $17bn, including mainly offshore power cables and wind and solar plants in Egypt. Other renewable energy projects are being built in Morocco, Namibia and Tunisia, according to Unctad figures. The focus on Egypt continues, with the country attracting around $9bn in FDI during the first half of 2025, driven by growing interest from Gulf, European and Asian investors in the country’s construction, infrastructure and green energy sectors. The rest of the continent has been affected by a 3% fall in global FDI in the first half of 2025, with little hope of revival in the second half. “Trade tensions, geopolitical risks, regional conflicts and supply-chain derisking will continue to weigh on global investment flows through the rest of 2025,” states Unctad in its October Global Investment Trends Monitor. There was a 42% drop in African FDI projects during the first half of the year. Excluding the Egyptian mega project, there was an 8% decrease. In contrast, flows increased in developing Asia (+7%) and Latin America and the Caribbean (+12%). Investment values in the primary sector and related industries in manufacturing (coke and refined petroleum) and services (energy and gas supply) dropped by 76% in Africa, as part of a global decrease of 17%. Greenfield projects dropped by 58%. The exception was Namibia, which ranked first in Africa and second globally in the 2025 Greenfield FDI Performance Index, moving up 10 places from the previous year. There are some other bright spots. Two major battery storage projects attracted International Project Finance (IFP) deals. They are a 10 MW/20 MWh facility in Somalia, sponsored by National Energy Corp (Canada), and the Dasa BESS project in Niger, which involves the construction of a 15 MW/ 37.5 MWh battery storage facility, sponsored by Global Atomic Corp (Canada). ER
