Foreign direct investment (FDI) in Africa has been dynamic, with strong fluctuations and optimistic forecasts.

After peaking at $83 billion in 2021 and falling to $45 billion in 2022, UNCTAD projects FDI flows will recover by around 5% in 2023–2024 as global conditions improve and new regional initiatives launch.

Key investment hubs remain COMESA ($22 billion), SADC ($10 billion), WEMU ($5.2 billion), and the East African Community ($3.8 billion).

China, the UK, France, and the Netherlands are leading investors, with China’s FDI and trade set to further expand, underpinned by new industrial parks and logistics corridors .

Sector-wise, energy and gas remain dominant, with $120 billion in new projects announced for 2022.

There is also accelerated growth in renewable energy, with major investments in wind, solar, and hydro.

Countries like Mozambique, Ghana, Angola, and Senegal are increasing their green energy capacities, with Mozambique sourcing 81% of its electricity from hydropower and targeting further expansion by 2030 .

The digital and fintech sectors are surging; Africa’s fintech revenues are projected to reach $30 billion by 2025, and tech startups raised $1.4 billion in just the first nine months of 2023.

Startups like Flutterwave, M-KOPA, and Andela, supported by global partners including Amazon and Visa, are examples of Africa’s rapid digital transformation .

In healthcare, FDI continues to grow as pharmaceutical spending could double by 2040.

Companies like Kelix bio invest in vaccine manufacturing, while digital health startups and infrastructure initiatives—such as Altron HealthTech collaborations—mark rapid sectoral innovation .

Several African entities are active in FDI partnerships: Egypt’s Sovereign Fund works with renewables investors, Kenya’s Ministry of Trade partners with UAE logistics and tech firms, while the Tanzania Investment Centre simplifies investment for foreign partners.

Global multinationals remain highly active.

Foreign direct investment (FDI) in Africa has been dynamic, with strong fluctuations and optimistic forecasts.

Title:

Content: Centurion Law Group Navigates Legal, Regulatory And Tax Frameworks At African Energy Week (AEW) 2023

(MENAFN- African Press Organization)

A Technical Track hosted by pan-African legal and business advisory group, Centurion Law Group, held during the 2023 edition of African Energy Week (AEW) ( ) – taking place in Cape Town from 16-20 October – explored the legal, regulatory, and tax frameworks throughout Africa.

The technical track kicked off with opening remarks by Centurion Law Group Managing Director and Partner, Zion Adeoye, who moderated the session and spoke on Africa's position as one of the world's most attractive destinations for investment and how legal and regulatory frameworks are being put in place to advance local content development in the continent's energy sector.

“Africa remains one of the most attractive destinations for investment,” Adeoye stated, adding,“It is very clear that for the next two to three decades, oil and gas development will be very active. In Africa, local content manifests in several ways – shareholding in the company and utilizing local manpower. In the extractives industry, investors always have the problem of balancing the best hands to work on their projects and adhering to local content laws in terms of getting the right content barriers across the industry.”

Following the presentation, a panel featuring the participation of international legal representatives from Mauritius, South Africa, Equatorial Guinea, Guinea, Russia, South Sudan, Ghana, and Nigeria explored the regulatory and legal frameworks throughout the continent and abroad.

“In Mauritius, we allow investors to engage in transactions more easily in Africa,” stated Keseena Chengadu, Head of Investment at Centurion Law Group, adding,“It's good to use us as a hub when internationals want to invest in Africa. We offer assistance to internationals with engaging in transactions, which can be very challenging.”

“South Africa is comparatively significantly industrialized, and it results in a few advantages for potential investors,” stated Gari Matarirano, Energy and Infrastructure Attorney at Centurion Law Group, when speaking on the southern African country, adding,“First off, the reliability of professional service firms, the tax system, is quite sophisticated with a strong source of funding through the financial system.”

“In Ghana, we have a robust regulatory framework,” stated Yorm Ama Abledu, Senior International Attorney at Centurion Law Group, adding,“As lawyers, we are able to guide clients and allow them to speak with the right authorities to deal with so that they are compliant with the law.”

The speakers spoke on local content development laws in Africa, highlighting the benefits and challenges related to investing in the continent while adhering to specific laws that could require as much as between 25% and 40% local participation.

“The markets are not very saturated, but the population is constantly growing, so it's a nice place to invest. But the fear of an investor is that they have to give up an average localization percentage of 25%,” stated Alexey Khromov, Law Intern at Centurion Law Group, adding however that,“The Government should think in the best interest of the communities, but also think about how to make your country more attractive as an investment destination.”

“In South Sudan, the country has given opportunities for foreign investors in terms of employment, but our investment promotion and requirement laws required 80% national workers in any company engaging in the country,” stated Rachel Tanda, Attorney at Centurion Law Group.

Additionally, Tamara Jombai, Attorney at Centurion Law Group touched on the individual requirements for companies seeking to participate in African markets, stating that,“When you are coming into a country, you need to decide on the size of the company and the kind of project you will be doing, which will determine what you will do.”

Furthermore, it was noted during the panel discussion that African countries feature diverse and robust taxation agreements, with Mauritius boasting 46 double taxation agreements across the world, which serves to help entities do business throughout the continent while using Mauritius as a hub. Meanwhile, the determination of doing business in South Africa is made in accordance with common law principles, wherein a foreign company engaging in the southern African country is subject to codified rules for certain types of income such as dividends, royalties, and interest.

Speaking on South Sudan's tax regulations, Grace Yella, Director for the Economic and Monetary Community of Central Africa at Centurion Law Group stated that,“There is a wide range of options for investors to settle business in the East African region. Each country has particularities when it comes to tax. The similarity is they opt for each investor to have the possibility to have their own declaration – they choose what to pay as tax. The authorities then have to carry out investigations to confirm that what has been submitted correlates to your commitments.”

The panel closed off by noting that Africa is diverse in its legislation and regulatory requirements, highlighting that international investors seeking to do business in the continent are subject to a variety of frameworks. With a burgeoning energy sector and fast-growing population, the panelists noted that Africa's growing industries and economies will continue to serve as a promising investment destination for international firms.

Under a mandate to make energy poverty history by 2030, AEW 2023 kicks off its strategic program on 17 October, and will unite African energy policymakers and stakeholders with global investors to discuss and maximize opportunities within the continent's entire energy sector.

Distributed by APO Group on behalf of African Energy Week (AEW).
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After peaking at $83 billion in 2021 and falling to $45 billion in 2022, UNCTAD projects FDI flows will recover by around 5% in 2023–2024 as global conditions improve and new regional initiatives launch.

Title:

Content: Global investment in upstream oil and gas is set to reach $570 billion in 2024, showing a 7% rise compared to 2023 expenditure. Of this, 33% is expected to be directed towards frontier fields, presenting a strategic opportunity for undeveloped oil and gas markets in Africa. With lack of investment representing one of the biggest challenges to project development across the continent, the African Energy Chamber (AEC) (www.EnergyChamber.org) will host a networking reception on July 11 in London – Europe’s financial capital. Taking place at the Four Seasons Hotel London at Park Lane from 17:00 to 21:00, the reception bridges the gap between European financiers and African energy projects, promoting synergies, deals and future collaborations.

Despite holding some of the largest untapped oil and gas resources worldwide, Africa is faced with an energy crisis, with 600 million people currently living without access to electricity and 900 million people without access to clean cooking solutions. The African Development Bank estimates that to address this crisis, the continent requires between $40 billion and $70 billion in annual investment. Presently, Africa receives on average $35 billion in global financing for fossil fuels and clean energy projects, with merely 5% of global energy investment directed towards the continent. This showcases a clear investment gap and a strategic opportunity for European funders and project developers.

With over 125 billion barrels of proven crude oil, 620 trillion cubic feet of natural gas and abundant opportunities in solar, wind and geothermal, Africa continues to attract investment from some of the world’s biggest players. The continent’s greenfield upstream spending, for example, is projected to reach $37 billion by 2025 and $50 billion by 2050, with companies eager to unlock the full potential of undeveloped oil and gas. Specifically, a strong slate of London-based oil and gas firms are driving a wave of project developments across the continent.

These include energy major bp, who is developing Senegal and Mauritania’s inaugural LNG project – the Greater Tortue Ahmeyim (GTA) facility – and Mozambique’s Coral Sul FLNG project. GTA is on track for first production in 2024 while bp delivered first gas from Coral Sul in 2022, marking the first LNG cargo for the country. Additionally, energy major Shell is making strides towards opening up the Orange Basin in Namibia. The company’s Graff-1 discovery in 2022 was play-opening and Shell has made an additional five discoveries since then. The company is investing 25% of its deepwater exploration budget in the country this year.

Additionally, independent hydrocarbon producer Perenco inaugurated the $50 million Batanga LPG plant in 2023 and is developing the $1 billion Cap Lopez LNG terminal in Gabon. The company is also investing in shallow-water and marginal assets across the continent, acquiring Eni’s core assets in the Republic of the Congo in June 2023 for $300 million. Oil and gas company Tullow Oil anticipated commercial oil production in Kenya in 2028 while transitional energy company Chariot oil and gas recently signed a gas commercialization agreement with Vivo Energy in Morocco. These developments – all led by London-based companies – represent just some of the many underway across the continent.

The AEC Reception builds on these deals to promote new investment in African energy. Taking place in London – both Europe’s financial capital and its biggest stock market – the reception is all about connecting companies to opportunities. The total value of companies listed on the London Stock Market reached $2.18 trillion in June 2024, highlighting a commercial and strategic opportunity for the reception and African energy projects.

The AEC London Reception takes place ahead of the continent’s largest energy event, the African Energy Week (AEW): Invest in African Energy conference, scheduled for November 4-8 in Cape Town. Under a mandate to make energy poverty history by 2030, the event unites global investors and technology providers with African energy projects, with discussions tailored around unlocking high returns and generating mutually beneficial opportunities. Participants at the AEC’s London Reception have the chance to gain exclusive insight into AEW: Invest in African Energy 2024 while engaging with a suite of African stakeholders.

This year’s AEW: Invest in African Energy will host the African Energy Finance Summit – a platform that galvanizes financial support for African energy projects, while promoting deal-signing and partnerships. Hosted in partnership with multilateral financial institution the African Export-Import Bank and global market intelligence firm S&P Global Commodity Insights, the summit brings capital to Africa with the aim of making energy poverty history by 2030.

Don’t miss the chance to be at the forefront of Africa’s energy transformation. Register for the AEC’s London Reception at https://apo-opa.co/3KUx0qt or contact register@aecweek.com.

AEW: Invest in African Energy is the platform of choice for project operators, financiers, technology providers and government, and has emerged as the official place to sign deals in African energy. Visit www.AECWeek.com for more information about this exciting event.

Distributed by APO Group on behalf of African Energy Chamber.

What was the total FDI inflow to Africa in 2022 and how did it compare to 2021?

$45 billion, which was down from $80 billion in 2021

Key investment hubs remain COMESA ($22 billion), SADC ($10 billion), WEMU ($5.2 billion), and the East African Community ($3.8 billion).

Title:

Content: AFED: EGYPT RECEIVED $5.1 BILLION INVESTMENTS IN 2021
GDP growth is expected to rise to 4.4% this year
Abdulrahman Abu Al-Enein
6: 52 AM, Wednesday, 31 May 23
Recent data issued by the African Development Bank (AfDB) revealed that Egypt ranked second in terms of foreign direct investment flows in the continent in 2021 and attracted nearly $5.1 billion.
According to the Africa Economies Outlook 2023, South Africa was the largest recipient of foreign direct investment in 2021 with investments of more than $40.9 billion, nearly half of the total inflows to the continent in that year, followed by Egypt and Mozambique, which each attracted nearly $5.1 billion, representing about 6.2% of the total volume.
In the same context, the report expected Egypt ’ s GDP growth rate to decline to 4.4% this year from 6.6% estimated last year, and to rise to 5.1% next year.
The report pointed out that the inflation rate rose from 4.5% in the fiscal year 2020 / 2021 to 8.5% in the fiscal year 2021 / 2022 due to the rise in food and energy prices globally and the devaluation of the pound against the dollar.
He said that the current account deficit shrank to 3.5% of GDP in the fiscal year 2021 / 2022 compared to 4.4% in the previous fiscal year 2020 / 2021 due to the rise of tourism revenues to 10.7 billion dollars against 4.9 billion dollars, respectively.
The African Development Bank pointed out that the banking sector remains profitable and well capitalized, noting that the rate of non-performing loans reached 3.2% in June 2022, explaining that subsidies and social protection programs have reduced the impact of high food and energy prices on vulnerable families.
The Minister of Planning Hala Al-Said said in previous statements that despite the current effects of the Russian-Ukrainian crisis, which is likely to spread over the next year, the Egyptian economy is expected to grow by 4.2% by the end of the current fiscal year 2023-2022.
Al-Saeed said that with the development of inflationary trends in the Egyptian economy and despite the success of the state in curbing it and reducing it from very high levels (25% in 2017-2016) to less than 5% in 2021-2020, the rate increased to about 15% in 2022, and continued to rise, especially after the Russian-Ukrainian crisis.
Foreign direct investment in Mozambique increased by 68% in 2021, the report said, noting that these investments were largely directed to green projects in the energy sector.
Nigeria accounted for 5.8% of FDI inflows to Africa and Ethiopia 5.1% despite economic challenges.
The bulk of foreign direct investment in these countries is increasingly going to clean energy resource projects.
Mauritius and South Africa recorded the largest outflows in 2021, but a few countries recorded net inflows, including Egypt ($18 billion) and Nigeria ($5.9 billion).
The Bank estimates that capital flight through net investment outflows continued in 2022 at around $28 billion, which is close to the 2021 level due to higher interest rates linked to deflationary monetary policies in developed countries.
Official development assistance (ODA) to Africa stabilized at $65 billion in 2021 after the previous 28 percent jump in 2020.
The significant increase in such assistance since 2020 reflected the support provided by the international community to help African governments address the humanitarian, social and economic impacts of the coronavirus epidemic and the difficult global economic conditions.
The African countries that saw the largest increase in ODA in 2021 included Egypt (428%), Equatorial Guinea (115%), Angola (109%), Gabon (82%) and Sudan (60%).
The report pointed out that official development assistance to Egypt during 2021 amounted to about 8.2 billion dollars, Ethiopia 4 billion dollars, Sudan 3.8 billion dollars, the Democratic Republic of the Congo 3.5 billion dollars, Nigeria 3.4 billion dollars, and Kenya 3.1 billion dollars.
African countries need to leverage this external support to address existing vulnerabilities and build more resilient economies, given the risks that advanced economies are reallocating resources for reconstruction and humanitarian assistance in Ukraine at the expense of meeting the continent ’ s official development assistance commitments.
Ukraine received $16.1 billion in net official development assistance (ODA), equivalent to 7.8 percent of the total aid resources provided last year.
It is noteworthy that the report was launched in light of the annual meetings of the African Development Bank Group held under the auspices of President Abdel Fattah El Sisi in Sharm El Sheikh from 22 to 26 May.

China, the UK, France, and the Netherlands are leading investors, with China’s FDI and trade set to further expand, underpinned by new industrial parks and logistics corridors .

Title:

Content: ADVERTISEMENT

Tanzania is fast becoming one of the best investment destinations in the world

  • The number of registered projects in Tanzania increased by 128%, in February.
  • A total of 41 projects were registered across the country.
  • e 7,370 jobs expected from the new projects portray a 493% increase over those created by projects registered in February 2022.

Tanzania's pro-business stance, perpetrated by the President of the country, Samia Suluhu Hassan is sending a positive message to investors, who are increasingly choosing Tanzania as their preferred investment destination, with the number of registered projects increasing by 128%, according to the most recent data.

The aforementioned data which was released by the Tanzania Investment Centre (TIC) shows that in February 2023, a total of 41 projects were registered across the country. This represents a 128%increase compared to 18 projects that were registered in February 2022.

Projects registered in February 2023 had a total value of $339.2 million (over Sh780 billion) and were expected to create 7,370 jobs. This reflects a 347% growth over the $75.9 million in capital estimated to be pumped into the country's economy in February 2022.

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Likewise, the 7,370 jobs expected from the new projects portray a 493% increase over those created by projects registered in February 2022.

The TIC executive director Gilead Teri noted via the TIC’s Monthly Investment Bulletin for February 2023 that through President Samia’s initiative to simplify business license registration, coupled with her devotion to growing the investment portfolio of the country, Tanzania has been able to become the attractive investment destination it is in her young tenure so far.

He stated, “apart from devoting considerable attention to supporting investors, the administration of President Samia Suluhu Hassan has streamlined licenses and permits procedures through implementing the Blueprint for Regulatory Reforms.”

He also noted that the government has increased its use of automation in compliance processes in recent months. It has also rationalized institutions to reduce duplication and simplified the process of acquiring land for investment purposes.

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President Hassan recently moved the investment docket from the Ministry of Industry and Trade to the President's Office in an effort to further transform Tanzania's investment landscape.

Additionally, the value of capital expected to be invested has increased by 413%, rising from $66 million in January to $339 million in February of this year.

Transportation remained the most capital-intensive sector, followed by agriculture, manufacturing, tourism, and commercial buildings. Transportation emerged as the leading sector in attracting investment in February 2023, with projects worth $156.17 million.

In February 2023, it accounted for 46% of the total value of projects registered. Agriculture came in second with $90.20 million, accounting for 27%, while manufacturing received $53.68 million, accounting for 15.8%.

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Tourism projects were valued at $29.02 million, while commercial buildings brought in $10.15 million, representing 9% and 3% of the total.

Manufacturing, tourism, and agriculture emerged as the top three leading sectors in attracting foreign direct investments (FDIs).

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Which sectors are Chinese investments in Africa focusing on?

Sector-wise, energy and gas remain dominant, with $120 billion in new projects announced for 2022.

Title:

Content: Chairman of the Board of Directors and Editors
I'm sorry.
Mohamad Elbaz
Chairman of the Board of Directors and Editors
I'm sorry.
Mohamad Elbaz
It has reached $11 billion.
UN highlights doubling of foreign direct investment in Egypt
The United Nations Trade and Development Board (UNCTAD) said in its annual report on foreign direct investment flows for the year 2022, on Wednesday in Geneva, that Egypt witnessed an increase in foreign direct investment more than doubled to $11 billion as a result of increased cross-border M & A sales.
Investment flows to Africa fell to $45 billion in 2022 from a record $80 billion in 2021 and accounted for 3.5 percent of global foreign direct investment, the report said, adding that international project financing deals targeting Africa showed a 47 percent drop in value.
The report pointed out that the number of announcements of new projects increased by 39% to 766, and that six of the 15 largest new investment mega projects (those worth more than $10 billion) announced in 2022 were in Africa, stressing that Egypt witnessed an increase in foreign direct investment more than doubled to $11 billion as a result of increased cross-border M & A sales.
The number of new projects has more than doubled to 161, and the value of international project financing transactions has increased by two-thirds to $24 billion.
FDI inflows have risen over the past five years in four of the continent ’ s regional economic groupings, with FDI in the Common Market for Eastern and Southern Africa (COMESA) growing by 14% to $22 billion, and inflows also rising in the Southern African Development Community (SADC) (quadrupled to $10 billion) and the West African Economic and Monetary Union (WEMU) (doubled to $5.2 billion). East African Community (up 9% to $3.8 billion).
According to the report, the largest increase in 2022 was in new field projects announced in energy and gas supply (to $120 billion from $24 billion in 2021), and the value of projects in construction and extractive industries rose to $24 billion and $21 billion, respectively, while the information and communication sector recorded the largest number of projects.
European investors remain by far the largest owners of FDI in Africa, led by the United Kingdom ($60 billion), France ($54 billion) and the Netherlands ($54 billion).

There is also accelerated growth in renewable energy, with major investments in wind, solar, and hydro.

Countries like Mozambique, Ghana, Angola, and Senegal are increasing their green energy capacities, with Mozambique sourcing 81% of its electricity from hydropower and targeting further expansion by 2030 .

Title:

Content: The “green ” energy transition announced by the European Union in the name of combating global climate change requires a huge amount of cheap resources to deploy a network of renewable energy sources (RES).
Therefore, environmentally concerned politicians not only of the EU, but also of the United States, once again turned their eyes to Africa, where China is already in full control.
Bidding for Africa
Ivan Shilov © IA REGNUM
These countries are placing a big bet on Africa, hoping to meet the growing demand for renewable energy and at the same time promising the continent fantastic economic growth.
It is possible to buy green electricity from African countries: according to current estimates, solar power generation is 10 TW, hydropower - 350 GW; wind power - 110 GW.
Mozambique is considered one of the greenest countries in the world - it receives 81% of its electricity from hydropower.
However, much of Africa's energy resources remain largely untapped.
This is where foreign investors put their feet.
With the help of international consulting and investment agencies, they estimate that Ethiopia has solar and hydropower capacity of more than 60,000 MW, while in South Africa, the potential for wind power is estimated at 67,000 GW.
Having adopted the rules of the game of potential investors and decided that renewable energy is the source of their enrichment, some African countries have set themselves goals in the field of green energy development.
By 2030, Ghana aims to increase the share of its national “green ” energy balance from 42.5 MW to 1,363 MW, Angola is ready to use RES by 70% by 2025, and Senegal is doing everything possible to increase the share of RES in the country ’ s energy balance to 30% by 2030.
Windmills
Myriams-Fotos
The Paris climate agreement has forced many African governments to take the climate agenda more seriously, leading to the inclusion of RES provisions in national legislatures, including reforms aimed at encouraging foreign direct investment and private business participation in the process.
Paradoxically, for all the attractiveness of the African continent for “green ” investors, African countries are experiencing an energy crisis: currently more than 600 million people do not have access to electricity, and more than 900 million people do not have access to clean fuels for cooking.
Energy demand is growing every year across the continent due to population growth, with developing countries expected to account for more than 90% of the world ’ s population growth by 2050.
Electrifying their own territories has become a priority for many African governments, which requires significant investment, and here the whole calculation is on foreign investors.
It should not be forgotten that Africa is the second largest mining industry in the world, with many countries of the continent dependent on exploration and mining.
Already, the “green ” energy transition is orienting this industry towards the extraction of elements necessary for the production of electric vehicles, batteries and other clean energy technologies.
Although nearly 50% of South Africa ’ s export value comes from the development and trade of fossil fuels, the main focus is shifted to nickel, copper and cobalt mining – these minerals serve as important components in renewable energy technologies, and demand for them is expected to grow exponentially in the coming decades.
Countries rich in copper and nickel, such as the Democratic Republic of the Congo, Zimbabwe and Zambia, are likely to be especially loved by foreign investors.
To understand what promises these investors entry to the continent, it is enough to study the latest data on the size of mineral deposits, so necessary for the production of renewable energy.
Zimbabwe boasts the world ’ s second largest platinum deposit (2.8 billion tons) and rich chrome ore deposits (10 billion tons), as well as Africa ’ s largest lithium deposit.
The mining sector of the country is estimated at $12 billion a year.
With the growing demand for batteries, Zimbabwe is poised to become one of the world ’ s largest exporters of lithium, and is currently developing four major industrial projects.
Lithium
Dnn87
Another contender for an investment boom is Zambia, which has about 6% of the world ’ s proven copper reserves, as well as some of the richest deposits in the world, making the country the seventh largest copper producer in the world.
In addition, Zambia has prospects for uranium, gold, coal and diamonds.
The resources of the Democratic Republic of the Congo are estimated at tens of trillions of dollars - these are unused reserves of gold, cobalt, diamonds and high-quality copper.
In 2019, this South African country produced a total of 100,000 metric tons of cobalt, accounting for 70% of global production.
The country boasts some of the highest quality copper deposits in the world.
According to an E & Y report titled “Africa ’ s Attraction Program, ” Africa ’ s young, vibrant population and significant economic potential make it a tidbit for foreign investors.
However, the extraction of minerals and the construction of power plants does not mean that the lives of the African
Rather, it means more exploitation of cheap labor and enrichment of decision makers on how to dispose of the natural resources of their States.
Read earlier in this story: Africa is waiting for the irreversible consequences of the European green course
Read the development of the plot: Copper mining companies in Zambia plan to attract to gold mining

The digital and fintech sectors are surging; Africa’s fintech revenues are projected to reach $30 billion by 2025, and tech startups raised $1.4 billion in just the first nine months of 2023.

Title:

Content: When asked for his views on diversification as a strategy for portfolio management, Warren Buffett responded, “diversification is protection against ignorance”. Instead of a diversified portfolio, the Oracle of Omaha famously prefers a concentrated one, composed of a few sectors he has rigorously studied.

The UK’s investment strategy for the African continent is seemingly straight out of the Buffett playbook. As of 2020, the UK holds $65bn in total foreign direct investment (FDI) stock in Africa, second only to China. The vast majority of the portfolio is in oil, gas, mining and financial services.

In 2022 five new oil and gas deals worth £2.1bn were struck at the UK-Africa summit. In stark contrast, just £161m (8% of the total summit commitments) were invested in clean energy. One may agree with the UK’s strategy, suggesting that there aren’t many other high-yield investments to be made other than in oil majors, legacy miners and grey-haired banks. And besides, who would disagree with Buffett’s dictum? He is the sixth-wealthiest person in the world after all.

The truth of the matter is that Buffett would not be as wealthy as he is without adapting to changes in market trends, technologies and geopolitics. In May he sold his remaining stake in chip manufacturer TSMC due to geopolitical considerations (TSMC is based in Taiwan). A concentrated portfolio does not mean a stagnant one. It is this insight that the UK is overlooking, setting itself up to miss opportunities in those new industries rapidly taking shape across the world’s youngest and most promising continent.

Two trends are shaping markets across the continent. One of these is the adoption of financial technologies and the other is increased demand for healthcare, a consequence of Africa’s population boom and rising standards of living.

Fintech sector

McKinsey, a consultancy, estimated that revenues in the African fintech sector could surge eight times their current value to $30bn by 2025. Between 2020 and 2021 alone, the number of tech start-ups tripled to 5,200 companies. In 2021, seven of the 10 newly minted African unicorns (private companies valued over $1bn) are fintechs. As more Africans get connected and as digital identification verification models mature, fintechs will scale and profits will follow.

The second sector is pharmaceuticals. As Africa’s population grows and incomes rise, more money will be spent on healthcare. Within this sector, the Covid-19 pandemic laid bare the worrisome state of Africa’s vaccine and therapeutic manufacturing capabilities. Estimates vary, but some assessments forecast vaccine demand to double in volume from about 1-billion doses now to more than 2.7-billion doses by 2040. Industries adjacent to pharmaceuticals such as logistics, packaging and protective equipment are likely to cash in on increased private and public healthcare expenditure.

There are some positive signs that the newly revamped British International Investment (BII), formally the Commonwealth Development Corporation, is adjusting its investments because of these market trends. In 2020, the BII made a $150m investment in Kelix bio, a pan-African pharmaceutical platform focusing on manufacturing and marketing. It also executed a $20m, four-year structured credit deal with Moove, a fintech company that provides customers with cheaper access to vehicles.

Risk premium

These steps are positive but they are small. Inward FDI for Africa remains pitiful. Last year set a record for the continent, bringing in $83bn. To put this in context, the City of London in 2020 hit $831bn in FDI (10 times that of a continent of 54 countries), according to the Office of National Statistics.

What to make of this all? At least two insights. First, the UK should look to new sectors, taking bold bets in companies leading the fintech and pharmaceutical sectors. The second insight is that Africa’s risk premium is overpriced. There is opportunity beyond the industries of the 20th century; one just needs to look for them.

• Nott works for a venture facility for public benefit and is based in London. He writes in his personal capacity. You can follow his writing on Twitter @TheAfricaBrief.

Picture: 123RF

Which sectors are Chinese investments in Africa focusing on?

Startups like Flutterwave, M-KOPA, and Andela, supported by global partners including Amazon and Visa, are examples of Africa’s rapid digital transformation .

Title:

Content: Is Africa a good place to start a business?

Africa is experiencing a technology boom: the rapid penetration of Internet and mobile technologies make this region more and more interesting for IT entrepreneurs, despite the specificity and heterogeneity of the market.

IT in Africa

The African continent is a large market, as well as a source of direct access to a large audience with smartphones and a wide range of resources. The region is rich in coal, oil, ferrous metal ores, graphite, aluminum, and phosphate and consists of 54 countries, extremely diverse in terms of population, digitalization, economy, and purchasing power. Since January 2021, the continent has had a free trade zone between the countries of the African Union.

The market entry threshold is low, there is no fierce competition, and the potential for growth and demand for technology projects is enormous: the region has many problems that can be solved through innovation.

The continent has a crazy rate of Internet development and a native love of smartphones. You can buy bananas on the street and pay with your mobile account.

Students are often interested in starting their businesses. More often than not, students choose completely new locations and new startup ideas. We recommend that you consider Africa for your business because in a few years it will bring you success. But first, we recommend visiting Africa as a tourist to get a feel for the atmosphere. If you got carried away with preparing for a trip to Africa and forgot to write a research paper on time do not panic. After all, it’s no trouble, because a student service will always come to your aid. So if you’re wondering if you can pay someone to write my paper, always go to the WritingAPaper service. Its experts will help with any academic paper, and you will have time for exciting trips.

By 2025, experts predict Africa’s Internet economy should reach 5.1% of GDP – about $185 billion. FinTech, AgroTech, eCommerce, InsureTech, HealthTech, and CleanTech are considered the most in-demand areas.

According to research firm Briter Bridges, venture capital investment in African startups totaled $1.31 billion in 2021, most of which came from fintech projects. Kenya, Nigeria, and Egypt are considered to be the drivers of the region’s venture capital ecosystem: projects from these countries have received the most investment over the past few years compared with their neighbors on the continent. More than 30% of the continent’s technology hubs are concentrated here.

“The GDP of the entire region is $6.8 trillion. If Africa were a single country, it would be fourth in the world after China, the U.S., and India. Undoubtedly, the economic power of the region is still small, but in the next 30-50 years, it is predicted a stable growth in the range of 6-12% per year, and this process will be accompanied by the creation of new industries and businesses.

GDP per capita in terms of purchasing power parity in Africa is $5.2 thousand, for comparison, in the Russian Federation – $29.4 thousand, in the USA – $68.3 thousand, in Europe – about $41 thousand. However, in the top 20 fast-growing economies of the world, six lines are African countries: Benin, Ghana, Ethiopia, Tanzania, Rwanda, and Cote d’Ivoire. The main technological hubs on the continent are concentrated in South Africa, Nigeria, and Egypt.

The level of development of the IT market in Africa is 5-10 years behind other countries. Until now, only 28% of the continent’s population has access to the Internet, but in the last few years, the situation is gradually changing. Now the digital industry in Africa is actively developing, and the international market is noticing this trend.

African Accelerators & Incubators

There are more than 600 technology centers in Africa, among them incubators, gas pedals, and co-working spaces for companies. One of the most famous technology centers is the CcHUB. It is located in Yaba, Nigeria’s Silicon Valley. CcHUB boasts a rich network of 650 startups across Africa.

CcHUB partners with Amazon, and Google for Startups, Visa, and other international companies. The incubator focuses on projects in health, smart transportation infrastructure, fintech, education, and cybersecurity.

Another major center actively developing a technology and innovation startup environment is the MEST incubator in Ghana. Assistance from the Meltwater Foundation allows MEST to target startups from all over Africa at the earliest stages of development, train entrepreneurs for free, and help with product prototyping and hypothesis testing.

MEST is an educational program for IT entrepreneurs, an internal seed fund, and a network of incubators for technology startups in Africa. The hubs are located in Accra, Lagos, Cape Town, and Nairobi. The organization has been active since 2008, actively supporting programmers and engineers. One of the programs lasts a year, is designed for 60 start-ups, and is completely free. MEST has many famous partners, such as the acceleration program for fintech startups supported by the French bank Societe Generale.

In Ethiopia today, three private business incubators are systematically working with technology startups: BlueMoon, iceAddis, and iCog/Solve. The first has more AgriTech, the second has eCommerce startups, and the third has programming, including AI projects.

The iCog/Solve gas pedal hosts Ethiopia Hacks, a series of 12 hackathons in which 600 people have already participated. The project is funded by the U.S. Department of State and the U.S. Agency for International Development, with Google Developers Group (GDG) and the Center for Accelerated Women’s Economic Empowerment (CAWEE) as partners.

Here, with the support of Kenya’s Ministries of Health and Transport, the famous MSafari service was created to monitor the passenger flow of public transport.

The Cape Innovation and Technology Initiative (CiTi) is the oldest technology business incubator on the continent. Located in Cape Town and founded in 1999, it focuses on the development of IT projects. During its existence, it has helped three thousand entrepreneurs to create more than two thousand companies and continues to be actively involved in the Cape Town technology community.

iHub – each year the gas pedal supports 450 startups. The gas pedal has a wide range of programs for business startups. One of them is aimed at the development of IT projects run by women.

Startupbootcamp Afritech – runs several accelerator programs, including ASIP Accelerator Program and iNovo. Project recruitment happens all the time, and there is a virtual and offline passing format. The program is supported by Amazon, Nedbank, PwC, and other large companies. Participants have a chance to receive an investment of 15 thousand euros.

The most specialized technoparks are presented in South Africa – Technopark Stellenbosch, Highveld Techno Park, and The Innovation Hub. Notable technoparks exist in Senegal (Dakar Technopolis), Rwanda (Kigali ICT Park), Madagascar, and Zimbabwe at NUST University.

Africa, with a population of 1.35 billion, could overtake China and India in the next decade. McKinsey estimates that by 2025, the region will have 360 million smartphones and 240 million computers and laptops, and digitalization will increase GDP by $140-320 billion. Not surprisingly, such a large – and still technologically untapped – market is beginning to play an increasingly prominent role in the economic arena.

Thanks to the serious penetration of smartphones and the large percentage of the young population, the African market is becoming a convenient environment for launching and developing technological projects. A large number of fragmented states at different stages of economic development makes it difficult to create a unified startup industry in the region but does not prevent the effective functioning of individual technology hubs with which large international companies are willing to cooperate.

Localization of foreign projects in Africa is complicated by a large language group, corruption, and the specific mentality of the population, but the potential growth opportunities and lack of serious competition more than offset the possible risks.

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In healthcare, FDI continues to grow as pharmaceutical spending could double by 2040.

Companies like Kelix bio invest in vaccine manufacturing, while digital health startups and infrastructure initiatives—such as Altron HealthTech collaborations—mark rapid sectoral innovation .

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Africa is often hailed as the birthplace of some of the world’s most exciting tech startups. From Cape to Cairo, small businesses across the continent have become catalysts for change, helping to drive economic prosperity and leaving their mark on local society.

Having produced several industry shakers in the fintech space, it’s perhaps not surprising that the continent has become a very attractive option for startup investment. According to Boston Consulting Group, the rate of growth in the number of African startups receiving financial backing between 2015 and 2022 was nearly six times faster than the global average. And during the first nine months of 2023 alone, these tech ventures raised around $1.4 billion.

With SMEs already accounting for up to 90 percent of businesses in Sub-Saharan Africa, much focus is placed on supporting this vital sector of the economy to reach the levels of success we’ve come to associate with Africa’s tenacious startup culture.

The question is – how do we empower the small business down the road to rise to the ranks of a Flutterwave in Nigeria or M-KOPA in Kenya?

Much of the answer lies in providing these enterprises with the technology they need to drive operational efficiencies and scale their operations. Cloud technology has, for example, played an important part over the years in supporting Flutterwave’s core operations. Kenyan startup, M-KOPA, which provides digital financial services to underbanked consumers, also relies heavily on the computing capacity of the cloud. Its ability to process 500 payments per minute makes it possible for the startup to provide 3 million people across Africa with access to essential services such as solar power systems, digital loans, health insurance and smartphones.

Beyond fintech, small businesses are having a transformative impact on other key sectors such as healthcare. And as with Flutterwave and M-KOPA, many of these enterprises have something important in common – the backing of powerful technology.

In South Africa, Omnisient is helping to elevate crucial decision-making across healthcare systems through a recent partnership with Altron HealthTech. The startup has created a platform that facilitates data collaboration across records and datasets and can securely match anonymised patient information in a safe environment for analysis. This allows Altron’s healthcare partners more insight into disease patterns and can improve treatments and medication efficacy.

Another startup leaving its mark in the healthcare space, Zen Dawa, is helping to reimagine pharmaceutical operations across both rural and urban areas of East Africa by creating online access to pharmaceutical offerings as well as financing solutions for small businesses and pharmacy shops. By making use of Microsoft’s robust AI platform built on Azure, the startup is helping to contribute positively to the availability of essential medicines across East Africa.

However, there are still many challenges to be addressed when it comes to drawing a larger number of the continent’s SMEs into the digital economy. Africa is still behind other regions in the world when it comes to digital infrastructure coverage, access, and quality. We are also still battling a shortage of skills and inadequate regulatory policy environments. With just 22 percent of the population online, Sub-Saharan Africa is still the world’s least connected region.

Addressing these issues will rely in no small part on the development of strategic alliances across both public and private sectors. These collaborations are pivotal to the development of comprehensive solutions to the multi-faceted challenges faced by small businesses in Africa. The FGN-ALAT digital Skillnovation Programme is a great example of this. A partnership between the Federal Government of Nigeria, Wema Bank, Get Funded Africa and Microsoft, the programme aims to train and equip one million micro, small and medium enterprises (MSMEs) across the country by the end of June 2024. Already 350, 000 MSMEs have been impacted.

Beyond skills, these businesses require business mentorship and access to market and finance opportunities – through effective collaboration the initiative aims to address all these needs in a holistic manner, facilitating opportunities, for example, to receive debt financing, equity investment and grants.

The more Africa can produce successful collaborations such as these, the more we’ll start to see a greater number of small businesses emerge as powerful economic contributors. These strategic partnerships hold the key to unlocking immense potential across sectors, empowering entrepreneurial ventures to drive new digital solutions to long-standing challenges and creating a ripple effect that reverberates throughout the continent.

By Gerald Maithya – General Manager, Microsoft Africa Transformation Office

Which sectors are Chinese investments in Africa focusing on?

Which sectors received the most foreign investment?

Several African entities are active in FDI partnerships: Egypt’s Sovereign Fund works with renewables investors, Kenya’s Ministry of Trade partners with UAE logistics and tech firms, while the Tanzania Investment Centre simplifies investment for foreign partners.

Global multinationals remain highly active.