Africa Drew $70 Billion in Foreign Investment. The Next Challenge Is Keeping More Value at Home

Africa attracted about $70 billion in foreign direct investment in 2025, keeping investment flows well above the continent’s long-term average even after they fell from the exceptional level recorded a year earlier.

According to the World Investment Report 2026 analysis published by UN Trade and Development, the 2025 total was Africa’s third-highest level of FDI since 1990 and roughly one-third above its 2010-2024 average.

The figures show that investor interest in Africa remains substantial. They also expose a more difficult development question: how much of the value generated by new investment will remain within African economies through local processing, employment, supplier development, technology transfer and deeper industrial value chains?

Strategic sectors attract capital

UNCTAD identifies strategic industries as an increasingly important part of global investment. Energy-transition infrastructure, critical minerals and digital infrastructure are among the areas attracting capital as governments and companies reorganise supply chains around energy security, technology and decarbonisation.

Africa occupies an important position in that shift. The continent holds significant reserves of minerals required for batteries, renewable-energy systems and other technologies, while its infrastructure deficit creates considerable demand for power, transport, logistics and digital investment.

But attracting capital into resource extraction or large infrastructure projects is not automatically the same as achieving broad-based industrialisation. The development impact depends in part on whether investment creates linkages with domestic firms, builds local capabilities and supports more sophisticated economic activity.

From extraction to value chains

This distinction is especially important in critical minerals. African governments increasingly want to move beyond exporting unprocessed raw materials and capture more value through refining, processing and manufacturing.

Doing so requires more than mineral deposits. Competitive industrial value chains depend on reliable electricity, transport corridors, access to finance, skills, predictable regulation and markets large enough to support investment at scale.

Regional integration can therefore become part of the investment equation. The African Continental Free Trade Area offers a framework for larger markets and cross-border value chains, although the practical benefits depend on implementation, infrastructure and the removal of non-tariff barriers.

A global investment shift

UNCTAD’s wider 2026 investment assessment shows that global FDI rose 6% to about $1.6 trillion in 2025, but development gains remained uneven. The organisation has cautioned that headline investment totals can mask weaknesses in productive investment and disparities between countries and sectors.

For Africa, the approximately $70 billion recorded in 2025 remains significant despite the decline from 2024. The more important measure over time will be whether those flows help expand productive capacity and diversify economies.

That means assessing investment not only by the amount of capital entering a country, but by what follows: how many local businesses enter supply chains, whether processing takes place domestically, whether workers acquire transferable skills and whether infrastructure built for major projects also supports wider economic activity.

Africa’s investment proposition is increasingly tied to sectors that the global economy considers strategic. Turning that position into durable industrial development will require governments and investors to connect individual projects to broader national and regional economic ecosystems.

Sources

• UN Trade and Development: Africa is attracting investment in strategic industries
• UN Trade and Development: Global investment rises 6% to $1.6 trillion
• UNCTAD: Africa launch of the World Investment Report 2026