Akorbi Explains the Top 5 Countries Investing in African Markets (2024)

FAQs

What countries invest in Africa the most? ›

China. China is the world's largest investor in Africa in terms of total capital. They invested more than $72 billion in the continent from 2014 to 2018, according to the Brookings Institute. That investment created more than 137,000 jobs across 259 projects.

The continent has extensive natural resources, a young and increasingly educated workforce, more stability in terms of governance, and more prospects for economic growth than in years past. For new investors looking to make a small investment, mutual funds or exchange-traded funds make the most sense.

Mauritius (25%), Singapore (23%), USA (9%), Netherland (7%) and Japan (6%) emerge as top 5 countries for FDI equity inflows into India FY 2023-24. Top 5 sectors receiving highest FDI Equity Inflow during FY 2023-24 are Services Sector (Finance, Banking, Insurance, Non Fin/ Business, Outsourcing, R&D, Courier, Tech.

The reason why more foreign investments are not attracted to West Africa is due to instability in political and industrial policies. Foreign investors are typically looking for stable economic and political environments in which to invest their capital.

GDP of African countries 2024, by country

South Africa's GDP amounted to just over 373 billion U.S. dollars in 2024, the highest in Africa. Egypt followed, with a GDP worth around 347.6 billion U.S. dollars and ranked as the second-highest on the continent. Algeria ranked third, with about 266.8 billion U.S. dollars.

While the EU is Africa's biggest trading partner, followed by China and then intra-African trade, the researchers also examined Africa's trade with the US, UK and emerging economies such as India, Brazil and Turkey.

Investing in Africa is good business and a sustainable corporate strategy for foreign investors. Advanced and emerging countries' governments and the private sector should leverage these profitable, emerging investment opportunities.

Africa is a continent that holds immense opportunity for private investors. It has a young and growing population and abundant natural resources. Cities are seeing massive growth. Many countries have launched long-term industrialization and digitalization initiatives.

The continent has 40 percent of the world's gold and up to 90 percent of its chromium and platinum. The largest reserves of cobalt, diamonds, platinum and uranium in the world are in Africa. It holds 65 per cent of the world's arable land and ten percent of the planet's internal renewable fresh water source.

The U.S. stock market is considered to offer the highest investment returns over time. Higher returns, however, come with higher risk. Stock prices typically are more volatile than bond prices. Stock prices over shorter time periods are more volatile than stock prices over longer time periods.

Who is the biggest investor in the US? ›

Countries with largest stock markets globally 2023

In 2024, stock markets in the United States accounted for roughly 60 percent of world stocks. The next largest country by stock market share was Japan, followed by the United Kingdom.

FDI allows the transfer of technology—particularly in the form of new varieties of capital inputs—that cannot be achieved through financial investments or trade in goods and services. FDI can also promote competition in the domestic input market.

The continent has been viewed as a place of rampant political corruption, crumbling infrastructure and bloody civil conflicts. Many investors see Africa as a place where promising companies will have limited growth potential and little access to the capital they need.

Political Instability and Energy Crisis

The continent has the disadvantage of a concentration of wealth across a small number of countries. Investors may be concerned by the potential insolvency risk of countries with high public debt in the region.

IMF. With a GDP per capita of $21,580 in 2023, the Seychelles is Africa's most prosperous nation, based on this indicator.

It is Nigeria, a country in West Africa, which stands out as the most powerful economy on the continent. With a GDP estimated at $477 billion in 2022, Nigeria is at the top of the ranking of the richest African countries, ahead of Egypt and South Africa.

European investors remained by far the largest holders of foreign assets in Africa, led by the United Kingdom ($65 billion) and France ($60 billion). Africa: FDI inflows and share in world inflows, 2011–2021 (Billions of dollars and per cent) Figure 1.

Ranked: Africa's Economies by GDP

At first place, South Africa is Africa's biggest economy in nominal terms, with an estimated GDP of nearly $400 billion. The country's mining industry is a major contributor to the economy, accounting for nearly 60% of total exports in the first half of 2023.