African Countries with Highest Foreign Direct Investment
Listed below are the African countries with the highest foreign direct investment (FDI) in 2023. FDI refers to the financial resources put into a country’s economic interests by another, usually in the form of purchasing assets, setting up shop, or owning shares in a foreign company.
According to the World Investment Report 2024 by the United Nations Conference on Trade and Development (UNCTAD), global FDI dropped by 2% to $1.3 trillion in 2023 amidst an economic slowdown and rising geopolitical tensions.
Several factors contributed to these disruptions, including crises, protectionist policies, and regional realignments, affecting economies worldwide. Despite these challenges, the distribution of investment varies significantly across countries, with some emerging as favored destinations due to specific advantages.
In Africa, Egypt attracted the highest FDI in 2023 with $9.841 billion, though this was a decrease from $11.4 billion in 2022. South Africa also saw a drop, with $5.2 billion in 2023 compared to $9.2 billion in 2022, while Nigeria received $1.873 billion. European investors are the largest holders of FDI stock in Africa, led by the United Kingdom at $60 billion, followed by France and the Netherlands with $54 billion each.
Below is a list of the top African countries with the highest foreign direct investment (FDI);
Top 10 African Countries with Highest Foreign Direct Investment in 2023
1. Egypt – $9.841 billion
2. South Africa – $5.2 billion
3. Ethiopia – $3.263 billion
4. Uganda – $2.886 billion
5. Senegal – $2.641 billion
6. Mozambique – $2.509 billion
7. Namibia – $2.345 billion
8. Nigeria – $1.873 billion
9. Côte d’Ivoire – $1.753 billion
10. Democratic Republic of the Congo – $1.635 billion
Frequently Asked Questions On the Top African Countries with Highest Foreign Direct Investment in 2023
1. What is Foreign Direct Investment (FDI)?
A: FDI is an investment made by a person or company in one country into a business or company in another country.
2. Why is FDI important for African countries?
A: FDI brings capital, technology, and job opportunities, contributing to economic growth and development.
3. Which African countries received the highest FDI in 2023?
The top recipients of FDI in Africa in 2023 include countries like Egypt, South Africa, and Morocco, among others.
4. What factors attract foreign investors to African countries?
A: Factors such as political stability, economic growth, natural resources, market size, and government policies influence FDI inflows.
5. What are the challenges faced by African countries in attracting FDI?
A: Challenges include infrastructure deficits, corruption, political instability, and competition from other regions.
6. How can African countries improve their FDI climate?
A: African countries can enhance their FDI climate by implementing investor-friendly policies, improving infrastructure, and reducing bureaucratic hurdles.
7. How does FDI impact job creation in Africa?
A: FDI can create jobs directly through investments in new businesses and indirectly through supporting local industries.
8. What is the role of FDI in technology transfer?
A: FDI facilitates technology transfer by bringing in advanced equipment, processes, and knowledge to host countries.
9. How does FDI contribute to economic diversification in Africa?
A: FDI can help diversify economies by promoting investments in sectors beyond traditional commodities, such as manufacturing and services.
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