The Pan African Manufacturers Association (PAMA) is looking forward to the top ten countries on the continent that are poised to attract significant foreign direct investment inflow in 2025.
PAMA has identified these promising nations by analyzing their GDP, inflation, exchange rate, and interest rate trends over the past two years.
Engr Mansur Ahmed, the President of PAMA, foresees that Ethiopia, Ghana, Morocco, Kenya, and Nigeria will emerge as key destinations for investment inflows, based on their favorable macroeconomic indicators.
Additionally, Egypt, Gabon, South Africa, Cameroon, and Angola are expected to be in the spotlight as well. In his outlook for Africa’s manufacturing sector in 2025,
Engr Ahmed anticipates notable improvements in performance and strategic opportunities, supported by increasing investments in local production, enhanced regional market integration through initiatives like the AfCFTA, and a broader adoption of human-machine collaboration.
While Africa is expected to remain relatively insulated from the protectionism wave in U.S. international trade policy, the ongoing US-China trade tensions could significantly boost foreign investment inflows into Africa, particularly in the automotive, textiles, and electronics sectors.
However, he acknowledges that key risks remain, with some challenges from 2024 likely persisting alongside new hurdles, such as stricter sustainability regulations and rising costs driven by factors like freight rate spikes.
These elements may require bold innovation, strategic adaptation, and collaborative efforts to navigate successfully. He envisions the manufacturing sector growing moderately in 2025, propelled by stronger regional integration, technological advancements, greater investor confidence, rising interest in local production, and an intensified commitment to zero-defect manufacturing aimed at reducing waste and enhancing efficiency.
While Africa is expected to remain relatively insulated from the protectionism wave in U.S. international trade policy, the ongoing US-China trade tensions could significantly boost foreign investment inflows into Africa, particularly in the automotive, textiles, and electronics sectors.
PAMA anticipates that cross-border value chains in Africa will expand, especially in agro-processing, textiles, metallics, and automotive industries.
Countries like Egypt, Rwanda, Nigeria, and Angola are likely to experience positive growth trajectories, driven by revamped investment policies and improved regulatory reforms. Conversely, slower manufacturing growth may be anticipated in regions grappling with severe conflict, such as the DRC.
Overall, FDI inflows into Africa’s manufacturing sector are projected to grow modestly by around 4% in 2025, as global investors are expected to seek opportunities amid improving economic conditions and the potential spillover effects of the shift in trade dynamics toward Africa.
Nonetheless, the geopolitical landscape and ongoing conflicts may still present challenges that could deter potential investors from entering key sectors of interest.