Clean energy FDI boosts sustainability momentum in Africa: UNCTAD

PHOTO

Foreign direct investment (FDI) flows to Africa fell by 3% to $53 billion in 2023, according to the latest World Investment Report released by UN Trade and Development (UNCTAD) today. Two of the largest recipient economies – Egypt and South Africa – drove the overall trend.

During the year, the estimated value of international project finance deals in African nations declined by 50% to $64 billion. This follows a 20% drop in 2022.

However, the continent attracted a growing share of global greenfield megaprojects, six of them valued above $5 billion.

Topping the list was a green hydrogen project in Mauritania, a least developed country in Northwest Africa. This project is expected to generate $34 billion in investment, an amount several times greater than the nation’s GDP.

Africa also received more than $10 billion in project finance for wind and solar electricity production, with the largest projects located in Egypt, South Africa, and Zimbabwe.

Value chains for electric vehicles also prompted foreign investments. The largest deals announced included one to establish a $6.4-billion electric vehicle battery manufacturing facility in Morocco.

The main economies investing in the continent, by FDI stock, are the Kingdom of the Netherlands, France, the United States, the United Kingdom, and China.