Africa's FDI Share Stagnates at 4-6%, PAMA Warns

The Pan African Manufacturers Association (PAMA) has reported that Africa's share of global foreign direct investment (FDI) remains trapped in a narrow corridor of 4-6%, despite a significant 14% increase in global FDI to $1.6 trillion in 2025. African inflows plummeted by 38% to just $59 billion, highlighting a stagnation in the continent's manufacturing sector.

PAMA attributes this to a shallow industrial base focused on low-value-added services rather than high-product manufacturing, which is essential for long-term transformation. The report emphasizes that North African nations like Egypt and Morocco have successfully leveraged trade links with Europe, while Southern Africa, particularly South Africa, faces significant challenges, including a record negative inflow of $6 billion due to capital withdrawal.

PAMA calls for an urgent pivot in FDI strategies, advocating for policy certainty, regulatory discipline, and macroeconomic stability to enhance investor confidence. The report also identifies structural deficits in energy and technical skills as major growth impediments and suggests that the African Continental Free Trade Area could be pivotal in creating integrated markets.