The investment case for Africa has never been stronger, but it still requires a long-term horizon and a steady hand. 

Lagos, Kampala, Cairo and Cape Town may be worlds apart in terms of culture, economic makeup, investment and innovation drivers, but the world still sees them and the 54 countries of Africa as a homogenous mass. This makes the African investment opportunity – and the risks that go along with achieving those rewards – both a collective advantage and, at times, a challenge. 

Historically, issues of political volatility have weighed heavily on pan-African investment, alongside governance and regulatory uncertainty in some markets, infrastructure deficits, and issues of corruption. However, it would be narrow-minded to ignore Africa’s range of dynamic growth sectors from telecoms and renewables to oil and financial services, or its growing population and strong emerging middle class.  

While much of the world is struggling with ageing workforces, Africa remains a young and vibrant continent of 1.5 billion people. Currently, it is not only home to some 18% of the world’s population¹ but around 70% of individuals in sub-Saharan Africa are younger than 30². By 2030, 50% of new entrants into the global workforce will come from sub-Saharan Africa³. 

This emerging consumer market and labour dividend is not the only strong factor. Debt-to-GDP ratios in Africa are lower than those in developed nations, reflecting both the capacity to repay debt in most countries and relative fiscal stability. The high yield of Africa’s debt has meant holders have enjoyed exceptional returns in recent years, even outperforming the S&P 500 over certain periods. 

On a nuanced country level, we see the stark contrast between South Africa – an economy that continues to grow at around a paltry 1% each year – and other African markets we invest in, which are typically growing more robustly at 4%, 6%, or even higher.   

GDP Growth  

Certainly, many of these countries are growing off a relatively low base, but this growth is also being fuelled by their strongly expanding populations, which is typically a good tailwind for economic growth. At the same time, this growth is supporting infrastructure development that is being funded either by internal funds or external organisations. A country like Egypt, for instance, looks significantly different today than it did a decade ago, as highways and railway systems are being constructed, communities are gaining access to electricity, and high-rise buildings are springing up.  

Global investors – particularly those in the Middle East – are becoming increasingly excited about Africa as a result of these factors. This follows a period where China was a dominant investor in Africa. With global markets being so highly concentrated in the United States currently, amid the dominance of just seven tech stocks, investors are looking at their portfolios and searching for the diversification and long-term potential that Africa offers.  

Similarly, for South Africans looking beyond their home market – but still seeking African exposure – there are rich pickings available across the rest of the continent.  

Cherry Picking the Best Opportunities 

From both a fixed income and an equities perspective, Egypt is an exciting market both now and in the long term. With a population of around 118 million, Egypt is Africa’s third-largest population behind Nigeria (over 237 million) and Ethiopia (135 million). A decade since the Arab Spring unlocked waves of mass political and social unrest, and having recently gone through challenges with debt levels and inflation, Egypt set about rebasing and resetting its economy in 2024. The currency weakened significantly as a result, but a great deal of support was forthcoming from the Gulf Cooperation Council, resulting in sizable financial inflows. Today, Egypt enjoys a stable outlook, despite the ongoing conflict on its eastern border.  

Another top contender on the continent is Uganda, which is a high-GDP-growth country. Uganda is expected to grow at 6.2% in 2025, with agriculture and services leading the way⁴. However, the big story is oil. With the construction of an oil pipeline to the coast about 70-80% complete, when oil production comes on stream, it is expected to boost growth to 10.4% in 2027⁵.  

While African equity is showing a lot of potential across the board, Uganda does not, as yet, have a deep equity market. However, companies such as MTN Uganda are powering ahead as one of the big fintech, mobile money stories on the African continent – yet another example of astute African companies spotting the shifts and using technology to leapfrog and disrupt established sectors.  

On the fixed income side, Uganda offers investors an expected yield of around 15% in local currency terms. This highlights the attractiveness of an income class that, across Africa, is currently compounding at 8-9% per annum in US dollars, and offering exceptional equity-like returns over a 10-15-year time horizon. Widescale pension reform across the continent has a lot to do with this positive story.  

In recent years, large swaths of the local pension fund industry have begun deploying their assets into fixed income because of the liquidity. The focus has been heavy on government-issued debt, as well as the development of corporate debt markets. Countries like Nigeria now have quite active corporate markets, and Ghana is also doing well in developing its market. In line with this strengthening of domestic bond markets, there has been the development of Eurobond markets – a helpful addition to the funding mix for African governments.  

Of course, it is not only governments that are benefitting. The appeal of fixed income is that it also offers global investors exposure to African countries where equity is a challenge, such as Uganda, as previously discussed, and Angola. While the record-breaking initial public offering was a boost for the Luanda exchange and Angola’s ongoing privatisation programme, its equity market remains nascent. Yet, there are still Angolan Eurobonds to be purchased as part of a strategically diversified portfolio.  

Even countries that have, in recent years, been faced with comprehensive debt-restructuring programmes, like Ghana and Zambia, are resetting successfully and simultaneously unlocking opportunities for their own growth and development, as well as long-term investment possibilities.  

Looking Beyond Short-Term Volatility 

As Africa’s fixed income and equity markets enter this period of renewed opportunity, the region continues to offer a structural growth story that remains unmatched in much of the developing world. For investors willing to look beyond short-term volatility, the region presents not just diversification potential, but access to long-term, sustainable growth — a chance to participate in the continent’s next phase of economic and financial maturation. 

 Footnotes 

¹ Macrotrends. (2025). Africa population (1950-2025). https://www.macrotrends.net/global-metrics/countries/afr/africa/population.

² United Nations. (n.d.) Young people’s potential, the key to Africa’s sustainable development. https://www.un.org/ohrlls/news/young-people%E2%80%99s-potential-key-africa%E2%80%99s-sustainable-development.

³ Laws, A., Saliba, F., Sever, C. & Tucker, L. (2024, 12 November). The clock is ticking on Sub-Saharan Africa’s urgent job creation challenge. IMF Blog. https://www.imf.org/en/Blogs/Articles/2024/11/12/the-clock-is-ticking-on-sub-saharan-africas-urgent-job-creation-challenge.

⁴ World Bank Group. (2025). The World Bank in Uganda. https://www.worldbank.org/en/country/uganda/overview.

⁵World Bank Group. (2025).