This archive report was first published on 8 July 2020.
Published on July 8, 2020, the World Investment Report 2020 by Unctad reveals a sharp decline in foreign direct investments (FDIs) in East Africa in 2019.
FDIs in the region dropped by 9% to $7.8 billion in 2019, from $9 billion in 2018. The decline was attributed to the ongoing COVID-19 pandemic, which has ravaged economies across the globe.
However, not all countries in the region experienced a decline in FDIs. Uganda saw a 20% increase in inflows to $1.3 billion, driven by the development of oil fields and an international pipeline, as well as projects in construction, manufacturing, and agriculture.
Kenya, on the other hand, experienced a decline of 18% in FDIs to $1.3 billion, despite new projects in information technology and healthcare. Tanzania's inflows remained largely unchanged at $1.1 billion, while Ethiopia, the biggest FDI recipient in the region, recorded a decline in 2019 after attracting inflows worth $2.5 billion, from $3.3 billion in 2018.
According to the report, the decline in FDIs is expected to continue in 2020, with a forecasted fall of 25 to 40% in FDI inflows to the continent. Several services industries, including aviation, hospitality, tourism, and leisure, are expected to be hit hard by the decline.
