10 African Countries With the Highest Investment Risk in 2025
For years, the phrase “Africa is too risky” has rolled off investors’ tongues like small talk at a cocktail party. It’s the excuse that justifies hesitation, the fine print that always seems to shadow opportunity.
The past decade has tested the continent’s resilience in every possible way. Oil prices crashed, aid shrank, COVID rewrote economies, and inflation gnawed at stability. In January, The Economist even called Africa’s investment climate “the worst in years.”
And yet, the numbers tell a more hopeful story. Foreign direct investment into Africa rose by 12% in 2024, while it fell in developed economies. By midyear, not a single African sovereign bond was trading in distressed territory, for the first time in more than ten years.
According to Oxford Economics Africa and Control Risks, who have tracked 24 countries over ten years through the Africa Risk-Reward Index, the continent has been in a constant dance between reform and uncertainty.
A handful of mid-sized reformers have quietly made the biggest progress. These are countries that may not dominate headlines but have recorded some of the strongest gains in the Index. Their success proves that reform pays off, especially for economies that used to be overlooked in favour of bigger players.
Nigeria’s reward score has barely moved. The country’s foreign exchange scarcity, oil theft, and sudden policy shifts have weighed heavily. Still, there’s optimism that President Bola Tinubu’s recent macroeconomic reforms, along with a modest oil sector recovery, could help turn the tide.
Ethiopia, once hailed as Africa’s most promising high-risk/high-reward market, tells a different story. What began with optimism under Prime Minister Abiy Ahmed’s liberalisation agenda has since been overshadowed by the Tigray conflict and surging ethnic violence. Both its risk and reward scores have declined, reflecting the loss of investor confidence.
Beyond individual countries, regional integration remains Africa’s long game. The African Continental Free Trade Area (AfCFTA) still holds the promise of a single, borderless market by 2030. But the journey is uneven; many nations still lag in infrastructure, trade facilitation, and regulatory alignment, all key to unlocking scale.
