KAMPALA, April 23, 2026 — Africa’s domestic capital base has surpassed external financing flows over the past decade, marking a decisive shift in how the continent funds its growth and industrialisation, according to the Africa Finance Corporation’s State of Africa’s Infrastructure Report 2026 [SAIR 2026].
The report shows that cumulative external flows to Africa totalled about US$1.7 trillion between 2014 and 2024, while non-bank domestic capital pools now exceed US$ 2trn. This milestone signals that African capital is increasingly well positioned to play a leading role in financing the continent’s development.
Launched today at the Africa We Build Summit in Nairobi — co-hosted by the Africa Finance Corporation and Kenya’s President, William Samoei Ruto — the report argues that the continent’s primary development challenge has shifted from mobilising capital to effectively intermediating it, that is, channelling savings into infrastructure, industry and productive investment at scale.
“The constraint is no longer capital — it is intermediation,” said Samaila Zubairu, President and Chief Executive Officer of the Africa Finance Corporation. “We have the savings, but not yet the systems to channel them into infrastructure and industry at scale. Closing that gap is now Africa’s most pressing economic task. The next phase of Africa’s infrastructure story must move beyond standalone assets towards integrated systems.”
Domestic capital on the rise
The growth in domestic institutional capital has been driven largely by pension and insurance assets, which have surpassed US$ 1trn for the first time. Public development bank assets stand at US$ 276 billion, while sovereign wealth funds account for US$ 164bln. Meanwhile, central bank reserves rose from US$ 480bln in 2024 to US$ 530bln in 2025.
This expansion has been partly supported by stronger commodity markets and increased gold accumulation. Gold now accounts for around 17 per cent of Africa’s total reserves, up from less than 10 per cent in 2022–2023, with physical holdings rising from 663 tonnes in 2022 to an estimated 738 tonnes in 2025.
Despite this growth, much of the domestic capital remains concentrated in short-term, low-risk instruments — particularly government securities — reflecting limited investable project pipelines, regulatory frameworks that favour liquidity, and inadequate risk-sharing mechanisms. This has created a persistent gap between available savings and long-term productive investment.
External financing declines
At the same time, external financing is becoming less reliable, strengthening the case for a domestically driven development model.
Official development assistance to Africa fell from US$ 83.8bln in 2020 to US$ 73.5bln in 2023 and is expected to decline further. The OECD estimates that global official development assistance dropped by 23.1 per cent in 2025 — the sharpest annual contraction on record.
Sovereign bond issuance has also declined sharply, from over US$ 29bln in 2018 to between US$ 4bln and US$ 6bln annually in 2022–2023. Foreign direct investment has remained broadly flat at about US$ 45–55bln per year, well below the levels required to meet Africa’s development needs.
As a result, external capital is increasingly playing a complementary — rather than central — role in the continent’s development financing.
Shift towards integrated systems
The report identifies the greatest opportunity for capital deployment in demand-driven, integrated infrastructure systems.
In transport and logistics, corridors generate the most value when developed as production ecosystems rather than simple transit routes — linking ports, railways, roads, storage facilities and trade systems to industrial demand. While a continental backbone is emerging, the report emphasises the need to improve execution, coordination and performance.
In East Africa, this trend is already evident. The Port of Mombasa — one of the continent’s busiest — handles more than 45 million tonnes of cargo annually, while railway investments continue to extend inland connectivity, including along the Naivasha–Kisumu corridor.
In aviation, identified as the most immediate and scalable integration lever, the sector contributes a combined US$ 5.5bln to GDP across Kenya, Rwanda and Ethiopia, supporting around one million jobs.
In the energy sector, the focus is shifting from incremental capacity additions to integrated systems that combine generation, transmission, storage, fuel supply and industrial demand. Cross-border projects, such as the Ethiopia–Kenya interconnector, illustrate how regional infrastructure can enhance efficiency and reliability.
Closing the resilience gap
Recent global shocks — from the Russia–Ukraine conflict to the 2026 Gulf crisis — have exposed the vulnerabilities of fragmented systems and highlighted the urgency of building domestic processing capacity, storage and resilient supply chains.
Africa continues to import more than 70 per cent of its refined fuel and faces an estimated US$ 230bln annual import bill for essential goods, including fuel, food, plastics, steel and fertiliser.
In digital infrastructure, although connectivity has expanded rapidly, the report points to the need to develop the “missing middle” — including terrestrial backbone networks, metro fibre systems, data centres, internet exchange points and enterprise platforms — to translate connectivity into productivity, services exports and job creation.
Across sectors, the report concludes that Africa’s development challenge is increasingly institutional rather than financial. While capital is available and infrastructure assets are expanding, the next phase of growth will depend on integrating finance, energy, transport, industry and digital systems into cohesive ecosystems.
“Africa is not capital-poor — it is capital-rich but system-poor,” Zubairu said. “The priority must be to build the institutions, instruments and project pipelines required to deploy that capital into infrastructure and industry at scale.”
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