Africa Capital Markets Report 2025

African companies account for only 1% of the total value of equity raised globally since 2000. Capital market activity is highly concentrated, with South Africa, Morocco and Egypt accounting for 80% of total market capitalisation, and trading activity is generally low. Weaknesses in the corporate governance of listed companies and of state-owned enterprises limit their contribution to capital markets. Digital financial services have expanded financial inclusion but more investment in digital technology would increase their impact on capital market activity.

Africa accounts for only 1% of global sovereign bonds, lower than its 3% share of global GDP. Combined with large refinancing needs, this is straining the fiscal capacity of many countries. Corporate debt is also low and accounts for just 5% of total EM corporate debt, with activity highly concentrated in a few countries. Both sovereigns and corporates are exposed to significant foreign currency risk as a large part of their debt is denominated in foreign currencies. 80% of rated African countries are classified as high or very high risk.

Insurance companies and pension funds play a limited role as institutional investors in most African countries. Insurance penetration, at 3.5% of GDP, is half the global average, and pension fund assets are also smaller, equivalent to 23% of GDP compared to 34%. The limited size of their assets and considerable allocation to government assets prevent them from contributing as stable providers of capital to the real economy. For pension funds, low incomes and high levels of informal employment present additional constraints.

Assuming recent trends in public and private climate investment in Africa, shortfalls in climate investment are expected until 2040. While investments grew by 15% annually during the last 3 years, clean energy investment must rise to 2.4 times current levels in North Africa and 1.8 times in Sub-Saharan Africa to meet the required 2026 targets. This highlights the importance of the involvement of both public and private sectors to achieve climate goals.