The East African Community (EAC), a regional bloc comprising seven nations, includes some of Africa’s most densely populated and resource-rich countries. With a combined GDP of $305.3 billion in 2021, expected to reach $346.17 billion in 2023, it offers an appealing investment destination. The EAC, with a population exceeding 300 million, is strategically positioned for investment. Abundant resources such as proven oil deposits in Uganda, liquefied natural gas in Tanzania, and valuable minerals like copper, cobalt, and nickel in the Democratic Republic of Congo (DRC) and Tanzania attract investor interest.
The region boasts a wealth of minerals, including diamonds, coal, gold, iron ore, oil, titanium, and zirconium, making it optimistic about robust economic growth prospects, further enhancing its appeal to investors. Despite global challenges exacerbated by events like the Ukraine war and rising inflation, the East African region witnessed an increase in investment flows in 2022. According to the World Investment Report 2023, foreign direct investment (FDI) inflows in the region increased by 9%, totalling $3.8 billion.
The Democratic Republic of Congo (DRC) remains a significant FDI destination in the region, driven by investments in the mining sector, particularly cobalt and copper. It is supported by countries like South Africa, Belgium, and China.
Uganda experienced a 39% growth in FDI inflows to $1.5 billion in 2022, making it the second most attractive investment destination in the region. Tanzania also saw an 8% increase in FDI, reaching $1.1 billion. However, Burundi has the lowest FDI inflows in the EAC region, attracting $12.88 million in 2022.
The investment trend in these countries indicates the potential for economic growth and development in the East African Community. As the region continues to open up to investment, structural reforms, and integration into the EAC, FDI inflows are expected to rise further.