Egypt continues to be Africa’s largest recipient of foreign direct investment (FDI) flows in 2019, marking a 10.7% hike, despite the slump in FDI inflows to the entire continent to USD 45 bn (EGP 727.2 bn), Invest-Gate reports.

“FDI inflows to North Africa decreased by 11% to USD 14 bn (EGP 226.2 bn), with reduced inflows in all countries except Egypt,” read the United Nations Conference on Trade and Development’s (UNCTAD) “Global Investment Trends Monitor 2019” report, noting that Egypt posted USD 9 bn (EGP 145.4 bn) in FDIs last year.

UNCTAD highlighted that economic reforms undertaken by the Egyptian government have improved macroeconomic stability and boosted investor confidence in the country. Although FDIs were still driven by the oil and gas industry, investment in the non-oil economy was also taking place.

According to the report, communications, consumer goods, and real estate sectors have seen significant investments in 2019.

“Egypt ranked first in Africa in re-investing the profits of foreign companies by 41%, where the reinvested profits for multinational companies represent a remarkable share of foreign direct investment inflows to the economies of the countries of the continent,” it confirmed, pointing out that lowering profit expectations will have a tangible impact on investment flows to Africa in 2020.

UNCTAD revealed that global FDI flows are forecast to drop by as much as 40% in 2020, from USD 1.54 trn (EGP 24.9 trn) in 2019, bringing FDIs below USD 1 trn (EGP 16.2 trn) for the first time since 2005.

In addition, FDIs are set to decline by a further to 10% in 2021; and to initiate a recovery in 2022, the report concluded.