Africa is showing signs of cautious optimism, with inflation falling across many countries. Disinflation is evident in economies like Ghana (21%), Kenya (~4%), South Africa (under 3%), and Egypt (from over 30% to low teens). This has allowed central banks to begin easing monetary policy, creating more growth-friendly conditions in 2025 compared to previous years.
Economic growth is slowly recovering, with the IMF projecting Sub-Saharan Africa to grow by 3.8% in 2025, slightly up from 3.4% in 2023, but still below historical trends. Countries with reforms and commodity tailwinds (like Ghana and Morocco) are seeing stronger rebounds, while high-debt nations like Nigeria and South Africa continue to struggle. Fiscal consolidation and debt management have become a central theme across the continent, with governments implementing politically difficult but necessary reforms to restore credibility and reduce borrowing costs.
Investment sentiment is improving. Venture capital saw a notable rebound in April, and foreign direct investment is flowing into sectors like tech and manufacturing. The major startup hubs—Nigeria, Kenya, Egypt, and South Africa—alongside emerging players like Ghana and Morocco, are attracting most of the capital. This momentum, if sustained, could mark a shift toward private investment becoming a central growth driver, reducing reliance on public debt.
Africa is entering a potential new phase of growth, rooted in reform, investment, and diversification. If current trends hold and governments manage key risks wisely, the continent could turn the hard lessons of the early 2020s into a more stable and inclusive foundation for development.
In April 2025, African startups raised $343 million across 39 deals, making it the second-best April on record and a sharp rebound from March.
That’s 4.5x more than April 2024, driven by big-ticket deals like hearX ($100M, South Africa), Bokra ($59M, Egypt), and Stitch ($55M, South Africa).
M&A activity also picked up with fintech exits in Egypt, Nigeria, and South Africa.
Year-to-date (Jan–Apr), startups have raised $803M across 163 ventures, a 43% increase from the same period in 2024.
Over 225 unique investors have participated so far, and several Africa-focused VC funds have raised over $1.3B since early 2024.
Overall, the ecosystem shows signs of real recovery, with broader participation, deeper investor pools, and strong early momentum for 2025. It’s still early, but the outlook is optimistic.
