Africa is undergoing a “Silent but irreversible” industrial transition, even as progress remains uneven and concentrated. This is according to two reports launched today on the sidelines of the African Development Bank Group’s 2026 Annual Meetings in Brazzaville city, Congo.
The Bank Group launched the 2025 edition of its Africa Industrialization Index (AII) alongside the inaugural Africa Industrial Investment Barometer (AfIIB) report, developed by WITBA Invest SA in partnership with Trendo.
Together, the two reports offer the most granular picture to date of which countries are industrializing most rapidly, where investment is flowing, and how much of the value generated remains on the continent.
Both reports share a single diagnosis: Africa’s industrial integration is low. Intra-African trade stands at just 14.4 percent of total trade, reflecting weak regional production linkages and fragmented industrial ecosystems.
The AII 2025, which assesses industrial development across 54 African countries from 2010 to 2024, finds that 41 countries improved their industrialization scores, with continental performance up six percent.
The strongest gains were recorded among lower-performing economies, a sign of convergence.
Still, significant gaps remain: Africa accounts for less than two percent of global manufacturing output and just 1.4 percent of manufacturing exports; and manufacturing value-added per capita has fallen below pre-2014 levels.
Welcoming the release of the report, Ousmane Fall, African Development Bank Group Director for Industrial and Trade Development, said, “This report is a roadmap as much as a diagnosis. It shows that 41 of our 54 countries are now moving in the right direction, but it also reminds us that industrialization at scale demands resilient infrastructure, value addition close to source, and finance mobilized on African terms. That is precisely what the Four Cardinal Points are designed to deliver.”
In the report’s most striking finding, Morocco has overtaken South Africa as the continent’s leading industrial economy, driven by sustained industrial upgrading, export diversification, and strong industrial policy.
South Africa remains a continental powerhouse, but its competitiveness has declined steadily. North and Southern Africa dominate output and export sophistication, while East, West, and Central Africa lag.
The AII calls for integration to move beyond shallow tariff reductions towards functional economic corridors, quality infrastructure, and harmonized standards–all anchored in the African Continental Free Trade Area (AfCFTA).
The AfIIB examines African industrialization through three indices — industrial diversification, attractiveness, and productive anchoring, which measures how deeply investment is embedded locally.
North Africa leads on all three, drawing 56 percent of cumulative continental investment between 2020 and 2025, with Morocco and Egypt at the forefront.
“The continent’s real deficit is no longer the absence of industrial strategies. What is still lacking is execution discipline, continuity in public policy, and systemic coherence between financing, energy, infrastructure, human capital, governance, and industrial vision,” said Dr Harouna Kaboré, President of WITBA Invest.
“African industrialization can no longer remain a statement of intent or a theoretical projection. It must become a measurable, managed, and strategically driven dynamic,” he added.
Attracting investment does not guarantee that value stays local, the Barometer warns.
East Africa posts the continent’s second-highest productive-anchoring score owing to deep regional integration and complete agricultural value chains. By contrast, Southern Africa draws the highest share of high-value investment yet features weak vertical integration.
For example, the region’s automotive plants assemble largely imported kits rather than sourcing from local supplier networks.
West and Central Africa remain locked in first-stage processing: Ivorian cocoa exported as powder rather than finished chocolate, Guinean bauxite shipped raw, Sahelian gold and uranium exported without downstream industry.
Both reports stress access to reliable and competitive energy, cross-border industrial infrastructure, long-term local currency finance, investment in technical skills, and harmonization of standards as critical enablers.
The AfIIB also urges African industries to decarbonize now to avoid being structurally disadvantaged by carbon border measures imposed in the coming decade by Europe and the United States.
For private investors, Africa offers above-average returns in construction materials, agro-processing, fertilizers, and generic pharmaceuticals but long-term success will require structural partnerships and commitment of patient capital, the Barometer argues.
The other panelists were: Ismaël Nabé, Minister of Planning, International Cooperation and Development of the Republic of Guinea; Ms. Mutesi Rusagara, Minister of State for Public Investments and Resource Mobilization, Rwanda; Michel Djombo, Minister of Industrial Development, Special Economic Zones and Private Sector Promotion of the Republic of Congo; and Victor Djemba, Head of the Africa Bureau of the United Nations Industrial Development Organization, who delivered the closing remarks.
The Bank Group’s 2026 Annual Meetings, comprising the 61st Annual Meeting of the Board of Governors of the African Development Bank and the 52nd Annual Meeting of the Board of Governors of the African Development Fund, run in Brazzaville from 25 to 29 May 2026.
Article attributed to African Development Bank (afdb) website
