Morocco became Africa’s most industrialised economy in 2025, overtaking South Africa, according to the latest Africa Industrialisation Index released by the African Development Bank (AfDB). The report attributes Morocco’s rise to ongoing efforts to modernise its industrial base, diversify exports and implement policies aimed at accelerating economic growth.
The AfDB noted that although South Africa remains one of the continent’s leading industrial hubs, it has experienced a gradual decline in industrial competitiveness over recent years.
South Africa’s industrial performance has been affected by persistent electricity shortages, governance challenges, political uncertainty and rising living costs, factors that have discouraged investment and constrained economic expansion. Over the past decade, the country’s economy has grown at an average rate of less than 1% per year.
President Cyril Ramaphosa has previously stated that South Africa requires approximately 1.6 trillion rand (about 99 billion dollars) in public infrastructure investment, in addition to 3.2 trillion rand from the private sector, to meet its infrastructure development targets by 2030.
According to the report, gross fixed capital formation declined in three of the four quarters of last year, although investment recovered during the final months of 2025, indicating renewed spending by businesses on machinery, equipment and buildings.
The AfDB also highlighted that industrial activity in Africa remains largely concentrated in North and Southern Africa, regions that account for the bulk of the continent’s manufacturing output, export sophistication and industrial competitiveness.
Source: Bloomberg
