- Digital development is attracting new Foreign Direct Investment (FDI) to Africa.
- This as overall FDI into Africa is on the decline according to data from UNCTAD.
- African governments bet on digital infrastructure to attract FDI.
Africa’s digital frontier is attracting new foreign investment even though overall Foreign Direct Investment (FDI) has taken a dip. Digital start ups, especially mobile money ventures are the leading private sector investment while governments shoulder larger ventures like deployment of space technologies.
Notably, while Foreign Direct Investment has declined, but not so in digital infrastructure and fintech startups segments, the UN Trade and Development (UNCTAD) notes in its March update.
In it’s report titled ‘FDI in Africa declines significantly’ UNCTAD says, “after a brief surge of FDI in 2024 which was driven by massive single-country megaprojects, and greenfield investments, investment volumes have trended downward.”
For Africa, however, there is ongoing growth in the digital frontier, both through private sector investment in the fintech sector and African governments pushing for investment in digital infrastructure.
Let us first look at investment development in the fintech sector; offering smartphone and web-based payment options that are tailored to everyday uses such as making deposits, withdrawals, sub-regional remittances, utilities payments, tax and duty payments, and even visa application fees, all these make fintech and mobile money start-ups attractive to investors.
Global capital into Africa’s digital promise
Most recent examples include Proparco’s $250,000 financing to Rwanda’s health sector digital App EdenCare. “The funding will accelerate technology deployment, strengthen health insurance access and support digital coverage solutions for underserved businesses and communities,” said Fabrice Perez, Head of Financial Institutions and Innovation at the French development finance institution Promotion and Participation Company for Economic Cooperation (Proparco).
The mobile App provides insurance services, offering digital health coverage solutions to small and medium-sized enterprises, on one hand and on the other developing B2B platform for insurance providers.
EdenCare is now connected to 70% of Rwanda’s healthcare facilities which equals to more than 1,300 hospitals and clinics, as well as more than 600 healthcare facilities in Kenya. “By supporting EdenCare, we are contributing to a concrete shift in access to healthcare for underserved workers and businesses in East Africa,” he said.
Notably, less than 16% of Rwanda’s population has private health coverage. EdenCare’s model is evidence that inclusive insurtech is both impactful and commercially viable. “This is exactly the type of innovation that Proparco seeks to support across the African continent,” Perez said.
Then you have, Kenya’s fintech WapiPay which has now entered the North American market after it recently secured a FINTRAC licence in Canada. Thanks to the approval, now consumers can carry out money transfers, foreign exchange, payments and digital asset services. The service serves to strengthen cross-border trade and remittances between the US and Kenya.
Similarly, Kenya and Germany are exploring deeper cooperation in digital transformation, innovation and investment following the high-level executive talks held recently in Berlin during the Kenya–German Government Negotiation Business Day at the end of June 2026.
The event was held at the German Federal Ministry for Economic Affairs and Energy offices where discussions focused on strengthening economic ties, attracting private capital and advancing sustainable development through technology-led growth initiatives.
Now let us look at larger national and regional government led initiatives to develop digital infrastructures. Most recently, Kenya secured a $ 116.7 million funding deal from the European Union under the EU-Kenya Digital Partnership.
Foreign Direct Investment into Africa’s digital future
President William Ruto secured the deal in June covering a variety of digital transformation and connectivity development projects in Kenya. A key highlight of the deal is an investment of $42.3 million for the extension of the Google-backed Blue-Raman subsea cable network connecting Djibouti, Somalia, Kenya, and Tanzania.
The EU also agreed to invest $11.4 million to support the Digital Transformation Centre in Kenya that is meant to grow AI systems and create an enabling policy environment for digital trade and investment.
According to a press communiqué following the deal signing, the EU will, through its Global Gateway strategy, commit $ 17.1 million to the expansion of Kenya’s national fiber-optic network.
Notably, Kenya already has seven operational subsea cables, and at least two more are set to go online between by the end of 2027. According to the EU media release, Kenya’s data center market is expected to grow at a CAGR of 21% to reach a value of $ 805 million by 2031.
“For frontier market investors, the next wave of digital adoption will depend not only on innovation in major cities, but also on how effectively operators, regulators and policymakers extend networks to underserved communities,” reads the report.
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Africa’s space technology development attracts digital frontier investment
Development of digital infrastructure creates the foundation needed to attract investors into Africa’s digital market, from Kenya we find similar government initiatives across the continent in West Africa.
A recent diplomatic meeting between Senegal’s space agency and Egypt’s mission that was also held in June in Dakar offers more evidence that digital infrastructure a key investment determinant.
“African governments are increasingly viewing satellite capabilities, earth observation, geospatial intelligence and data sovereignty as strategic assets tied directly to economic competitiveness,” Senegal’s Agency for Space Studies (ASES) said in preaa release in the wake of the meeting with Egypt.
The report recalls that in February this year, Senegal’s Armed Forces and ASES signed a memorandum for strategic cooperation. The report says ASES plans to launch up to seven satellites come 2028.
The report goes on to point out that development of the digital frontier, in this case, expansion of Africa’s Space Technology, will determine the future of agriculture, mining, logistics, climate resilience, and telecommunications.
While Egypt already possesses one of Africa’s most advanced space programmes and is home to the African Space Agency (AfSA), Senegal is looking to leverage Egypt’s capacity to develop its own space programme aimed at boosting its digital connectivity that will determine speed of development across all sectors.
Senegal’s Director General of Senegalse Space Study Agency (ASES) Maram Kaire, met with Egypt’s Ambassodor Khaled Aref to discuss strengthening bilateral cooperation in space science and technology.
The two executives are reported to have discussed development of joint initiatives and partnerships to support research, innovation, capacity building and the application of space technologies for socioeconomic development.
“The engagement reflects growing efforts by African nations to leverage partnerships to advance national space capabilities and expand the use of space-based solutions in addressing development challenges,” ASES said in the media report.
Meanwhile, there is an intensifying global competition between the United States, China, Europe and Gulf states for influence across Africa, and it is the digital frontier that is been fought for. In this regard, development of Africa’s space technology is emerging as a new arena for diplomacy, investment and technological influence.
Development of Africa’s space technology covers all sectors, it will determine efficiency in governance as well as development of agriculture and food security, education and health, as well as general welfare and the quality of everyday life.
“Africa’s digital economy is expanding beyond fintech and mobile connectivity into data-intensive industries that will underpin future growth,” ASES notes.
It is now clear that countries that successfully integrate space technologies into agriculture, resource management and infrastructure planning will gain a productivity advantage in the coming decade.
“The question for investors is no longer whether Africa will participate in the space economy. It is which countries will capture the greatest value from it,” ASES concludes.
