• 54% of global General Partners say Africa will outperform other emerging markets over the next five years

• South Africa and Kenya top the list of attractive markets, ahead of Egypt and Nigeria

• Currency volatility remains the biggest concern for investors in African private equity

Africa is gaining momentum as a prime destination for private equity investments, according to a new report from the African Private Equity and Venture Capital Association (AVCA). The survey, published on April 17, 2025, shows that 54% of General Partners (GPs) believe the continent will be the most attractive emerging market over the next five years.

The report, titled AVCA Investors Sentiment & Outlook 2025, is based on responses from both General Partners and Limited Partners (LPs) active in Africa’s investment space. GPs manage private equity and venture capital funds, while LPs commit capital without being involved in day-to-day operations. The respondents represent firms from across the globe.

Among General Partners, 59% expect a rise in investment activity in 2025. For 71% of them, fundraising is the top priority. South Africa and Kenya are seen as the most promising markets by over 65% of GPs surveyed, while Egypt and Nigeria were each selected by around half of respondents.

Energy (50%), consumer goods (49%), and healthcare (45%) are viewed as the most attractive sectors for investment. But even with growing optimism, macroeconomic risks continue to weigh on sentiment. Currency volatility tops the list of concerns for 84% of General Partners. Another key worry is the impact of U.S. government policies, especially funding cuts that affect institutions helping to de-risk investments in Africa.

The outlook from Limited Partners is similarly upbeat. About 56% expect higher investment activity this year, although only 20% are confident about exits. Still, more than 90% plan to maintain or increase their capital commitments to Africa over the next three years.

Private equity and venture capital remain the dominant strategies, accounting for 56% of planned allocations. However, infrastructure and private debt funds are also gaining traction. Co-investment stands out as the most appealing opportunity for LPs, with 70% listing it as a priority. The financial sector is seen as the most attractive by 60% of these investors.

Among LPs, 76% cited currency volatility as a major concern, followed by rising geopolitical tensions, flagged by 72%.

Walid Kéfi