The Democratic Republic of Congo (DRC) saw foreign direct investment (FDI) activity reach a decade-high in 2020, countering a crunch seen across emerging markets caused by the pandemic.
The country attracted 12 greenfield foreign investment projects last year, up from five in 2019, matching its decade-high seen in 2011, according to data from investment tracker fDi Markets. This increase in activity is counter to the 45% decline in greenfield FDI projects seen across sub-Saharan Africa.
The communications sector drove much of the activity, accounting for three total projects in 2020, as the likes of China Mobile International, Egypt-based Benya, and US-based Raxio announced projects to lay the foundation of the country’s digital communications infrastructure.
In recent years, the DRC government has been actively engaged in trying to expand its ICT infrastructure, demonstrated by the 2018 revised telecommunications act, which aims to improve regulation of the sector and update the laws to fit with the country’s needs.
The resilience of the communications sector was echoed across the African continent, increasing 84% in terms of project numbers from 2019 to 2020 and accounting for a 30% share of announced capital investment in 2020, compared to 5% in 2019.
The DRC also recorded its first two renewable energy projects in seven years, as US-based Sun Plus and Mauritius-based DPA Africa Asset Co both announced plans to develop solar power in the country last year.
The country has seen a general decline in investment projects engaged in the metals sector since 2018. The decline coincides with the launch of the DRC’s national strategic development plan, which was announced in 2019 under president Félix Tshisekedi’s newly elected government. It aims to diversify the economy by shifting away from the reliance on mining and agriculture for jobs and revenue and to strengthen its financial sector.
Within the new development plan, the DRC is also aiming to improve its business climate to attract foreign investors through reducing red tape surrounding permits and business creation.