East Africa Energy Summit Sparks Investment and Economic Growth
Shikana Group
Leading investment and advisory firm specialized in foreign investments in Africa.
???? I.??????????? INTRODUCTION
Hello and welcome to this week’s edition of our investment newsletter! As we enter February, we are excited to share the latest updates on East Africa’s investment landscape with you!
It is no secret that in order to achieve rapid economic growth in the double digits, energy security is imperative. East Africa is definitely taking this seriously as it held the East Africa Energy Cooperation Summit (EA-ECS) held on January 29–30, 2025, in Arusha, Tanzania. This brought together policymakers, investors, and energy leaders to explore opportunities in renewable energy, infrastructure development and cross-border energy trade.
The government of Tanzania hosted in Dar es Salaam the Mission 300 Africa Energy Summit held on January 27-28, 2025 along with ?the World Bank Group and African Development Bank Group. The Summit was an opportunity for governments, private sectors, development partners, and civil society to advance the goal of providing electricity access to 300 million people by 2030.
Beyond energy, East African economies are witnessing positive credit rating shifts, increased foreign direct investment, and strategic economic reforms, which are reshaping the region’s business landscape. From Tanzania’s clean energy transition to Kenya’s improved fiscal outlook, Uganda’s French investment partnerships, and Rwanda’s surge in foreign direct investment (FDIs), the region is positioning itself as an attractive hub for investors. In this edition, I’ll take you through the key highlights from the summit, major investment trends, and insights shaping East Africa’s economic future.
? II.??????????? TREND OF THE WEEK
East Africa Energy Summit sparks investment
Did you know that by 2050, data centers will account for 20% of global energy consumption? This presents a major opportunity for East Africa’s energy sector to attract investors. The East Africa Energy Cooperation Summit (EA-ECS), that took place on January 29-30, 2025 in Arusha, Tanzania, brought together energy leaders, Independent Power Producers (IPPs) , and Engineering, Procurement and Construction- Finance (EPC-F) stakeholders to explore the vast investment opportunities and innovations emerging in East Africa.
The EA-ECS also showcased the importance of regional collaboration, with the EAC playing a pivotal role in bringing together policy makers, investors, and energy sector stakeholders to promote deeper integration. This collaboration reflects the EAC’s vision of driving industrialization and enhancing cooperation among member states. There were several significant outcomes, reinforcing the region’s energy investment potential and the importance of regional collaboration. The EA-ECS attracted increased investor interest, particularly in renewable energy and infrastructure, with discussions focusing on independent power production (IPPs) and cross-border energy trade underscored the necessity of grid stability to facilitate industrial expansion, particularly in sectors like mining and digital infrastructure. Private sector engagement was also a key focus.
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The Africa Energy Summit held on January 27-28, 2025 thirty (30) African Heads of State and Governments endorsed the Dar es Salaam Energy Declaration, a landmark commitment to expand reliable, affordable, and sustainable electricity access across the continent. Additionally, the Summit had twelve African countries present their National Energy compacts.? Each country identified specific policy measures to address constraints across the energy sector. Countries are encouraged to hold public consultations with civil society and other relevant stakeholders to inform the development of the compacts. These countries include Chad, Cote D'Ivoire, Democratic Republic of Congo, Liberia, Madagascar, Malawi, Mauritania, Niger, Nigeria, Senegal, Tanzania and Zambia.[AS2]?
Finally commitments were made by ?international development institutions which pledged significant financial support:
·???????? African Development Bank Group & World Bank Group: USD 48 billion for energy access through 2030.
·???????? Agence Fran?aise de Développement (AFD): USD 1 trillion to support energy expansion.
·???????? Asian Infrastructure Investment Bank (AIIB): USD1 billion – USD1.5 billion for Mission 300.
·???????? Islamic Development Bank (IsDB) Group: USD 2.65 billion from 2025-2030.
·???????? OPEC Fund: USD 1 billion for energy access initiatives.
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?The World Bank Group and the African Development Bank (AfDB) have introduced Zafiri, an investment platform aimed at supporting private businesses that provide solutions like small renewable energy grids and solar home systems. In the first phase, key partners will invest USD 300 million, with the goal of raising USD 1 billion to help bridge Africa’s energy funding gap.[AS3]?
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III.??????????? TOP HEADLINES
Tanzania
1.??? Tanzania’s clean energy transition: Samia unveils national strategy
?The Mission 300 Africa Energy Summit, held on January 27-28 in Tanzania, convened African and global leaders from the public, private, and the energy sectors to commit to the ambitious goal of accelerating energy access for 300 million people in Africa by 2030. Twelve African countries presented their National Energy Compacts at the Summit, each identifying specific policy measures to address constraints across the energy sector and setting targets.
President Samia Suluhu Hassan presented and launched Tanzania’s National Energy Compact.?The initiative aims to accelerate electricity access in the country, targeting 75% coverage by 2030. To achieve this goal within the next five years, Tanzania needs an investment of USD 13 billion (approximately TZS 32.8 trillion) of which USD 5 billion (around TZS 12.5 trillion) is anticipated to come from the private sector. The current electricity generation stands at 3,431.20 Megawatts (MW), with 58 % sourced from hydropower, 35% from natural gas, and 7% from other sources. The country’s goal is to add 2,463 Megawatts (MW) of energy from solar, natural gas, wind, geothermal, and other sources by 2030.
?Furthermore, in Tanzania, over 90% of households rely on firewood and charcoal for cooking and the country cannot overlook the severe health and welfare impacts this has on women and girls. To address this, Tanzania has adopted a National Clean Cooking Energy Strategy aimed at increasing the use of clean cooking energy from less than 10% to 80% by 2034 creating investment opportunities in key areas such as LPG, biogas, ethanol and electric cooking solutions.
Kenya
2.??? Moody's revises Kenya's credit outlook to 'positive'
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After months of severe austerity measures being implemented to comply with the IMF, currency devaluation, civil unrest and wide spread discontent from the private sector, it would seems that things may be turning around as Kenya’s fiscal position has received a boost after global credit rating agency, Moody’s, revised the country’s credit outlook from “negative to positive.”
Moody’s, however, affirmed that the local and foreign-currency long-term issuer ratings and foreign-currency senior unsecured debt ratings still stand at CAA1. Moody’s cited potential ease in liquidity risks and improving debt affordability over time for the positive rating. Domestic financing costs have started to decline amid monetary easing and could continue to do so if the government sustains its more effective management of social demand and fiscal consolidation.
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Uganda
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3.??? France Commits to Invest USD 4 billion [AS6]?in Uganda in 2025
France is set to deepen its economic partnership with Uganda, with French companies committing USD 4 billion (UGX 15 trillion) in investments in 2025. These funds will target vital sectors like water, energy, agriculture, and mining while creating thousands of jobs and building local skills. The 40 French companies operating in Uganda already support thousands of direct and indirect jobs while providing 46,000 hours of training annually. In the coming weeks, it is expected that there will be more partnerships from additional delegations from the mining, water and agribusiness sectors. This investment aims to accelerate Uganda’s economic growth, create jobs and opportunities for investors. The water sector is a key focus, with USD 95 million out of the total USD 4 billion?allocated to expand access in northern Kampala, benefiting 500,000 people. Agriculture is another critical area, with French cooperation supporting projects such as the “Rwenzori Mountain of the Moon IG Coffee “benefiting 11,000 producers. The main goal of this initiative is to help Uganda create value within its agricultural sector while providing the tools for long-term resilience, create an ecosystem where business can thrive and contribute to Uganda's development.
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Democratic Republic of Congo
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4.??? "Global Gateway Green Corridor”: A New Era for Green Growth and Cross-Continent Connectivity
The European Commissioner for international partnerships Jozef Síkela confirmed European Union (EU) support for the groundbreaking programme called the Green Corridor Kivu-Kinshasa, just announced by President of Democratic Republic of Congo (DRC) Felix Tshisekedi. This support to Democratic Republic of Congo’s Green Corridor is a transformative Global Gateway initiative which aims to help establish a sustainable 2,600 kilometers corridor connecting Eastern DRC to Kinshasa and the Atlantic Coast covering 540,000 kilometers. It is expected to improve the livelihoods of DRC’s citizens through increased agricultural production and inclusive economic development whilst preserving DRC’s unique biodiversity considered as the last lungs of the earth.
This Global Gateway is all about connecting communities in partner countries, empowering local producers, fostering environmental protection and improving security. This initiative lays the foundation for a greener and more prosperous future. It also represents a step towards mobilizing European and local private sector and building the infrastructure and governance needed to unlock the full potential of the corridor for the benefit of all.
This Global Gateway initiative is designed to achieve three strategic objectives for the DRC’s long-term development. The first is to enhance connectivity by bridging Eastern and Western DRC to facilitate the transportation of important commodities and unlock sustainable development opportunities along the corridor.
Secondly, to strengthen agricultural value chains by supporting local small holder producers and transformation through agro ecological practices that respect biodiversity, while boosting livelihoods and regional security. Lastly, to protect biodiversity and human rights through improved governance, notably the establishment of the community reserve following a free prior informed consent of the local communities regarding economic development and biodiversity conservation on their land. Once fully operational through the mobilization of the private sector and the support of Team Europe, the Global Gateway Green Corridor will facilitate the annual transport of 1 million tons of agricultural products from the Kivu region to Kinshasa, including a flow of goods from the capital to the East as well. It will straddle the strategic continental corridors namely Corridor 6 (Douala – Kampala) and Corridor 8 (Mombasa – Kisangani), which are jointly supported by the African Union and the European Union.
Given the developments in with the M23 invasion of Kivu, we will have to see whether or not this project will be implemented given the insecurity and uncertainty in the East of Congo.
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Rwanda
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5.??? Rwanda Sees Significant Surge in Foreign Direct Investment
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Despite accusations of Rwanda’s dealings in Eastern Congo and that the government is backing M23 rebels, it continues to attract more investment from international business, with a significant rise in Foreign Private Capital (FPC) inflows with Mauritius, the United States, and Europe being the biggest drivers of the growth, according to the Foreign Private Capital 2024 – Survey Report compiled by the National Institute of Statistics (NISR) and released on 22nd January 2025.
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In 2023, these inflows grew by 33.8%, reaching USD 886.9 million, up from USD 663 million in 2022, .The financial sector brought in the most investment, with USD 236 million, making up 26.6% of total inflows. This was followed by manufacturing (USD 165.2 million, 18.6%) and Information and Communication Technology (ICT) (USD 107.4 million, 12.1%). One standout sector was agriculture, which saw investments grow by an impressive 123.5%. Real estate also made headlines with a massive 1,552% increase in foreign investment. This suggests that international investors see opportunities in Rwanda’s growing cities and housing market. This highlighted increase shows that more foreign companies and investors are choosing Rwanda as a place to do business, helping to grow the economy and create jobs.. The total turnover (or sales revenue) of foreign-funded companies in Rwanda grew by 18.2%, reaching USD 3.6 billion in 2023 which accounts for nearly 26% of the country’s GDP.
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The increase in investment has also meant more jobs for Rwandans. The number of people employed by companies funded through FPC rose by 20.3%, with 59,916 people employed in 2024 compared to 49,790 in 2023. As Rwanda continues to strengthen its investment climate, these trends suggest a promising trajectory for sustained economic growth and development in the coming years.
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Ethiopia
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6.??? IMF backs Ethiopia’s tax reforms to boost revenue amid economic challenges; warns inflation could hit 25% after mid-2025
Ethiopia is moving ahead with tax reforms aimed at boosting revenue, with new measures to streamline exemptions and close corporate tax loopholes, according to the International Monetary Fund (IMF). The tax exemptions are for imported intermediate inputs for new local and foreign investments.
The key updates on tax and economic reforms are that the e government is considering amendments to personal income tax exemptions to improve on fairness while maintaining revenue collection targets. These reforms have been met with parliamentary resistance where some Members of Parliament (MPs) and stakeholders having raised concerns about the financial burden on fixed-income earners, questioning the need for additional taxes given the recent increase in revenue collection. There will also be new tax categories and expansions as the government plans to broaden the tax base, including amendments to the VAT and excise tax laws and the introduction of property and environmental taxes. In addition to this, the government’s ?revenue goals for 2024/2025 are to collect USD 11.8 billion ?as part of its Homegrown Economic Reform Agenda. Lastly Ethiopia’s?USD 3.4 billion IMF program under the Extended Credit Facility (ECF) is ongoing, with the second review completed on January 17, 2025, leading to an immediate disbursement of USD 248 million, bringing total funding to USD 1.611 billion
As is custom of IMF programs, the credit facility comes with severe economic measures such as higher electricity tariffs, revised tax laws, and increased service fees, which will further strain households. While the government has implemented measures to curb inflation and adjust public sector salaries, experts also caution that these reforms disproportionately burden lower-income groups.
IV.??????????? UPCOMING EVENTS
1)?? Invest in Africa Summit 2025
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Date: April 29-30, 2025
?Agenda:? Focus on unlocking trade and investment opportunities across the continent.
领英推荐
How to Register: Online at register online at www.investinginafrica.eu
Location: Van der Valk Hotel Den Haag, Wassenaar, Netherlands?
Time: 9:00 AM - 5:30 PM
Who Should Attend:
·???????? Global investors
·???????? Entrepreneurs
·???????? Business leaders
·???????? Government officials looking to explore investment opportunities in Africa.
Key Features:
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·???????? Exclusive networking with investors, CEOs, and industry experts
·???????? Investment deal rooms for startups and businesses seeking funding
·???????? High-potential project showcases in agribusiness, digital technology, infrastructure, and energy
·???????? Expert-led panels & workshops on Africa’s investment climate and growth strategies.
·???????? Engaging social events, including an African fashion show and innovation awards
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2)?? Africa CEO Forum 2025
Date: May 12-13, 2025
Agenda: Continental summit focused on advancing Africa’s private sector by addressing key economic and business priorities.
Location: Sofitel Abidjan Hotel Ivoire, Abidjan, Cote d’Ivoire
Registration: To register, you can visit this link [email protected] and [email protected]?for sponsorship inquiries.
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Who Should Attend:
·???????? Business leaders
·???????? Investors
·???????? Political decision-makers
·???????? Key stakeholders in sectors such as finance, agriculture, infrastructure, ICT, oil and gas, and transportation.
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Key Features:
·???????? High-level discussions on African economic transformation
·???????? Business-to-business meetings
·???????? Networking events
·???????? Digital transformation and regional integration panels
·???????? Leadership and financing strategy discussions
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?V.??????????? OPINION OF THE WEEK
"East Africa is at the cusp of a transformative economic period, with projected GDP growth rates that are among the highest globally. The investments being made in infrastructure, energy, and the private sector are shaping a future ripe for transformative business opportunities.”
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Dr. Akinwumi Adesina, President of the African Development Bank (AfDB)
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VI.??????????? CONCLUSION
??The East Africa Energy Summit has provided a crucial platform for discussing the region’s growing energy needs and the innovative solutions required to meet them. It highlighted the importance of energy access for economic development, underscoring the need for infrastructure investments, clean energy solutions, and greater regional cooperation. The discussions were centered around enhancing energy security, driving industrialization, and addressing climate challenges through sustainable energy sources.
One of the standout initiatives emerging from the summit is Mission 300, a bold and ambitious plan aimed at electrifying 300 million people across Africa by 2030. This initiative serves as a critical step in closing the energy access gap, especially in rural and off-grid areas, where millions still live without reliable electricity. By leveraging a combination of grid expansion and decentralized renewable energy solutions such as solar power, Mission 300 holds the potential to transform communities, improve quality of life, and drive economic development.
As East Africa looks to the future, the success of the energy sector will rely heavily on strategic partnerships between governments, private investors, and development agencies. Collaborations will be key to overcoming the financial, technical, and political challenges facing the energy sector. The summit's discussions on policy alignment, innovative financing mechanisms, and investment opportunities have set the stage for continued growth and transformation. Beyond energy, significant strides are being made across multiple sectors. Tanzania is advancing its clean energy transition with bold targets for clean cooking energy and increased electricity generation. Kenya's improved fiscal outlook has made it an attractive investment destination, especially in infrastructure, renewable energy, and agriculture. Uganda is set to benefit from French investments aimed at boosting water, energy, and agriculture, while Rwanda’s surge in foreign direct investment is transforming its economy. In the Democratic Republic of Congo, the Green Corridor initiative promises to unlock sustainable growth, though security challenges remain a concern. We’re committed to keeping you updated on the latest investment prospects and economic trends, offering valuable insights to help businesses and investors navigate the dynamic opportunities in East Africa. Stay connected for more updates on market shifts and policy changes that are shaping the region's economic landscape.
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VII.??????????? RESOURCES
1.?????? African Review (2025) East Africa Energy Summit
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2.?????? Daily news (2024) National Energy Compact
3.?????? Star news (2025) Moody’s credit outlook
4.?????? Chimp reports (2025)
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5.??? European commission (2025) Global Gateway
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6.??? Ktpress (2025) Record Increase in Foreign Private Capital
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7.?????? Addis Standard (2025)? Ethiopia’s tax reforms
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