Africa could more than double its economic output by 2040 if countries across the continent scale up yearly infrastructure investment to USD 155 billion, according to a new joint assessment released by the Organisation for Economic Co-operation and Development (OECD) and the African Union Commission (AUC).
The report, Africa’s Development Dynamics 2025: Infrastructure, Growth and Transformation, revealed that Africa invested an average of USD 83 billion or 3% of GDP annually in infrastructure between 2016 and 2020.
Raising this figure to 5.6% of GDP or USD 155 billion a year could boost Africa’s annual growth rate by up to 4.5 percentage points and place the continent on a trajectory to exceed the African Union’s Agenda 2063 target of 7% growth.
The analysis suggests that such an investment surge would unlock large-scale productivity gains, strengthen regional integration, reduce trade barriers, and effectively double Africa’s total GDP within 15 years.
Countries Leading the Pace
A few African states are already nearing this threshold. Comoros, Lesotho, Tanzania and Zambia currently invest more than 5% of their GDP in infrastructure — levels comparable to fast-growing Asian economies such as China (6.7%) and Vietnam (5.1%).
These early movers, the report notes, demonstrate the scale of transformation possible when sustained infrastructure commitments are prioritised.
Governments Shoulder the Bulk of Spending — But Fiscal Pressures Are Growing
African governments currently finance 41% of all infrastructure spending. However, the report warns that fiscal space is tightening rapidly as countries face rising repayment obligations.
Between 2019 and 2023, African governments spent seven times more on debt servicing than on infrastructure, limiting the capacity to scale up capital projects despite rising demand for roads, rail, digital connectivity, clean energy, and logistics infrastructure.
This trend, according to the report, may hinder long-term growth unless countries adopt stronger public investment management, re-prioritise infrastructure in budgets, and implement reforms to improve cost recovery and maintenance.
Development Partners Provide Nearly Half of the Funding, but Outlook Is Uncertain
Bilateral and multilateral development partners currently account for 48% of Africa’s infrastructure investment.
Official development finance for infrastructure climbed from USD 10 billion in 2010 to roughly USD 15 billion in 2023, while development-bank disbursements rose from USD 4.2 billion to USD 8.2 billion during the same period.
However, the outlook is weakening. Official development assistance to Africa is projected to fall by up to 17% in 2025, following a 9% decline in 2024.
Least-developed countries may be the worst hit, with aid flows to sub-Saharan Africa expected to drop by 16% to 28%, raising concerns about funding gaps for critical infrastructure.
Private Capital Holds the Key to Future Growth
Private-sector investment currently contributes only 11% of Africa’s infrastructure financing — significantly lower than other global regions — despite offering potential returns of up to 20%, among the highest worldwide.
The report stresses that scaling up private investment is essential to meeting future needs and recommends:
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Prioritising high-return sectors: transport networks, digital infrastructure, and solar energy
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Aligning national and regional plans to enhance coherence across development corridors
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Strengthening public–private partnerships to improve bankability of projects
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Building reliable data systems and regulatory frameworks to help investors identify opportunities
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Integrating environmental and social safeguards into infrastructure planning to attract long-term capital
Outlook: A Defining Moment for Africa’s Economic Transformation
The OECD and AU conclude that closing Africa’s infrastructure gap is not simply a financial challenge — it is an economic transformation opportunity.
With coordinated reforms, improved governance, and deeper private-sector involvement, the continent could unlock one of the largest growth accelerations globally over the next two decades.
Scaling infrastructure spending to USD 155 billion annually, the report notes, could shift Africa’s economic trajectory from gradual expansion to sustained, rapid growth — shaping a more integrated, competitive, and prosperous continent by 2040.