Category: Africa Business

As Africa continues to look for ways to diversify its economic base and stimulate inclusive growth, the tourism and hospitality sector is starting to emerge as a powerful yet underleveraged driver of GDP. With its rich cultural heritage, breathtaking landscapes, vibrant cities and warm hospitality, the continent holds immense potential to become one of the world’s leading travel destinations. More importantly, tourism represents far more than leisure; it is a multidimensional catalyst for employment, infrastructure, foreign exchange earnings, and national branding.

Globally, tourism contributes over 10 percent to GDP and accounts for one in ten jobs. In Africa, however, the average contribution of tourism to GDP hovers around 7 percent, with even lower figures in countries where tourism is not yet formalised or scaled. This disparity does not reflect Africa’s potential; it is a relatively untapped opportunity.

From the city walls of the Benin Kingdom, pyramids of Egypt and the Maasai Mara plains of Kenya to the beaches of Seychelles and the historical slave ports of Senegal, Africa is brimming with stories, scenery, and experiences the world craves. The African Union’s Agenda 2063 recognises this by highlighting tourism as a critical pillar for socio-economic transformation.

The hospitality industry, which comprises hotels, resorts, restaurants, travel services, and events, forms tourism’s physical and experiential backbone. Its development is key to attracting and retaining international visitors, boosting domestic travel, and enabling regional integration through intra-African tourism.

Well-developed hospitality infrastructure also supports business travel, conferences, sporting events, and diaspora homecomings, all inject capital into local economies. For every hotel built or upgraded, a ripple effect follows: jobs are created, local suppliers are engaged, transportation networks improve, and tax revenues increase.

Countries like Rwanda, South Africa, Cape Verde, Kenya, Morocco, and Mauritius are already reaping the benefits of strategic hospitality development. Rwanda’s investment in eco-tourism and conference tourism has turned Kigali into a model city for African meetings. At the same time, South Africa’s diverse attractions continue to draw millions of global travellers each year.

Tourism and hospitality are uniquely positioned to create opportunities for Africa’s youth. These industries are labour-intensive and require various skills, from culinary arts and customer service to digital marketing and tour guiding. Millions of young Africans can be empowered to participate in the value chain with targeted vocational training and entrepreneurship support.

Small businesses, especially women-led enterprises, thrive in this sector, offering handmade crafts, cultural performances, local cuisine, and personalised travel services. Governments can unlock inclusive economic participation and reduce unemployment among vulnerable groups by investing in tourism.

To transform tourism and hospitality into an actual engine of GDP growth, African nations must address key enablers such as Improved infrastructure like roads, airports, electricity, and broadband connectivity. These are essential for attracting international and regional tourists.

Simplified visa processes and pan-African travel policies can boost intra-African tourism, which is currently hindered by travel barriers. Africa must as a matter of urgency start to tell its story through coordinated campaigns showcasing its safety, hospitality, and uniqueness.

The importance of having a stable and secure political and social environment across the continent reassures investors and travellers alike.

Tourism is more than economics; it is a tool of diplomacy and identity. It shapes how Africa is perceived, strengthens cultural pride, and builds bridges between nations. A thriving tourism industry enhances a country’s soft power, promotes intercultural dialogue, and reinforces a sense of unity and possibility across the continent.

Events like Afrochella in Ghana, the Lake of Stars Festival in Malawi, and the Cape Town Jazz Festival in South Africa show how tourism can be fused with creative industries to elevate national influence and continental integration.

Africa’s future prosperity depends on economic sectors that are inclusive, sustainable, and scalable. Tourism and hospitality meet all three criteria. With intentional investment, policy support, and stakeholder collaboration, the sector can grow from a supplementary industry into a primary contributor to GDP and societal wellbeing.

The time is now for African nations to see tourism as an add-on to development and a strategic transformation lever. In doing so, they will attract the world to Africa and empower Africa to shine brightly from within.

The African startup ecosystem continues to attract strong investor appeal despite global headwinds, with 39 African startups raising a combined $187.6 million in recent deals, although three of those companies choose not disclose the amounts raised.

Data compiled by Tolulope Omotunde of AfrikDigest show that the top 10 startups alone attracted over $167.1 million, highlighting where investor appetite is strongest, with South Africa emerging as the clear frontrunner, accounting for more than half of total inflows, while Nigeria, Kenya, Egypt, Ghana, and Rwanda also secured significant rounds.

The analysis spotlights the top 10 African startups that raised capital recently, breaking down their contributions by country, region, and sector, and highlighting the investment trends shaping the continent’s entrepreneurial landscape.

Regional breakdown of funding

A closer look at the data shows that Southern Africa dominated with $93.3 million in total funding, driven almost entirely by a single landmark deal, Ikhokha’s $93.3 million acquisition by Nedbank.

This accounted for 55.8% of the top 10 pools, underscoring how one mega-deal can tilt the scales in Africa’s venture capital landscape.

Eastern Africa followed with $29.4 million (17.6%), spread across four startups in diverse sectors, including healthcare, telecom, services, and logistics. Kenya alone contributed three of these deals, confirming its position as East Africa’s innovation hub.

Western Africa attracted $25 million (15%), led by Nigeria’s Koolboks ($11 million) and Chowdeck ($9 million), while Ghana’s Complete Farmer chipped in $5 million. The region’s strength remains in energy-tech and agriculture, where investor demand is growing steadily.

Northern Africa, represented solely by Egypt, posted $19.4 million (11.6%). Breadfast ($10 million) and ValU ($9.4 million) demonstrate how fintech and food tech continue to attract capital in the region despite macroeconomic pressures.

Top 10 African startups that raised funds in August 2025

10. Poa Internet (Kenya) – $4 million

Kenya’s fourth-largest internet service provider secured $4 million in debt funding from Finnfund. Poa is doubling down on underserved urban markets, where it already commands a 13.8% market share with over 238,000 subscribers.

9. HoneyCoin(Kenya) – $4.9 million

Nairobi-based fintech HoneyCoin raised $4.9 million in seed funding to scale its stablecoin-compatible payments infrastructure across Africa, Latin America, and Asia. Flourish Ventures and Visa Ventures were among the round’s high-profile backers.

8. Complete Farmer (Ghana) – $5 million

Agritech firm Complete Farmer secured $5 million in debt financing from Symbiotics as part of a broader $22 million Series A. The funds will help scale its digital platform, connecting farmers with global commodity markets.

7. Chowdeck (Nigeria) – $9 million

On-demand delivery startup Chowdeck raised $9 million in Series A funding, led by Novastar Ventures. The company is expanding aggressively in Nigeria and Ghana, with plans to open 40 dark stores by year-end and 500 by 2026.

6. ValU (Egypt) – $9.4 million

Consumer fintech platform ValU issued a securitised bond worth $9.4 million, the 17th tranche of its financing program. The funds free up liquidity to expand its “buy now, pay later” and consumer credit services across Egypt.

5. Breadfast (Egypt) – $10 million

Online grocery delivery platform Breadfast secured $10 million in Series B2 financing led by EBRD and Novastar Ventures. The company, which processes nearly 1 million orders monthly, plans to expand its fulfillment centers and fintech arm, Breadfast Pay.

4. Ampersand (Rwanda) – $10 million

E-mobility startup Ampersand raised $10 million from British International Investment to grow its electric motorcycle fleet and battery-swap infrastructure across East Africa’s $10 billion boda-boda market.

3. Hewatele (Kenya) – $10.5 million

Kenya’s leading medical oxygen supplier, Hewatele, raised $10.5 million from Transform Health Fund. The capital will expand oxygen production facilities to meet the region’s growing healthcare demands.

2. Koolboks (Nigeria) – $11 million

Koolboks, a Nigeria- and France-based cleantech startup, raised $11 million in a Series A round led by KawiSafi Ventures and Aruwa Capital. The funding will support the large-scale deployment of solar-powered cold storage across Africa. This round brings Koolboks’ total funding to $15.4 million, with an additional $3.5 million raised in 2022.

1. ikhokha (South Africa) – $93.3 million

South African fintech Ikhokha was acquired by Nedbank in a $93.3 million deal, making it the largest transaction of the period. The acquisition allows Nedbank to integrate Ikhokha’s mobile payments solutions into its SME banking ecosystem.

This $93.3 million M&A deal is a landmark for South African fintech. It reflects growing investor confidence in SME-focused digital solutions and highlights the role of strategic acquisitions in accelerating financial inclusion.

With Nedbank’s backing, iKhokha is poised to scale its technology and reach, transforming how small businesses transact, grow, and thrive.

Africa is the second-most populous and second-largest Continent on earth after Asia, with vast and majorly untapped economic potentials. The continent is without a doubt one of the world’s fastest-growing regions and opens its borders to business investments with rewarding opportunities. With an estimated $8.7 trillion in business and consumer spending and over 1.9 billion people, Africa is a lucrative and tantalizing prospect for global businesses. But Africa is not without its own challenges, especially in the business sector. This piece zeroes in on the critical challenges of doing business in Africa. Tolulope Omotunde of Afrik Digest looks at some critical factors that can pose challenges to business ventures on the continent.

According to The World Bank, the failure of the developed world to help Africa tackle its labour shortages will have an adverse effect on global business. The continent’s labour shortage and the lack of skilled professionals affect organizations scaling their operations. Despite a young and vibrant population, skilled labour is short in Africa because a lot of countries misalign training and schooling programs. Furthermore, poor education budgets and weak educational structures failing to nurture skills for the labour market are other reasons. According to The World Bank, Niger, Chad, Burkina Faso, Mali, Central African Republic, Mauritania, Burundi and Ethiopia are the leading countries with the worst education systems in 2023. So the advice for people or organizations that are looking to start a business in Africa, consider attracting talents by providing support and offering on-the-job training. Africa has a highly educated population capable of excelling at any job with the proper training. Besides, encouraging staff with the potential to learn new skill sets will help businesses on the Continent bridge the gap on skilled labour shortage.

Despite improvements from different governments, electricity remains a major challenge in the region. With over 600 million Africans without access to electricity, the continent needs a significant scale-up in electricity investment. Electricity is critical for businesses to control the cost of energy and production. Many companies operate industrial machinery and motors, ventilation, office equipment, lighting, and facility heating that requires electricity to generate revenue. The lack of electricity access limits the quality of life, provision of public services, and modern economic activities in Africa. Insufficient supply often leads to loss of productivity and revenue shortage for companies. Despite the electricity challenge, focusing on African countries making giant strides in the sector is essential. According to Energy Capital Power, Egypt, Morocco, Tunisia, Algeria, and Gabon will be Africa’s most electrified countries in 2024. Considering renewable energy alternatives and how to collectively or individually fund them before starting a business in Africa will be critical.

As regards supply chain, Africa has unique supply chain challenges with its population and sheer size. In addition, the continent has an overall weak infrastructure, and movement between countries can disrupt your business supply chain. It isn’t easy to facilitate face-to-face business transactions, but transferring goods to the end consumer in Africa is also challenging. Many African companies have become quite creative with moving goods due to supply chain and transportation barriers. For example, companies like Dangote and Coca-Cola have armies of entrepreneurs biking and walking products to the end consumer. Those who want to lay a successful business foundation in Africa should consider approaching innovative ways to bridge the supply chain gap. Partnering with local service providers and communicating and optimizing inventory are other ways to approach the distribution challenge.

Another critical factor that poses challenges for businesses are regulations and government policies. They tend to hinder African business growth. Governments create policies and frameworks that impact businesses; these policies change from time to time. Regulations and policies influence interest rates, which reduces customer spending and business revenue growth. Getting regulatory permits, registering new property, protecting investors, and starting a new business can be challenging in Africa due to changing policies. These policies also affect companies’ ability to build long-term business growth plans. While many countries are significantly improving in ease of doing business, Africa needs more work to compete globally. Africans generally believe nobody fights and wins the government, but you can lay a successful business foundation with a team. Therefore, companies need to be more proactive and strategic with their dealings with African governments, especially when challenging the private sector policy decision makers.

According to the World Bank, Africa has a high cost of securing capital to start a business compared to other regions. Getting capital from African banks to start a business often comes with high-interest rates, and repaying affects businesses’ reinvestment programs to fuel growth. In addition, bank rates are high for a lack of resources to prove the creditworthiness of individuals and businesses. It is a key reason why majority of African businesses fail to scale and expand beyond the continent’s shores. Meanwhile, fintech companies on the Continent are providing solutions for business finance at more equitable rates. Securing capital equitably from fintech companies to scale a successful business in Africa might be the way to go. Building a successful business in Africa differs from other places. One would experience little success if these problems aren’t tackled before setting up the business. Opportunities abound in the African market if a sustainable strategy for business growth can be developed.

Just when it seemed like Africa’s economies may be making a recovery from the COVID-19 pandemic, a range of internal and external shocks struck such as adverse weather conditions, violent changes in governments and the Russian invasion of Ukraine – all of which worsened the already rapidly rising rates of inflation and borrowing costs in 2022.

The argument may even be made that the direct trade and financial linkages of Africa with Russia and Ukraine are minute, but the evidence is there for all to see of how the war has damaged the continent’s economies through higher food and commodity prices, fuel, and headline inflation.

Despite all these challenges, Africa still stands strong as home to some of the world’s fastest-growing economies.

According to the International Monetary Fund – IMF’s recent World Economic Outlook, 5 of the world’s fastest-growing economies are Angola, Ethiopia, Nigeria, Kenya and South Africa as reported by various news sources. The economies of these countries could quadruple in size and its growth is expected to be at 3.6% in 2023 and rise to 3.9% in the year 2024.

1. Angola – Angola is set to reclaim its spot as the third-largest economy in sub-Saharan Africa, thanks to a return to growth linked to higher oil prices. Angola is the continent’s second-largest oil producer after Nigeria and is also a significant producer of rough diamonds. The IMF expects Angola’s GDP to expand by 8.6% this year, reaching $135 billion. This is a significant increase from previous years, and Angola’s economy will likely continue to grow in the coming years.

2. Ethiopia

   

   – Ethiopia is set to replace Kenya as the fourth-largest economy in sub-Saharan Africa, according to the IMF. This is due to the easing of armed conflict in the nation and the continuation of ambitious economic reform efforts aimed at opening up one of Africa’s fastest-growing but most closed economies. The IMF predicts Ethiopia’s GDP will reach $126.2 billion this year, expanding by 13.5%. This is an impressive figure, and Ethiopia’s economy will likely continue to grow in the coming years.

3. Nigeria – As the largest economy on the continent, Nigeria maintains its top spot in sub-Saharan Africa’s economic rankings. The IMF predicts that Nigeria’s GDP will hit $574 billion this year. This is an impressive figure, and Nigeria’s economy will likely continue to grow in the coming years.

4. South Africa – The IMF predicts that South Africa will retain its position as the second-largest economy in sub-Saharan Africa, with a GDP of $422 billion this year. This is an impressive figure, and South Africa’s economy will likely continue to grow in the coming years.

5. Kenya – According to the IMF, Kenya’s GDP is projected to record a slower growth of 2.4% this year due to the aftershocks of the Covid-19 pandemic, drought, election jitters, and disruption of global supply chains. The IMF predicts that Kenya’s GDP will reach $117.6 billion this year, behind Angola and Ethiopia. Despite this slower growth, Kenya’s economy is still one of the top economies to watch in the region.