Policy Paper

Boosting Energy Investment in Emerging Markets

Energy and climate are reshaping international investment flows. In this context, North Africa stands out as one of the most dynamic and strategically positioned regions for both fossil and renewable energy development.

Algeria, Egypt, Libya, Mauritania, Morocco, and Tunisia form a diverse energy landscape characterized by substantial renewable energy potential and significant oil and gas resources. The region also benefits from a strategic geographical location at a crossroads between Sub-Saharan Africa, Europe, and the Gulf and surrounded by the Atlantic Ocean, the Mediterranean Sea, and the Red Sea. In 2024, North Africa had a combined population of approximately 225 million, a GDP of 918 billion USD, and an electricity generation capacity of 128 GW.

According to the United Nations 2025 World Investment Report, North Africa emerged as the main growth engine in the continent. This is illustrated by the 277% increase in Foreign Direct Investments (FDI) in 2024 that totalled 51 billion USD. This remarkable increase is mainly explained by adapted financial mechanisms, a growing commitment to promote greenfield projects, and decision-makers' serious engagement. Multilateral Development Banks (MDBs), International Financial Institutions (IFIs), and regional and international cooperation played a major role in making these projects achievable on the ground. Energy and offshore cable projects were among the leading investment drivers.