SA's GDP size Africa's largest, but growth likely to be continent's lowest for 2025 - new investment rankings

South Africa remains at number four in the investment rankings for African countries, according to the 2025/26 edition of the Where to Invest in Africa report (WTIIA), released by Rand Merchant Bank (RMB).

Seychelles and Mauritius retain their first and second spots as the continent's top investment destinations.

The significantly larger economies of Egypt, South Africa and Morocco remain ranked in third, fourth and fifth places, respectively.

The report, developed in collaboration with the Gordon Institute of Business Science (GIBS), analyses 31 African nations.

These represent 90% of the continent’s GDP, 83% of the population, and 61% of the total land mass.

The scoring system assesses countries through four key pillars: economic performance and potential; market accessibility and innovation; economic stability and investment climate; and socialand human development.

The 2025/26 edition explores the theme From aid to investment and trade, and highlights broader geopolitical trends and the imposition of US tariffs.

The report describes South Africa as 'economically stuck'.

"The country's GDP size may be Africa's largest, but GDP growth is likely to be the continent's lowest for 2025 at around 1% and very nearly the lowest on average to 2029 (1.5%)."

The assessment finds that the Government of National Unity (GNU) has struggled to act decisively on major issues, including rampant unemployment, transport infrastructure that starves many growth opportunities, and insufficient energy supply.

In contrast, how do the island nations of Seychelles and Mauritius manage to keep outperforming larger economies?

Their small economies mean they'd rank very low on economic potentialand performance (about 35% of the Index) but they are very competitive and rank highly with the other criteria that make up around 65%, explains RMB chief economist Isaah Mhlanga.

Africa has an important role to play in the world economy, says Mhlanga, citing factors like its trove of critical minerals, a young median population and agricultural potential to help feed billions of people globally.

"We just need to be able to create the right institutional frameworks that make sure that investors feel comfortable, that there's predictability so when they invest their money they know they'll realise the returns."

Scroll up to the audio player to hear more on the Where To Invest In Africa report from Mhlanga