African govts tipped on prioritising investments for manufacturing sector

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Continued underinvestment in the manufacturing sector on the African continent is to blame for the slow growth in the sector.

The observation was made by Uganda Development Corporation executive director Dr Patrick Birungi on November 19, 2025, during the ongoing 4th Africa Industrialisation Week taking place at the Speke Resort Munyonyo in Kampala city.

Birungi was speaking on: Unlocking Capital for Growth and Transformation of Africa’s Manufacturing Sector.

Birungi quoted the World Investment Report 2025, saying between 2020 and 2024, Africa received between $40 billion and $97 billion in annual foreign direct investment.

He added that more than 75% of this investment went into natural resources and large infrastructure projects. Manufacturing received only 12.3%, which limits industrial growth and slows structural transformation.

To make the sector more productive, Birungi is now calling on African governments to devise ways of mobilising resources and targeting the right value chains in manufacturing.

“Unlocking capital for the manufacturing sector requires a shift in how Africa mobilises and allocates investment. Governments, development finance institutions and private investors must channel more resources into industries that add value, create jobs and build export capacity,” Birungi said. 

He also identified Patient Capital as one of the financing options that should be considered by manufacturers because it is affordable, and the repayment period is usually long-term.

Alluding to President Yoweri Museveni’s emphasis on investing in core infrastructure like roads and electricity to unlock manufacturing during the World Bank's International Development Association (IDA) Africa Heads of State summit, Birungi said investing in transportation, among other infrastructural needs, will help manufacturing to grow on the continent.

However, while emphasising the growth of manufacturing, Birungi said there will be a need for a skilled labour force to drive the sector. 

Through the technical and vocational education and training (TVET), Uganda is reviewing its curriculum to align it to the needs of industry, according to TVET Council chairperson Allen Kagina.

Kagina added that Africa’s education pipeline remains misaligned with the labour market. 

For the case of Uganda, she said her council is reviewing the TVET curriculum that will start with re-certifying trainers to improve the quality of skills offered to students.

She also emphasised the importance of discussing skills development in education, adding that focusing on exams alone overshadows practical skills development.

The above suggestions are part of the ongoing discussions by governments, development partners and investors, among others, aimed at making the Industrial sector competitive enough to address some of Africa’s challenges.

The 4th Industrial Week, under the theme: Transforming Africa’s Economy Through Sustainable Industrialisation, Regional Integration and Innovation, also emphasises the importance of women-led manufacturing interventions, youth, among others.

According to trade ministry permanent secretary Lynette B. Bagonza, the theme of the day calls for concerted efforts to remove the bottlenecks that still hold manufacturing back.

She added that this will be possible through policy reforms, public-private partnerships, technology transfer, and investment.