By Pazani Vaitilingon, Chief Commercial Officer, Africa, India and Middle East
From being labelled the “Hopeless Continent” in 2000 to “Africa Rising” in 2013 by The Economist, Africa’s economic narrative has evolved dramatically. Today the continent is recognised for its immense potential, driven by abundant natural resources, a youthful population, and expanding digital and trade opportunities.
According to the United Nations Environment Programme (UNEP), Africa holds 65% of the world’s arable land, 40% of its gold, and 30% of global mineral reserves, including the largest deposits of cobalt, diamonds, platinum and uranium. With a population expected to reach 1.5 billion in 2025, and over 60% under the age of 25, Africa presents a compelling case for investment. Foreign investment surged by 75% to US$97 billion in 2024, with US$22 billion attributed to impact-specific investments.
The rise of impact investments in Africa
Impact investments – those generating measurable social and environmental impact alongside a financial return – are gaining global traction. The Global Impact Investing Network (GIIN) estimates the market at US$1.571 trillion in assets under management (AUM) as of October 2024, reflecting a 21% compound annual growth rate since 2019. McKinsey reports returns between 8% to 12% over the past five years, with 75% of impact investors achieving both financial and social outcomes.
In Africa, impact investments are addressing developmental challenges while unlocking growth. According to the UNDP Africa Investment Insights Report 2025, key sectors include:
- Renewable energy: Millions lack reliable electricity. Investments in solar and wind energy, particularly in Kenya, Morocco and South Africa, have mobilised over US$25 billion in private capital. 85% of impact funds target clean energy
- Climate resilience: Burkina Faso, Senegal and Ivory Coast are among the most climate-vulnerable nations. Investments in climate-smart agriculture, flood mitigation and water technologies are helping communities adapt
- Healthcare:With 70-90% of medicines imported, impact investments in infrastructure and medical technology are improving access and outcomes
- Education: Digital platforms are helping 100 million out-of-school children access learning. Investments in schools and teacher training are empowering future generations
- Agriculture:Though 60% of Africa’s workforce is employed in agriculture, it receives less than 10% of total investment. Impact capital is modernising farming, improving food security and raising incomes
Mauritius as a springboard for impact
Located in the Indian Ocean, Mauritius serves as a vital bridge between Asia and Africa. Its robust infrastructure and financial ecosystem make it an ideal launchpad for impact-driven investments. The Mauritius International Financial Centre (MIFC) offers a stable, transparent and tax-efficient platform for cross-border capital flows.
With over 450 private equity funds domiciled in the MIFC, Mauritius has become a preferred jurisdiction for development finance institutions (DFIs) and impact investors. According to the Capital Economics Report 2021, Mauritius structured over US$82 billion in African investments, accounting for 9% of total FDI into Africa. These investments created approximately 4.2 million jobs and generated US$6 million in annual tax revenue for African governments.
Mauritius has also implemented several ESG and impact-focused initiatives:
- Mandatory ESG reporting for listed companies since 2019
- Launch of the SEM Sustainability Index (SEMSI) in 2015
- Regulatory frameworks for corporate and green bonds, updated in 2022
- A dedicated ESG Board for trading green bonds, climate bonds and ESG equities
- Disclosure and Reporting Guidelines for ESG Funds, effective March 2025, to combat greenwashing and promote transparency
These measures position Mauritius as a regional leader in sustainable finance and impact investing, aligning with global ESG standards and supporting climate transition across Africa.
The future of impact investments in Africa
The outlook for impact investing in Africa is promising. Technological innovations, such as mobile banking and digital health, are expanding access and efficiency. As global awareness of the United Nations’ Sustainable Development Goals (SDGs) grows, more capital is expected to flow into impactful projects.
Mauritius and Singapore are emerging as key domiciles for Africa- and Asia-focused impact funds, complementing traditional hubs like the U.S. and various European jurisdictions. As the global economy stabilises, investments in renewable energy, affordable housing, and healthcare are poised to accelerate.
Regulatory scrutiny is increasing, with global standards like the EU’s Sustainable Finance Disclosure Regulation (SFDR) influencing local frameworks. Mauritius’ recent ESG fund guidelines align with these standards, promoting accountability and third-party verification.
Africa’s diversity demands region-specific impact metrics. Investors are collaborating with governments, NGOs and communities to develop relevant standards. According to the Gitnux Report 2025, artificial intelligence integration in impact measurement tools rose by 60% in 2023, improving data accuracy. Over 80% of impact funds now use digital platforms for reporting and stakeholder engagement.
Following COP29’s emphasis on climate finance, private sector participation in cleantech, renewable energy and decarbonisation is expected to grow significantly.
Impact investing in action: The IQ-EQ difference
At IQ-EQ Mauritius, we proudly support African impact-focused clients in their transformative journeys. As a trusted partner to fund managers, DFIs and institutional investors, we provide the infrastructure and expertise to support the full lifecycle of impact-focused funds.
Over 87% of the funds we administer are aligned with impact mandates targeting the continent. Our role goes beyond administration. We enable the efficient flow, governance and measurement of capital committed to solving Africa’s most pressing challenges.
Examples include:
- A client delivering clean electricity to 180,000 households in Sub-Saharan Africa, reducing carbon emissions by an estimated 573,000 tonnes annually
- Another client has developed one of Africa’s largest wind farms, generating 159MW of clean energy and offsetting over six million tonnes of CO₂. This project provides reliable electricity to more than two million people
- In the DE&I space, a client’s education programme helped 66% of girls complete primary and secondary education, surpassing the 61% completion rate for boys. The same client advanced gender equity in the workplace, with women comprising 56% of the workforce and receiving 48% of promotions
These examples reflect our commitment to supporting clients who are not only delivering financial returns but also transforming lives and communities across Africa.
Partner with IQ-EQ for African impact investment success
Impact investments are key to unlocking Africa’s potential and addressing its most pressing challenges. By aligning financial returns with social and environmental outcomes, they offer a powerful tool for sustainable development. Mauritius, with its strategic location and supportive ecosystem, will continue to play a pivotal role in this journey.
As the African proverb goes, “If you want to go fast, go alone; if you want to go far, go together.” Through collaboration and shared purpose, we can achieve African-led, future-fit development, where no one is left behind.
As the demand for sustainable finance grows, IQ-EQ Mauritius stands ready to guide and empower investors who are shaping Africa’s future, responsibly, inclusively and sustainably.
Ready to explore impact investment opportunities in Africa? Our experienced team is here to help you navigate this dynamic landscape and structure solutions that deliver both financial returns and meaningful impact.
Contact our team today to discuss your African impact investment strategy.
*Article originally published in The Directory of Financial Institutions print magazine*
