Morocco has overtaken South Africa to top the African Development Bank's Africa Industrialization Index for 2025, ending South Africa's 15-year run as the continent's leading industrial economy. The AfDB, which unveiled the report at its annual meeting in Brazzaville, credited Morocco's continued industrial policy, export diversification and manufacturing growth in the automotive, aerospace and infrastructure sectors.
The rest of the top 10 include Egypt, Tunisia, Mauritius, Algeria, Eswatini, Senegal, Namibia and Côte d'Ivoire. The index assessed industrial growth in 54 African countries between 2010 and 2024 and found that 41 improved their industrialization scores, with Africa's overall industrial performance increasing by 6%. Northern and Southern Africa continue to dominate manufacturing output and export sophistication, while intra-African trade remains a structural weakness at only 14.4% of total trade.
Morocco's rise is the result of two decades of policy implementation. The automotive sector – now the country's largest export industry – is expected to produce 493,004 passenger cars in 2025, surpassing South Africa's 329,600 units. Automotive exports to the EU to reach €15.1 billion in 2023. The aerospace sector, home to more than 150 companies including Boeing, Airbus, Safran and Thales, is expected to generate exports worth $2.87 billion in 2024, up from $839 million a decade ago. Investments in infrastructure – the Tanger Med port, the Al Borak high-speed rail line and the Nador West Med complex – have strengthened Morocco's position as a manufacturing and logistics hub linking Europe, Africa and the Middle East.
The decline of South Africa centers on the collapse of the two-state monopoly. Frequent outages at power utility Eskom have forced producers to resort to costly self-generation, while breakdowns in Transnet's rail network have forced freight traffic on roads and caused port bottlenecks in Durban and Cape Town. GDP has grown an average of less than 1% annually over the past decade, and gross fixed capital formation has declined in 3 out of 4 quarters through 2024. President Ramaphosa has estimated that the country needs ₹1.6 trillion ($99 billion) in public infrastructure investment and ₹3.2 trillion from the private sector to meet 2030 infrastructure targets.
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AfDB said Africa's industrial future depends on reliable energy, strong infrastructure, technical skills, financing and deeper regional integration under the African Continental Free Trade Area. “The continent's real deficit is no longer the absence of industrial strategies,” said Harouna Kaboré, who contributed to the report. “What is still lacking is rigor in implementation.”
key takeaways
The Morocco-South Africa ranking reversal is a story of both the rise of one country and the institutional failure of the other. Morocco's industrial strategy, based on royal commitment since the early 2000s, has been unusually coherent by African standards – surviving government changes, external shocks and COVID disruption – because it is insulated from electoral cycles in a way that democratic South Africa's policy framework is not. The result is a manufacturing base that has complicated over two decades: from automotive zero to nearly 1 million units a year, from a cottage industry to aerospace to a $2.87 billion export sector, and phosphate-derived chemicals that feed global fertilizer markets. In contrast, South Africa has seen Eskom's debt – now worth more than 400 billion rand – act as a fiscal anchor that underpins the infrastructure spending needed to keep heavy industry competitive, while Transnet's decline has added a logistics tax on every producer in the country. The AfDB report concludes that intra-African trade accounts for only 14.4% of total trade, underscoring a systemic problem that neither Morocco's success nor South Africa's decline will solve: African manufacturers still export primarily to Europe and Asia, sell commodities rather than finished goods, and operate in supply chains that bypass neighboring countries entirely. The AfCFTA, now in its implementation phase, is the structural mechanism designed to change this – but its traction depends on the same energy, logistics and institutional capacity that the Index identifies as Africa's main industrial deficits.