Abidjan, Ivory Coast – Morocco has ranked first in Africa’s industrialisation index for the first time, overtaking South Africa, which had held the top position since 2010, according to a new report by the African Development Bank (AfDB).

The bank’s 2025 Africa Industrialisation Index ranked Morocco at 0.8415 points, narrowly ahead of South Africa’s 0.8396 points, reflecting what the AfDB described as sustained industrial upgrading, export diversification and the effective implementation of strategic industrial policies.

South Africa remains one of the continent’s leading industrial economies, the report said, but has experienced a gradual long-term decline in industrial competitiveness. Its score fell from 0.8819 points in 2010 to 0.8396 points in 2024.

The index measures industrialisation across three main dimensions: industrial performance; direct drivers such as investment, infrastructure, education and access to finance; and indirect factors, including the business environment, the rule of law, public debt and inflation.

Arab nations dominate rankings

Egypt ranked third in Africa with a score of 0.7827, followed by Tunisia at 0.7760. Algeria placed sixth with 0.6661, meaning four Arab countries featured among the continent’s top six industrial economies.

The report described Morocco, South Africa, Egypt and Tunisia as Africa’s leading industrial quartet, maintaining a significant lead over most other economies on the continent. Mauritius ranked fifth, followed by Algeria, Eswatini, Senegal, Namibia and Ivory Coast to complete the top 10.

North Africa remained the continent’s most industrialised region in 2024 with a score of 0.6891, ahead of Southern Africa at 0.5850. Central, West and East Africa followed.

Most North African countries scored above the continental average, except Libya and Mauritania, which fell into the medium and lower-middle industrialisation categories, respectively.

Uneven industrial progress

Despite Morocco’s rise and improvements recorded by many countries, the report said industrialisation across Africa continues to advance slowly and unevenly.

Forty-one of the continent’s 54 countries improved their scores between 2010 and 2024, but only 24 improved their rankings, while five countries remained in the same positions.

The continental average industrialisation score rose from 0.5134 in 2010 to 0.5445 in 2024, an increase of 6 percent. The average country score rose by 6.4 percent during the same period.

Africa’s manufacturing value added (MVA) increased from $285bn in 2020 to $351bn in 2025. However, the continent still accounts for less than 2 percent of global manufacturing output and only 1.4 percent of global manufactured exports.

MVA per capita in Africa reached $226.7 in 2025, remaining below the 2014 peak of $254.9.

Weak regional integration

The report linked weak industrial growth in Africa to fragmented markets and limited regional integration.

Intra-African trade accounted for just 14.4 percent of the continent’s total trade between 2022 and 2024, compared with 60 percent in Asia and 57 percent in Europe.

According to the AfDB, the challenge extends beyond tariffs to include non-tariff barriers, weak infrastructure, differing technical and regulatory standards, and underdeveloped regional value chains, all of which limit the ability of African firms to scale production across borders.

The bank said the African Continental Free Trade Area (AfCFTA) could become a major driver of regional industrialisation if the continent shifts from “integration for trade” to “integration for production” by linking infrastructure, industrial policy, investment and regional value chains.

The AfDB estimates that effective implementation of the AfCFTA could increase African incomes by about 7 percent by 2035 and generate up to $450bn in additional value.

Intra-African trade is also projected to rise by 60 percent in agricultural and food products, 48 percent in manufacturing and 34 percent in services by 2045.