The City of Durban has secured FDI amounting to R15.2billion over the past six years, from 2019 to 2024. Throughout this period, the city has seen a mix of highs and lows in FDI. This report will analyze the performance of foreign direct investment, identify the most attractive sectors, and examine the countries from which these investments originate. Additionally, it will assess the economic impact of the FDI on Durban’s economy, to understand the global investment sentiment toward the city's economic activity
Since 2024, Durban has reported only one FDI in March from the Mediterranean Shipping Company (MSC), amounting to R134.99 million. This is significantly lower compared to the same period last year when the city attracted FDI worth R927.6 million. In 2023, FDI levels plummeted to R1,308.50million, a dramatic 76% drop from the previous year, with key projects including Toyota South Africa's renewable energy initiative worth R714.38million, Netzsch Southern Africa at R326.74 million, and Future Life at R60.29million.
However, in 2022, Durban experienced an increase in the inflow of investments, reaching an impressive R5,424.22 million—a staggering106% increase from the previous year. This boom was driven by significant projects such as Volvo Trucks South Africa, which accounted for R1,922.10million, Blue Projects at R426.45 million, and Rhenus Logistics at R355.89 million. Despite the ups and downs, these five years show that Durban can attract a lot of foreign investment, which is good for its economy. The fluctuations highlight the need for a stable environment to keep attracting investors and sustaining growth
Figure 1: Foreign Direct Investment (fdi) Trend in Durban
Sources: FDI Market Intelligence, 2024
Between2019 and 2024, Durban experienced a diverse landscape of foreign direct investment across various sectors. The Automotive original equipment manufacturer(OEM) sector emerged as the frontrunner, attracting a remarkable R14,272million, signaling a robust interest in automotive manufacturing. Following closely, the Communications sector secured R11,386 million, highlighting major investments in telecommunications. The Food and Beverages sector, with R4,384million, and the Coal, Oil, and Gas sector, with R4,142 million, also saw substantial investments, emphasizing the city's strong activity in food production and energy resources. Business Services and Transportation and Warehousing sectors followed, with R3,749 million and R3,552 million, underscoring the importance of logistics and professional services.
Mid-tier sectors like Paper, Printing, and Packaging (R2,717 million), Chemicals (R2,313million), and Metals (R2,026 million) showcased a diverse industrial base. Investments in Hotels and Tourism (R2,031 million) and Building Materials(R1,887 million) reflected steady interest in construction and hospitality. Specialized sectors such as Rubber (R1,621 million) and Biotechnology (R1,364 million)attracted focused investments, highlighting the potential in manufacturing and life sciences. Emerging sectors, including Automotive Components (R1,166million), Financial Services (R1,132 million), and Plastics (R1,102 million),showed growth. Notably, Renewable Energy received R1,021 million, indicating future promise in sustainable energy
Sources: FDI Market Intelligence, 2024
The United Kingdom led the way with R14,840 million, followed closely by Japan withR13,777 million. The United States and Mauritius also made substantial contributions, investing R7,045 million and R7,029 million, respectively. India invested R5,428 million, and other investors included Germany with R2,768million, Sweden with R2,028 million, Portugal with R1,891 million, and Switzerland with R1,686 million.
Additionally, the UAE (R1,534 million), Ireland (R798 million), and Hong Kong (R690 million)played key roles in Durban's economic development. Other notable contributions came from the Netherlands (R526 million), Romania (R426 million), and Luxembourg (R425 million), reflecting the city's wide-ranging global appeal. Smaller yet still significant investments were made by Austria (R291 million),Australia (R236 million), Taiwan (R235 million), and Canada (R207 million). These investments highlight sustained international interest and strong potential economic partnerships.
Over the past six years, Durban has experienced a transformative wave of FDI, adding R10.1 billion to the city's GDP and accounting for 2.2% of its annual GDP. The substantial investment injection has positively impacted several key sectors, each contributing uniquely to the city's growth story The manufacturing sector led with R2,476 million, followed by financial and business services at R1,911 million. Trade and accommodation contributed R1,740 million, transport and communication added R1,581 million, and construction saw R1,394 million. Other sectors combined for an additionalR1,025 million.
The inflow of international investments has contributed significantly to employment in Durban, creating and sustaining 8,653jobs, representing 0.7% of the annual employment. These opportunities are spread across various skill levels, with 2,456 skilled jobs, 3,371 semi-skilled jobs, and 2,825 unskilled jobs. Key sectors driving this employment growth include manufacturing, transport and communication, agriculture, and trade and accommodation.
The inflow of investment has not only boosted GDP and job creation but also enhanced the quality of life form any residents in Durban as it has added R3,975 million to household income, accounting for 1.5% of household expenditure
In 2024, Durban has seen a slow pace of foreign investment, with only one announced in the past seven months, according to FDI Market Intelligence research. This trend is also confirmed by other sluggish investment indicators, such as the Q1 Business Confidence Index, which has remained below 50%, and the Q1 Gross Fixed Capital Formation decline. Despite these challenges, foreign direct investment remains vital to the city's economic growth and development. It will be important to monitor FDI trends following the national and provincial elections, as the Q2 Business Confidence Index has shown significant improvement, suggesting potential positive outcomes post-election.
1. FDI Market Intelligence 2024: https://app.fdimarkets.com/index.cfm?fuseaction=trends.default
2. S&P Global Market Intelligence, economic indicators, 2024:https://www.marketplace.spglobal.com
3. Easy Data by Quantec, 2024; Regional Service Standardised Regional Household Income & Expenditure- https://www.easydata.co.za/dataset/RIES/
4. Statistics South Africa, Quarterly Labour Force Survey, 2024: https://www.statssa.gov.za/?page_id=1854&PPN=P0211&SCH=73892
5. Easy Data by Quantec, 2024; Regional Service Standardised Regional Output & GVA at basic prices-https://www.easydata.co.za/dataset/RIES/
6. Conningarth Economists & Development Bank of South Africa, 2009; Social Accounting Matrix (SAM) for eThekwini, Manual Second Draft Final Report
7. Durban Chamber of Commerce and Industry, UKZN, Macro Economic Research Unit, eThekwini Municipality, produced Durban Business Confidence Index (BCI), 1st Quarter 2024 Report.
Produced by The Durban EDGE Team of the
Policy, Strategy, Innovation, and Research Department of
The Economic Development Unit of eThekwini Municipality
For more information, contact edge@durban.gov.za
Ref: Siphesihle.Thusi@durban.gov.za
Economic Research Advisor
Economic Information and Research
