International development finance institutions (DFIs) have deployed nearly $16.8bn in impact capital across the Southern African region through over 650 deals, according to The Landscape for Impact Investing in Southern Africa report.

Published by the Global Impact Investing Network (GIIN) in partnership with Open Capital Advisors, the report includes findings from 12 countries, as well as a dedicated chapter exploring the role of DFIs across Southern Africa.

According to the findings, South Africa-based DFIs also play a pivotal role and have deployed $17.1bn regionally through over 7,500 deals.

Additionally, several other types of investors—including VC/PE funds, foundations, commercial banks, and pension funds—actively invest in the region, with such non-DFI impact investors having deployed nearly $5.7bn in the region through more than 500 deals.

The report analyzes a market comprising countries that vary substantially in their level of development but that present common challenges and opportunities for investments to have social and environmental impact.

Amit Bouri, CEO of the GIIN, said: “Impact investors are continuing to support these challenging but critical markets, working to demonstrate that investment in the region can drive meaningful social and environmental impact alongside financial returns.”

While trends and opportunities for impact investors vary from country to country, high-potential sectors for the region include agro-processing, energy, and supply chain integration.

Unlike in the rest of sub-Saharan Africa, agriculture is a small contributor to GDP in Southern Africa, yet the sector employs most of the population.

As such, investment in agriculture is seen as important to increasing incomes and food security.

Annie Roberts, Partner at Open Capital Advisors, said: “We increasingly hear that impact investors are looking to deploy capital outside traditional markets in South Africa, and are excited to see so much activity in Zambia, Mozambique, and other countries in the region.”

“Some investors believe that impact investing hasn’t reached Southern Africa yet, but as this report shows, there is a vibrant eco-system with many local players,” she said.

The study was produced with support from the UK Government through the Department for International Development’s Impact Programme and follows three other such studies produced by the GIIN: The Landscape for Impact Investing in South Asia, The Landscape for Impact Investing in East Africa, and The Landscape for Impact Investing in West Africa.