East Africa’s fixed asset spending and broader capital formation

Fixed assets sit inside a broader investment measure

Gross fixed capital formation tracks acquisitions less disposals of fixed assets, including construction and equipment. Gross capital formation also incorporates changes in inventories and may include valuables. A fall in stocks can pull the broader measure below the fixed component. Source 3 Source 4

The difference can run either way

In 2025 Rwanda’s gross capital formation share was 34.13% and its fixed share was 32.19%. Uganda’s were 22.65% and 21.86%. Tanzania and Kenya show the broader figure below the fixed share. The gap is calculated from the published aggregates. Source 1 Source 2

The shares describe investment relative to output

Tanzania’s fixed share was 31.87% in 2015 and 42.22% in 2025. Kenya’s fixed share moved from 22.09% to 17.92%. Each year uses its own GDP denominator. The change describes investment’s weight in the national accounts. Source 2 Source 4

Financing flows answer a different question

Foreign direct investment records a financing relationship between investors and enterprises. Gross capital formation measures acquisitions and inventory changes. A project can be financed from domestic or foreign sources and still add to the same national-accounts total. Source 5 Source 3

Sources

• WDI national accounts, gross capital formation as a share of GDP
• WDI national accounts, gross fixed capital formation as a share of GDP
• World Bank, definition of gross capital formation
• World Bank, definition of gross fixed capital formation
• World Bank Data Help Desk, asset formation and foreign investment