Why Africa’s Tourism Deals Outperformed Europe in 2025

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The global travel and tourism sector navigated a noticeable deceleration in deal-making throughout 2025. Total transactions, spanning mergers and acquisitions (M&A), private equity, and venture capital, fell 5% year over year. 

Travel News Africa reports that GlobalData notes that this dip reflects a broader trend of investor caution fuelled by persistent economic volatility and a fundamental shift in how capital is deployed across the industry.

However, the slowdown was not universal, as regional performance varied widely. While the Asia-Pacific region recorded a modest 4% decline, Europe felt the chill more acutely with a 17% drop, mainly due to ongoing geopolitical and economic strain. 

Conversely, North America defied the global slump, posting an 8% increase in deal volume, sparked by a flurry of activity in the U.S. and Canadian markets. Meanwhile, investment in the Middle East, Africa, and Central America remained remarkably steady, signalling that these regions were holding their ground as resilient pockets of opportunity.

A closer look at specific countries reveals a fragmented market. While the North American giants grew, traditional powerhouses such as India, China, Spain, and Germany saw their deal numbers decline. 

In contrast, the UK, Japan, and Australia maintained a steady pace, mirroring their 2024 performance. This patchwork of growth and decline suggests that, while global headwinds are real, localised sweet spots continue to attract investors who are willing to adapt to regional nuances.

The nature of the deals themselves also transformed. M&A activity proved to be the industry’s bedrock, remaining stable year over year. This stability indicates that established players are still hungry for strategic consolidations to bolster their market positions. 

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Conversely, the high-risk segment experienced a significant decline: venture financing and private equity deals fell by 21% and 28%, respectively. This shift highlights a new era of safe-bet investing, where capital is funnelled toward proven business models rather than speculative, early-stage startups.

These figures serve as a crucial reminder for industry professionals throughout Africa. The relative stability of deal volume in the Middle East and Africa suggests the continent remains a viable destination for capital, particularly where local fundamentals are robust. 

However, the sharp decline in venture funding means that African travel-tech and tourism startups must now present ironclad value propositions to win over a more risk-averse global investment community.

As dealmakers grapple with inflation and shifting travel habits, the path forward lies in identifying localised growth levers. For African stakeholders, the strategy is clear: double down on operational resilience, innovative products, and strategic partnerships. 

Ultimately, 2025 was not a year of retreat for travel and tourism but one of refinement, rewarding those who can leverage local strengths to build sustainable, long-term growth.

In Nigeria, the topic of tourism investment presents a dichotomy. On one hand, the government and private sector are aggressively pushing to diversify the economy beyond oil, with tourism receipts projected to hit $12 billion by late 2026. On the other hand, the spate of investment activity is currently hampered by high inflation and security concerns that are prompting international venture capitalists to pause.

While global venture capital (VC) is drying up, Nigeria is seeing a rise in domestic M&A. Local hospitality groups are acquiring smaller boutique hotels to create safe havens for domestic travellers and “bleisure” (business+leisure) seekers in cities like Lagos, Abuja, and Port Harcourt.

As Europe’s deal volume tanks by 17%, Africa’s stability makes it an attractive alternative for investors seeking emerging-market growth without the extreme volatility seen in some Western markets.

As VC funding for apps is down, the focus has shifted toward hard assets. In Nigeria, this means more investment in physical infrastructure, luxury resorts, and eco-lodges rather than just travel technology platforms.

 Stability in the Middle East and Africa (MEA) region encourages greater trans-African partnerships. We are seeing more “intra-Africa” travel deals, reducing the reliance on European or American capital.

For Nigeria, the global slowdown acts as a filter. Only the most secure and well-managed projects are being funded, which could lead to higher-quality tourism offerings in the long run.

Want more insights on global tourism? Keep tabs on Rex Clarke Adventures for the latest articles on the latest strides in the African continent!

FAQs

1. Why did travel deals decrease globally in 2025?

Economic uncertainty, inflation, and high interest rates made investors more cautious, particularly regarding high-risk venture capital and private equity.

2. How did Africa perform compared to Europe in tourism investment?

Africa remained stable, whereas Europe saw a sharp 17% decline in deal activity due to geopolitical pressures and economic cooling.

3. Is Nigeria a safe place for tourism investment in 2026?

While security remains a challenge, the potential for high returns in “bleisure” and luxury travel has kept domestic and regional M&A activity active.

4. What is “bleisure”, and why is it essential for Nigeria?

“Bleisure” combines business and leisure travel. In Nigeria, it’s a significant trend, as business travellers in Lagos and Abuja extend their stays to explore local cultures and resorts.

5. Which type of travel deals are currently most successful?

Mergers and acquisitions (M&A) are currently the most stable because companies prioritise strategic growth and consolidation over early startup investments.