The increasing economic engagement of Gulf nations with African nations will not just economically benefit the latter but also provide countries in Africa the alternatives beyond China and the US.
Author
Tridivesh Singh Maini, Assistant Professor, Jindal School of International Affairs, O.P. Jindal Global University, Sonipat, Haryana, India.
Summary
In recent years, Gulf countries have focused not just on resetting their economies and reducing dependence upon oil, but also on significantly reshaping their ties with the rest of the world. Gulf countries have become proactive not just on the issues of the Middle East but also on important global issues. In recent decades, ties between Gulf nations – especially UAE and Saudi Arabia – and Africa have witnessed a significant improvement.
Economic linkages between Gulf countries and Africa
Economic linkages between the Gulf nations and Africa have strengthened in several sectors, with Gulf countries showing interest in mining, energy and infrastructure. Gulf countries have also begun to focus on agri-business opportunities in Africa.
The two Gulf Cooperation Council (GCC) countries which have robust economic ties with Africa are Saudi Arabia and the United Arab Emirates – athough other Gulf countries, like Qatar, also have close economic linkages with Africa. Bilateral trade between Saudi Arabia and Africa was estimated at $45 billion in 2022. Between 2012-2022, UAE committed around $60 billion investment in Africa (in doing so it emerged as the fourth largest investor). In 2022 and 2023, the UAE made investment pledges of over $97 billion in Africa. UAE, which currently holds the Presidency of COP28, announced $4.5 billion in funding for clean energy projects across Africa at the African Climate Summit, Nairobi held in September 2023. What is also important is that the earlier investments were mostly in South Africa, but now the UAE has investments in several African countries. GCC countries, other than Saudi Arabia, have also signed and ratified bilateral investment treaties with Africa.
Published in: TheRise.co.in
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