The United Arab Emirates is rapidly expanding its economic and strategic footprint across Africa, driven by significant investments, trade missions, and strategic partnerships. This push aims to secure resources, diversify its economy, and enhance global influence, particularly in critical sectors like renewable energy, infrastructure, and mining.
UAE’s Expanding Influence in Africa
The UAE has emerged as a dominant foreign player in Africa, filling a void left by reduced investments from the United States and, to a lesser extent, China. Since 2019, Emirati firms have announced over $110 billion in deals, primarily in sectors vital for Africa’s development and the UAE’s strategic goals.
- Strategic Investments: The UAE’s focus includes ports, critical mineral mines, and large-scale renewable energy projects. A notable example is the International Holding Company’s (IHC) acquisition of a 51% stake in Zambia’s Mopani Copper Mines for over $1 billion.
- Economic Diversification: The UAE’s drive to diversify its oil-based economy has led to substantial investments in African infrastructure, tourism, agribusiness, and mining. This strategy aims for long-term partnerships rather than short-term resource extraction.
- Rapid Execution: Unlike traditional institutions, the UAE is noted for its ability to deliver high-standard projects quickly, often acquiring stakes in major companies rather than deploying large numbers of its own workers.
Key Investment Areas
Emirati investments are concentrated in areas that align with both Africa’s development needs and the UAE’s strategic interests:
- Infrastructure: The UAE, with its expertise in urban infrastructure development, is helping Africa address its significant infrastructure deficit. DP World, a UAE-based logistics giant, is heavily investing in port facilities across the continent.
- Renewable Energy: With Africa battling climate change and energy access issues, the UAE is a leading investor in renewable energy. Companies like Masdar and AMEA Power are spearheading green electrification projects, with Infinity Power aiming for 10 GW of capacity by 2030.
- Critical Minerals: Beyond renewables, the UAE is interested in resource extraction, particularly critical minerals like copper, cobalt, nickel, graphite, and lithium, essential for its industries.
Concerns and Challenges
Despite the optimism, the UAE’s growing presence in Africa raises several concerns:
- Carbon Credits: Some renewable projects are criticized for focusing on generating carbon credits for offsetting emissions rather than prioritizing local energy needs.
- Illicit Trade: The UAE has been linked to the illicit gold trade from Africa, with reports indicating it is a primary destination for undeclared gold, potentially fueling conflicts like the civil war in Sudan.
- Geopolitical Influence: Critics suggest the UAE’s economic leverage can lead to political and strategic advantages, with some viewing its actions as
Sources
- U.A.E. Is Pouring Money Into Africa, Seeking Resources and Power, The New York Times.
- UAE strengthens its role as Africa’s leading investor {Business Africa}, Africanews.
- UAE’s Africa push prompts cautious optimism, African Business.
- UAE in Africa : Imperial Outpost, Borkena.
