From 2019 to 2023, Emirati companies announced projects worth $110 billion. Of this, $72 billion was invested in the renewable energy sector.
read more
The United Arab Emirates has become the largest supporter of new business projects in Africa, raising hopes for an influx of capital on the continent. However, increased investment from the UAE has also raised concerns that the influx of capital could undermine worker rights and environmental protections.
From 2019 to 2023, Emirati companies announced projects worth $110 billion. According to the Financial Times, $72 billion of that was invested in renewable energy. It is noteworthy that this pledge was more than double the amount pledged by British, French and Chinese companies.
In the past, these three countries were powerhouses when it came to investing in infrastructure projects. However, there were also many unsuccessful attempts to achieve the expected benefits. Not only this, but African leaders were also disappointed by the climate finance promises made by Western governments. At the COP29 summit in Azerbaijan, rich countries pledged $300 billion a year, while developing countries asked for $1.3 trillion.
African leaders welcome growing interest
African leaders have welcomed the increased interest from the Emirates. But some activists and analysts across the continent argue that the UAE’s poor track record on labor rights for migrant workers, continued support for hydrocarbons, and failure to tackle environmental issues is a hallmark of investment in Africa. They have expressed concern that this may happen.
“African countries desperately need this funding for their energy transitions, and Emirati investors are filling the gaping hole that the West has failed to fill,” says think tank Chatham House. said Ahmed Abdou, Associate Fellow. “But at the same time, they come without much concern for labor rights or environmental standards,” he added.
The UAE has long played a major political role in North Africa and the Horn of Africa. The Emirates has been accused of inciting conflict in Libya and Sudan. UAE leaders are now seeking to diversify the economy away from oil and gas, including into green energy and “critical minerals” such as copper needed for electric cars and batteries.
Dubai’s ports and airlines were early entrants to Africa. Dubai’s Emirates Airlines flies to 20 African countries. Meanwhile, DP World, which is managed by the Dubai Royal Family, has been operating in the region since 2006. The company manages six ports and has plans to build two more. Abu Dhabi Ports has been managing Guinea’s Kamsar Port since 2013 and has recently acquired concessions in Egypt, the Republic of Congo and Angola.
“At the moment Angola is the only country that has both DP World and the Port of Abu Dhabi,” Maddalena Procopio, a senior policy researcher at the European Council on Foreign Relations, told the Financial Times. He insisted that the UAE has not left East Africa. “This is linked to the UAE’s growing interest in expanding connectivity to the Americas, especially Latin America,” she added.
UAE companies are also investing in agriculture and telecommunications sectors. From 2022, Dubai Royal Sheikh Ahmed Dalmook Al-Maktoum has a deal to sell carbon credits from forests covering one-fifth of Zimbabwe, 10 percent of Liberia, 10 percent of Zambia and 8 percent of Tanzania. tied.
Emirati investment is also penetrating the mining industry. However, there are also drawbacks. The amount of gold illegally smuggled into Dubai from Africa has increased in recent years. However, African countries remain optimistic about investment. “African countries need all the credit and trade they can get,” said Ken Oparo, an associate professor at Georgetown University. “But there are also opportunities for attention to create crime, as we have seen in the gold sector,” he added.
Information provided by the agency.
