An Exploratory Report on Economic Linkages between the GCC and Africa. Areas covered: - Trade Relations - Investment: Agriculture, Infrastructure, Ports - Private Equity and Venture Capital outlook - Risk Factors

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2. . 2
Introduction
A distinct socio-economic development is under display between the Gulf Cooperation Council (GCC) and
Africa, proving worthy of illustrating, in this writing, the importance of the two regions’ growing economic
ties within an evident command that plentiful opportunities remain to be explored for an improved
structural relationship. This aforementioned dualistic development is characterized, on one hand, by the
growth of Africa’s middle class (estimates by the African Development Bank indicate a total of over 300
million people1
) with a predominantly youthful cohort that bolsters an increasing demand-side consumer
economy, while on the other, by the emergence of young, risk-tolerant and broad-minded business
leaders in the GCC open to explore opportunities beyond their habitual breeding ground. The Economist
Intelligence Unit (EIU) asserts that in both regions, half of the population are under the age of 252
. A
subsequent nexus in trade and investment between the GCC and Africa is consequently natural to
recognize.
While a number of GCC states have durably formed strong ties with African nations, meaningful
investment from the GCC in Africa originated around The Great Recession of 2008-2009, during which
principal areas of focus were food security and infrastructure development. Prime movers were
promoters of agricultural businesses and sovereign wealth funds where investments were solidified on
framework agreements, purchase guarantees, and the provision of credit subsidies. Today, wider sectoral
diversity can be witnessed where businesses in the GCC injected more than $1.2 billion in sub-Saharan
Africa between January 2016 and July 20213
, targeting sectors such as transport and logistics, food and
beverages, financial services, and hospitality. A division of the Financial Times, fDI Intelligence also affirms
that 2016 was a period heightened by the GCC’s investment flow to Africa, as the United Arab Emirates
(UAE) and Saudi Arabia were the second ($11bln) and fifth ($3.8bln) largest investing countries,
respectively, in Africa4
.
A bit of History
Centuries of shared history have shaped Gulf-Africa relations. The geographic proximity between the two
regions emphasizes a long and deep history of cherished cooperation, but also of partisan hostility.
Religious influences must be factored in when framing the early associations. In the 1st millennium BC,
Southern Arabs gained control of the Red Sea trade routes and began to spread the religion of Islam along
the eastern coast of Africa, eventually extending towards the rest of the continent5
. Symbolic milestones
in Arabia-Africa connections within the scaffold of history and spirituality are represented by Moses
confronting the Pharaoh in Egypt, the Kingdom of Kush, in today’s Sudan, appearing in biblical references
as the land ruled by Noah’s grandson, the Islamic ‘hejra’ where the Prophet Muhammad instructed faithful
Muslims to flee persecution by migrating to Ethiopia, and the mystical union of the Jewish Prophet-King
Solomon and the Ethiopian Sheba - a story central to the traditions of the three Abrahamic religions.
1
‘Africa’s Middle Class Triples to more than 310m over Past 30 Years Due to Economic Growth and Rising Job
Culture, Reports AfDB’. https://www.afdb.org/
2
‘Next Generation Africa-GCC Business Ties in a Digital Economy’. The Economist Intelligence Unit.
3
‘Untapped opportunity: Deepening trade and investment between SSA and the GCC’. Economist Impact
4
fDI Intelligence. Referenced from ‘GCC governments spur investment in Africa’. https://african.business/
5
‘The Red Sea to East Africa and the Arabian Sea: 1328 – 1330’. Berkeley ORIAS

3. . 3
Trade relations were epitomized by traditional Arabian vessels known as ‘dhows’ that have regularly
traversed the Red Sea carrying anything from livestock to gold. These merchant linkages have fostered
deep exchanges of religion and culture, paving the way for the formation of a deeply mutual heritage
* * *
Trade Relations
GCC-Africa trade relations are primarily founded on mutual reliance for each side’s staple goods. Oil and
petrochemical products (mainly polymers for plastic manufacturing) are key GCC exports to Africa and
accounted for 24% and 16% of exports respectively from 2016 to 2020, the UAE being the leading source,
followed by Saudi Arabia. Gold and diamonds are prime imports from Africa to GCC, constituting 62% of
the total in the same period. To a lesser extent, the GCC imports copper (8% of total imports from Africa
in the same period) as well as fruits and nuts (4%). While exports from the GCC to Africa were decreasing
by 7% between 2018 and 2019, its imports from the African continent increased by 18% during the same
period. The adverse effects of the Covid-19 pandemic led to a collapse in both exports and imports in
2020, by 5% and 6% respectively, prompted by a drop in demand. The GCC reduced imports of gold and
diamonds from Africa by nearly two-thirds, while exports of oil fell by 27%6
.
Trade Statistics 2016 – 2020 (% of total)
Source: Economist Impact 2021
Although slightly outdated, the following diagram illustrates a pre-Covid outlook of the GCC’s top import
and export countries in Africa in 2015, with minimal variations until the advent of the pandemic in 2020.
6
‘Untapped opportunity: Deepening trade and investment between SSA and the GCC’. Economist Impact

4. . 4
The GCC’s Top Import and Export Countries in Africa, 2015
Source: The Observatory of Economic Complexity, 2015, emerg85.
With its dominant logistics infrastructure base, the UAE has exploited such potential to become the
leading GCC trader with Africa. The country has imported nearly $5 billion of goods from Africa each year
from 2010 to 2015, subsequently increasing these numbers to a whopping $24 billion in 20167
.
Additionally, an estimated $25 billion accounts for UAE’s total non-oil trade with Africa8
, and according to
the UAE’s Ministry of Foreign Trade, the overall trade with six non-Arab African countries alone (Angola,
Kenya, Nigeria, Ethiopia, South Africa and Tanzania) reached over a whopping $8 billion in 2020. As a
percentage of the UAE’s total imports, those from Africa have quadrupled between 2015 and 2020, which
validates Africa’s growing trade significance to the Emirates nation. 9
UAE Trade Balance with Africa, 2007 - 2017
Source: www.CEICDATA.com | International Monetary Fund
7
Todman, Will ‘The Gulf’s scramble for Africa’. Strategic Review by SGPP Indonesia. http://sr.sgpp.ac.id/post/the-
gulfs-scramble-for-africa
8
‘UAE-Africa Trade On The Rise’. https://www.africa-business.com/features/uae-africa-trade.html
9
‘UAE-Africa Trade On The Rise’. https://www.africa-business.com/features/uae-africa-trade.html

5. . 5
UAE Exports to Africa:
Actual 2017 vs. Untapped Potential (in USD millions)
Source: Dubai Chamber, International Trade Center
* * *
Investment
Agriculture
A considerable rise of investment activity in Africa from GCC states began during the global financial crisis
of 08-09, which triggered a global food price crisis and consequentially pressed members of the GCC to
uncover subtle ways of achieving food security. Gulf states deliberated agriculture-led investments in
Central Asia and Latin America but acknowledged that Africa’s wealth of unexploited agricultural lands
could promote auspicious outcomes.
As the proprietor of 60% of the world’s arable land10
with high geographical proximity to the Middle East,
Africa eventually became a partner of interest for the GCC. According to the International Food Policy
10
Plaizier, Wim ‘2 truths about Africa's agriculture’. https://www.weforum.org/agenda/2016/01/how-africa-can-
feed-the-world/

6. . 6
Research Institute, up to 20 million hectares of farmland has been apportioned to foreign buyers in the
last decade, at a value of up to $35 billion, and key GCC states did not hesitate to join the action. Saudi
Arabia is a leading investor in agriculture in Africa, commanding significant investments such as the
purchase of 500,000 hectares of land in Tanzania11
and 124,000 hectares in Ethiopia, followed by the
UAE’s purchase of nearly 100,000 hectares in Ghana12
and 400,000 hectares in Sudan13
. Qatar acquired a
cumulative 100,000 hectares from Sudan14
and 40,000 hectares from Kenya15
.
Large-scale GCC Purchases of Land in Africa for Deals Completed in 2016
Source: GRAIN, 2016, emerg85.io
Infrastructure
Another significance in investment stream from the GCC to Africa is attributed to infrastructure
development, as it mainly relates to energy, telecommunications and ports. GCC companies are currently
contributing around 10% of infrastructure investment in Africa16
.
11
Karam, Souhail. ‘Saudi investors eye leasing Tanzanian farmland’. https://www.reuters.com/article/tanzania-
saudi-farmland-idAFLF5136420090415
12
Allison, Simon & Dana, Joseph. ‘Bridging the Red Sea: How to Build an Africa-GCC Partnership’, emerg85.io
13
Kringen A., John. ‘Gulf Cooperation Council Engagement with Africa’. Institute for Defense Analyses.
14
Allison, Simon & Dana, Joseph. ‘Bridging the Red Sea: How to Build an Africa-GCC Partnership’, emerg85.io
15
Rice, Xan. ‘Qatar looks to grow food in Kenya’. The Guardian.
16
‘GCC Trade and Investment Flows’. The Economist Intelligence Unit.

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The UAE is a principal investor in energy-centric projects in Africa. In 2016, Phanes Group, a UAE solar
energy developer, struck a deal with Nigeria to build three solar plants17
. An Abu Dhabi-based energy
company, called Taqa, began leading operations in West Africa involved in the development of
hydrocarbon resources18
. In 2016, Masdar, a subsidiary of Abu Dhabi’s Mubadala, inaugurated a 16.6MW
PV rural electrification program funded by the governments of Mauritania and Abu Dhabi19
. In the
beginning of 2022, the UAE announced renewed commitments to fund renewable energy projects in
Africa. Dubbed 'Etihad 7', the program aims to provide clean power to 100 million people on the African
continent by 203520
, making the UAE one of the major players in Africa’s clean energy industry.
Africa’s emergent and tech-savvy middle-class, coupled with a continent that boasts of 1.4 billion
inhabitants, are the key drivers behind the growing GCC investment interest in the continent’s vibrant
telecom sector. UAE-based telecommunications company Etisalat has led Gulf investments in mobile
connectivity across Africa. The company operates mobile networks in 11 countries across West and North
Africa21
, and serves over 70 million subscribers on the continent22
. Etisalat has invested $4.5 billion in
international expansion, including $4.1 billion in East Africa and $1.4 billion in West Africa, according to
former Etisalat chairman, Mohammad Hassan Omran. Less than a year ago, Etisalat increased its stake in
Maroc Telecom, a Moroccan telecom operator, in a $505 million deal.
Maritime circulation via Africa’s ports is projected to considerably increase in the next few decades from
300 million tons in 2017 to above 2 billion tons in 204023
. An upsurge in consumer demand and an
improvement of internal infrastructure are behind the anticipated escalation. Albeit vibrant, Africa’s ports
are inadequately equipped to shoulder the expected traffic, and seaside countries are struggling to
enhance capabilities. Such shortfalls uncover opportunities for GCC companies such as Dubai Ports World
(DP World), a longstanding port infrastructure partner to Africa, where it manages eight marine terminals
in five African countries – Egypt, Mozambique, Djibouti, Senegal, and Algeria – and has stevedoring
operations in four ports in South Africa.
In 2016, a $442 million deal with the Republic of Somaliland was announced by DP World to upgrade the
Berbera port24
. In Angola, the Multi-Purpose Terminal (MPT) at the Port of Luanda was handed over to DP
World as it began operating the Terminal in 202125
. More recently, DP World is establishing a $1.1 billion,
1,500-acre deep water port in Ndayane, Senegal (near Dakar)26
. In October 2021, DP World announced a
17
Phanes Group to Build 300MW of Solar PV in Nigeria. https://phanesgroup.com/news/corporate-news/phanes-
group-build-300-mw-solar-pv-nigeria/
18
‘TAQA Strengthens Presence in Africa and India’. https://www.taqa.com/press-releases/2620/
19
‘16.6MW Mauritania Rural Electrification Programme’.
https://masdar.ae//media/corporate/projects/downloads/mauritania-rural-electrification-programme/166-
mauritania.pdf
20
‘UAE launches Etihad 7 programme to fund renewable energy projects in Africa’. https://gulfbusiness.com/uae-
launches-etihad-7-programme-to-fund-renewable-energy-projects-in-africa/
21
Gilbert, Paula. ‘MTN, Etisalat rated top telco brands in Africa and Middle East’
https://www.connectingafrica.com/author.asp?section_id=761&doc_id=758969
22
Mzekandaba, Simnikiwe. ‘Etisalat’s African subscribers reach 71.1 million’.
https://itweb.africa/content/Pero3MZxlEwvQb6m
23
Allison, Simon & Dana, Joseph. ‘Bridging the Red Sea: How to Build an Africa-GCC Partnership’, emerg85.io
24
Maasho, Aaron. ‘DP World launches expansion of port in Somaliland’. Reuters.
25
‘DP World starts operations of multipurpose terminal at Port of Luanda’. DP World, Press Release.
26
‘DP World to build new port in Senegal costing over $1 billion’. Reuters.

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commitment to invest $1 billion in Africa over the next several years27
.
DP World’s Investments and Projects in Africa
Source: DP World
27
Cornwell, Alexander. ‘Dubai's DP World, UK's CDC to invest up to $1.7 bln in Africa’. Reuters.

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As demonstrated on the above section, with bankable positions in all corners of the continent, the UAE is
the dominant investor in Africa among GCC member states and, globally, the fourth-largest investing
country in Africa, second only to China. The Abu Dhabi Fund for Development (ADFD) has played a pivotal
role having financed north of 66 projects in 28 African nations to a value of $16.6 billion to date28
.
The table below illustrates the top 15 investors in Africa as it pertains to the significance of Africa as part
of their global investment strategy, the percentage of Africa in the respective country’s global investments
and also annual average of newly created jobs in Africa between 2010 and 2019. Over this period, the UAE
boasts of a steep investment growth in Africa represented by 24% of its global investments attributed for
the African continent.
Top 15 Investors in Africa (2010 – 2019)
Source: Swiss-African Business Circle, Business Insider Africa
Businesses in the GCC invested more than $1.2 billion in sub-Saharan Africa between January 2016 and
July 2021 alone, targeting sectors such as transport and logistics, food and beverages, financial services,
and hospitality. The largest share of these funds (88%) stemmed from the UAE, followed by 11% from
Saudi Arabia and 1% from Qatar29
. Saudi Arabia is, therefore, the second largest investor in Africa among
GCC states where the Public Investment Fund (PIF), the kingdom’s sovereign wealth fund, had invested
around $4 billion in Africa’s energy, mining, telecom, food and other strategic sectors, whereas the Saudi
28
Yousif, Fatehelrahman. ‘Saudi Arabia, UAE Top Gulf Investments in Horn of Africa’.
https://english.aawsat.com/home/article/3574081/saudi-arabia-uae-top-gulf-investments-horn-africa
29
‘Untapped opportunity: Deepening trade and investment between SSA and the GCC’. Economist Impact

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Development Fund committed $1 billion to finance projects in Africa for the year 2021-2022 in order to
support the continent’s post-pandemic recovery30
.
The Role of the GCC in sub-Saharan Africa’s Key Sectors
Source: Economist Impact
Forward-Looking Interventions
 Beyond Conventional Business
Opportunity prospects in Africa are not limited to traditional industry, and GCC entities have signaled
interest in capturing the host of lucrative possibilities progressive sectors in Africa present. According to
the EIU’s survey of business executives in the GCC and Africa pertaining to sectors bound for growth in
sub-Saharan Africa, financial services, healthcare, agriculture, and retail/e-commerce are areas that
convey sustainable promise.
Sectors Poised for Growth in sub-Saharan Africa
Percentage of executives surveyed expecting revenue to expand in 2022
Source: Economist Intelligence Unit
30
‘Saudi to invest $1 bln to support Africa's post-pandemic recover’. Reuters.

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As previously cited, Africa’s middle-class is on a steady rise (nearly 35% of the total population as of recent
findings31
) and urbanization rates are increasing in all corners of the continent (currently at around 50%
of total population32
), paving the way for an upswing in consumer spending and a conceivable evolution
in consumption trends. As an example, the number of households earning more than $5,000 a year is
expected to grow by 96% between 2015 and 2030 in Lagos, Nigeria (to 6.9 million), by 83% in
Johannesburg, South Africa (to nearly 3.5 million) and by 109% in Abidjan, Côte D’Ivoire (to 2.7 million)33
.
According to the EIU, Nigeria and the East African region will account respectively for 15% and 14% of
growth in consumer spending by 2025. It is evident that rising affluent and middle-class societies project
consumption demands that grow more sophisticated and expensive in nature, hence why many experts
anticipate progressive sectors such as e-commerce, fintech, and energy to present immense opportunities
among the growing pool of financially stable African consumers.
Top Sectors of Interest for Next-Generation Business Leaders in Africa and the GCC
Source: Economist Intelligence Unit
 Private Equity (PE)/Venture Capital (VC) Outlook
Although mounting, mindfulness of opportunities in business linkages between Africa and the GCC
remains constricted. The ordinary tendency for Gulf-based business originators (inclusive of startup
founders) is to expand in regional proximities. Business scaling decisions made by millennial leaders in the
Gulf usually target the Middle East and Asia, before serious considerations are made for an African
expansion, rendering the latter a tertiary destination. This explains the minimal activity of GCC-sponsored
PE and VC investments in Africa, where a diminutive number of funds operate. However, an encouraging
prospect can be observed around investment inflow and outflow dynamics within a timing that can alter
the usual imbalance. Private capital that originated from Europe and North America into Africa over the
past decade is now looking to exit, providing entry opportunities for Gulf investors.
31
‘Africa’s Middle Class Triples to more than 310m over Past 30 Years Due to Economic Growth and Rising Job
Culture, Reports AfDB’. https://www.afdb.org/
32
Data from Statista. ‘Urbanization rate in Africa in 2020, by country.’
33
‘Next Generation Africa-GCC Business Ties in a Digital Economy’. The Economist Intelligence Unit.

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Notable GCC-based PE/VC Activity in Africa
Firm Portfolio Company Sector/Industry Location Year
SPE Capital
Partners
Groupe Outsourcia BPO Morocco 2022
Jedar Capital TopUp Mama Supply Chain Kenya 2022
Gulf Capital Vezeeta Healthcare Egypt/MENA 2020
Nuwa Capital Homzmart Marketplace Egypt 2020
Venture Souq
Yassir Transportation Algeria 2021
Helium e-Health Nigeria 2020
Wallets Fintech Nigeria 2020
Nala Fintech Tanzania 2019
Andela Ed-Tech Across Africa 2016
Bloom Fintech Sudan -
Cowrywise Fintech Nigeria -
Flare e-Health Kenya -
Kippa Fintech Nigeria -
Wamda Capital
GoMyCode Ed-Tech Tunisia 2020
Liwwa Fintech/Microloans Egypt/Jordan 2020
Tabby Fintech MENA 2019
Aqarmap Real Estate Egypt 2018
AZA Fintech Across Africa 2018
Twiga Foods Supply Chain Kenya 2018
DiGame GetSmarter Ed-Tech South Africa 2016
Source: MEA Connect Insights
Other prominent Gulf and MENA-based PE/VC funds and funds of funds with vested interest in African
markets are, among others:

13. . 13
Risk Factors
While opportunities for Gulf-Africa business ties are in abundance, core challenges remain material. We
identify 6 distinct risk factors that business leaders must consider when building economic relationships
between the two regions.

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Conclusion
With the depletion of global oil reserves and the growing volatility of oil prices, it is sensible to assume
that GCC member states will amplify economic ties with the African continent as the latter presents
opportunities that answer to the commercial barebones of the former: food security, infrastructure
linkages, and progressive sectors with fundamentals that are founded on innovation and scale: e-
commerce, fintech, ed-tech, e-health and energy to name the most conspicuous ones.
Not only is Africa endowed with a growingly resilient demand-led consumer economy, it is also producing
some of the world’s most visionary and animated entrepreneurs organized to leverage technology to solve
African problems by “including the excluded”, rather than by “disrupting the incumbent” as it is customary
in the advanced parts of the world. Such a shift in socio-economic paradigm happens to coincide with
entrepreneurial developments in the GCC where a fresh generation of business leaders are looking
beyond their natural habitat to do business. Africa is now a substratum for complex and forward-looking
commercial possibilities, far beyond its prejudiced attributes of being the world’s bulging supplier of raw
commodities.
It is imperative to resolve the asymmetries that distort what could’ve been absorbed as bankable
information and actionable data with potentials to enhance private capital inflow toward the African
continent from the GCC. This report has demonstrated that public capital backed by sovereign wealth
funds and other government-sponsored development funds are predominant vehicles of investment in
Africa by the GCC. There should not, therefore, exist any tangible reason as to why private investors lack
awareness about the strong business propensities that Africa conveys, a quality their government
counterparts have already internalized. Industrious work awaits Africans to deliver a dependably alluring
message to the GCC as to the rest of the world: Africa is ready for business.
Dynamic and communal entities, such as the Dubai Chamber of Commerce and Industry (DCCI), have
promoted and fostered a collaborative progression of ideas, cultural and knowledge exchanges, and
structural support systems; such modes of intervention must be applauded, and more importantly,
further encouraged into expansive continuation. Flagship programs such as the Dubai Startup Hub,
promoted under the DCCI and established to empower entrepreneurship through a multitude of support
avenues, are exemplary projects as they inclusively invite entrepreneurs of the world to join their
community and concretize ideas into impactful businesses – a window of opportunity African
entrepreneurs should capitalize on. The exuberant Expo 2020 in Dubai is worthy of recognition as it has
housed pavilions for African countries, as well as a dedicated stand for the African Union, focused on
cultural exposition, economic opportunities, climate resilience, women empowerment, infrastructure
propensities and much more. Arrangements of such coalescence must be cheered and fortified.
Hence, Gulf-Africa economic ties carry considerable vitality to both regions. The mutual interdependence
is essentially exhibited by a story of, on one side, diversification and high magnitudes of risk tolerance,
while on the other, untapped potential in traditional industry, as well in a knowledge economy, with great
prospects for mutual long-term value creation.

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Disclaimer
The information provided is for informational purposes only and is subject to change without
notice. This report does not constitute, either explicitly or implicitly, any provision of services or
products by MEA Connect Insights, and investors should determine for themselves whether a
particular investment management and/or advisory service is suitable for their needs. Maximum
effort has been exerted to produce objective and fact-based output for the report. Slightly old
data has been used only when recent data appeared difficult to obtain. Historical results are not
indications of future results.
Certain of the statements contained in this presentation may be statements of future expectations
and other forward-looking statements that are based on expert views and assumptions and
involve known and unknown risks and uncertainties that could cause actual results, performance
or events to differ materially from those expressed or implied in such statements. MEA Connect
Insights assumes no obligation to update any forward-looking information contained in this
particular report. Certain information was obtained from sources that we believe to be reliable;
however, we do not guarantee the accuracy or completeness of any information obtained from
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MEA Connect Insights is a market intelligence
platform focused on producing and disseminating in-
depth and actionable data pertaining to economic
highlights and commercial opportunities between the
Middle East and Africa.
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