The United Arab Emirates (UAE) has become the largest investor in new businesses in Africa, raising hopes of a promising future for emerging technologies on the continent.
Between 2019 and 2023, Emirati companies invested £88 billion in the continent, with the vast majority of these coming in renewable energy.
The figure is more than double the investment made by more traditional investors such as the UK, France and China who have all scaled back investment following a series of project which failed to produce the expected returns, according to the Financial Times.
African countries had hoped for around £1 trillion to be pledged to fight climate change on the continent at the recent COP conference but were left disappointed when that figure ended up being around £270 million.
But whilst the investment promises a bright future for the continents green energy sectors, there are fears that the Emirati’s poor history with regards to workers’ rights could see African workers exploited.
Ahmed Aboudouh is an associate fellow at the Chatham House thinktank who believes that Emirati investment comes with risk.
He said: “African countries are in dire need of this money [for] their own energy transitions. And they plug huge holes, the Emirati investors, that the west failed to.
“But at the same time they come in with less attention to labour rights, to environmental standards.”
Ken Opalo, an associate professor at Georgetown University agrees: “African countries need all the financing and trade they can get, however, there is also the opportunity for the attention to breed criminality – like we are seeing in the gold sector.”
The UAE has long been a big player in North Africa and the Horn of Africa where it has been accused of fuelling conflicts in countries such as Libya and Sudan.
But its expansion deeper into the continent is seen as an attempt to diversify its economy from oil and gas and open up now markets such as copper and lithium, both crucial to the production of electric vehicles.
Aside from green initiatives, UAE companies have also invested in areas such as telecoms and agriculture with the Dubai royal Sheikh Ahmed Dalmook al-Maktoum recently agreeing a deal which will see him sell carbon credits from forests covering a fifth of Zimbabwe, 10% of Liberia, 10% of Zambia and 8% of Tanzania.
Other investments have seen the Gulf state purchase significant holdings in many of the continent’s mining conglomerates.
