The New ‘Scramble’: UAE vs. Saudi Investment in East Africa

• Ports, minerals, trade deals and billions in development finance: an in-depth analysis on UAE vs Saudi Arabia in East Africa. Who’s winning the race?

For decades, the competition for influence in East Africa was a two-player game. On one side stood China, with its infrastructure-for-resources model and big ticket loans. On the other stood the West, with its development conditionality and multi-lateral lenders. Today, the board has new players, and they are not waiting their turn.

The United Arab Emirates (UAE) and the Kingdom of Saudi Arabia are engaged in an intensifying competition for economic primacy across East Africa, deploying sovereign wealth, strategic port acquisitions, and a new generation of bilateral trade pacts that are rapidly redrawing the region’s commercial map.

Since 2022, Gulf states have announced over $175 billion in clean energy investments alone across Africa, but the real story lies beneath these headline figures: a race between Abu Dhabi and Riyadh to lock up trade corridors, critical mineral supply chains, and strategic assets from the Red Sea to the Indian Ocean ports.

This is not the 19th century scramble for territory, but something arguably more consequential for East Africa’s development trajectory: a contest between two Gulf visions of economic partnership, with very different implications for the region’s industrialisation ambitions.

Why East Africa Now?

To understand why East Africa has become the fulcrum of Gulf competition, one must first understand the structural shifts underway in the Arabian Peninsula. Both the UAE and Saudi Arabia are racing to diversify beyond hydrocarbons before the energy transition renders their primary asset obsolete. East Africa offers three things the Gulf needs urgently: food security, critical minerals, and control of global trade chokepoints.

UAE Investment Africa 2026 figures tell part of the story. The Emirates has invested over $110 billion in new African projects between 2019 and 2023, with a heavy concentration in East African logistics and ports. Its trade with the continent reached approximately $107 billion in 2024, making it one of Africa’s top five commercial partners. But these numbers mask a deeper strategic logic.

“The UAE prioritizes securing and optimizing ports, airports, shipping lanes, and logistics hubs that link Africa to global markets,” writes Seade Caesar, Executive Director of the Africa Global Policy and Advisory Institute. “By investing in corridor infrastructure, the UAE reduces supply-chain risk, shortens delivery times, and positions itself as an indispensable transit and re-export gateway for African trade”.

Saudi Arabia’s approach, while equally ambitious, follows a different playbook. Where the UAE builds ports and logistics networks, Riyadh builds mines and processing capacity. The Kingdom’s Vision 2030 industrialisation push has transformed minerals from a domestic policy priority into an outward-looking procurement strategy. State-backed vehicles like Manara, a partnership between sovereign wealth and mining interests, are explicitly designed to position Saudi Arabia as both investor in foreign resources and developer of downstream facilities.

Ports vs. Minerals: Divergent Gulf Strategies

The contrast between UAE and Saudi approaches is nowhere more visible than in their respective East African portfolios. The UAE, through Dubai’s DP World and Abu Dhabi’s AD Ports Group, has pursued a strategy of port dominance.

DP World’s $442 million investment in Somaliland’s Berbera port remains on track despite regional political tensions, while AD Ports has been expanding its footprint in Tanzania and exploring opportunities across the continent.

Saudi Arabia, by contrast, has focused on resource extraction and processing. The Kingdom’s sovereign wealth fund is investing billions in mining companies and offering incentives for investors willing to set up processing operations, including simplified licensing procedures and access to energy at scale.

In January 2026, Northern Graphite signed an agreement with Saudi conglomerate Obeikan Group for a $200 million battery anode materials plant in Saudi Arabia, supplied by the Okanjande graphite mine in Namibia.

These divergent approaches reflect deeper structural differences. The UAE, with its established logistics expertise and global port network, sees East Africa as an extension of its trading empire. Saudi Arabia, with its vast territory and energy resources, sees the region as a feedstock supplier for domestic industrialisation.

Table 1: UAE vs. Saudi Investment Footprint in East Africa

 The Numbers Game: Comparing Deal Values

The scale of Gulf engagement becomes clear when comparing total deal values across key East African economies. Drawing on Saudi Fund for Development announcements, UAE sovereign wealth commitments, and bilateral trade data, a hierarchy of Gulf investment destinations emerges.

Table II: Total Gulf Investment & Deal Values in Select East African Economies (2022-2026)

The data reveals a striking pattern: the UAE’s commitments are larger in headline terms but concentrated in fewer countries (Kenya, Somaliland, DRC), while Saudi’s funding is more widely distributed across smaller economies (Burundi, Malawi, Mozambique) through development loans. This reflects the UAE’s commercial-first approach versus Saudi’s development-assistance model.

The CEPA Offensive: UAE’s Trade Diplomacy Machine

The UAE’s most potent weapon in the East African competition is its Comprehensive Economic Partnership Agreement (CEPA) program. Unlike traditional trade deals focused on tariff reduction, CEPAs are designed as instruments of economic diplomacy that lock in long-term investment pathways across logistics, agriculture, aviation, clean energy, and services.

“CEPAs include tariff liberalisation, but their main value lies in services trade, investment protection, business mobility, and regulatory cooperation,” writes Caesar. For the UAE, they serve three interconnected goals: diversifying away from hydrocarbons by guaranteeing access to food and raw materials; lowering regulatory barriers for UAE firms in logistics, finance, and digital services; and reinforcing its role as a global trade hub.

Kenya represents the UAE’s flagship East African CEPA. Signed in January 2025 and now progressing through ratification, the agreement positions Nairobi as a regional logistics and aviation gateway into wider East African markets. For the UAE, deeper integration with Kenya strengthens trade corridors that run through ports, air cargo, and re-export pathways linked to the Emirati hub economy.

Rwanda is next. Advanced CEPA talks are underway with Kigali, reflecting the UAE’s interest in countries that occupy strategic positions within Africa’s political economy. Rwanda’s strong governance, services economy, and regional integration make it an attractive platform for Gulf services firms seeking East African market access.

Saudi Arabia, notably, has no comparable trade agreement program. While Riyadh has signed memoranda of understanding and project-specific deals, it lacks the UAE’s sophisticated trade diplomacy machinery. This gives Abu Dhabi a structural advantage in locking in preferential access before Saudi competitors can establish a foothold.

Critical Minerals: The New Investment Frontier

Nowhere is Gulf competition more intense than in critical minerals. As the energy transition drives demand for copper, cobalt, lithium and graphite, East Africa’s mineral wealth has become a strategic prize.

The UAE has moved aggressively through Abu Dhabi’s International Resources Holding (IRH), which has been active in copper and tin deals across Zambia and the Democratic Republic of Congo in 2024-2025. These transactions include offtake and trading components, showing Gulf capital is willing to take operational stakes in sometimes challenging jurisdictions to secure supply.

Saudi Arabia is pursuing a parallel track through Manara, the joint venture between sovereign wealth fund PIF and state miner Ma’aden. In late 2024, Manara was reported to be in advanced talks over a stake in a Zambian copper operation. The Kingdom is also targeting graphite, with the Obeikan Group agreement for a Namibian-linked processing plant representing a $200 million bet on downstream capacity.

The graphite deals are particularly instructive. Both NextSource Materials (operating in Madagascar) and Northern Graphite (Namibia) considered African processing locations, Mauritius and Namibia respectively, before shifting focus to the Gulf. NextSource cited simplified permitting, strong infrastructure, and US tariff advantages as reasons for preferring UAE/Saudi locations over African alternatives.

This creates what Nafi Quarshie, Africa director at the Natural Resource Governance Institute, calls “tension” with African ambitions. Namibia banned unprocessed critical mineral exports in 2023 specifically to develop local processing capacity. Tanzania has adopted a similar approach. Yet Gulf incentives, low energy costs, favourable financing, trade advantages, are drawing processing investment away from the continent.

“Saudi Arabia is an attractive location for our BAM plant due to its low energy and labor costs, close proximity to Namibia, strong government support, favorable financing conditions, and trade advantages that include low tariffs into the US and efficient access to European markets,” said Hugues Jacquemin, CEO of Northern Graphite.

For East African governments, the dilemma is acute. Gulf capital can restart idled mines and bring new investment, the Okanjande project in Namibia, on hold since 2018, could resume if the Saudi deal proceeds. But the processing jobs and value addition will occur in the Gulf, not Africa.

Development Finance: Saudi’s Soft Power Advantage

While the UAE dominates headlines with ports and CEPAs, Saudi Arabia has quietly built a formidable development finance presence. The Saudi Fund for Development (SFD) has financed over 400 projects worth $10.7 billion in 46 African countries, 57 per cent of its global funding.

In January 2026, SFD signed 14 new development loan agreements worth over $580 million with 12 African ministers. The East African footprint is substantial:

• Rwanda: $20 million for water system expansion in eastern Kigali
• Tanzania: $13 million for the Benaco to Kyaka transmission line
• Burundi: $50 million for King Khalid University Hospital rehabilitation
• Malawi: $20 million for Mangochi-Makanjira Road construction
• Mozambique: $150 million across five hospitals, Muera Dam, and National Road No. 1 upgrades

These are not commercial investments but development loans, carrying softer terms and addressing UN Sustainable Development Goals. They build goodwill and government relationships in ways that commercial port deals cannot.

The UAE’s development footprint, through the Abu Dhabi Fund for Development, is smaller and more concentrated. While ADFD has financed projects across Africa, it lacks the scale and geographic reach of SFD’s operations. This represents a strategic vulnerability for the UAE: ports and CEPAs engage governments at the trade ministry level, but development loans reach health, education, and water ministries, building relationships across the entire government apparatus.

Read also: UAE’s Masdar to develop 150MW solar plant in Angola to power 90,000 homes

UAE investment Africa 2026: The $133 Billion Clean Energy Opportunity

The clean energy transition represents the largest single investment opportunity in East Africa, with the continent requiring an estimated $133 billion annually by 2030 to meet development and climate objectives. Gulf states are positioning themselves as the primary financiers of this transition as Western development finance recedes.

A new report by Clean Air Task Force shows over $175 billion in Gulf-backed clean energy commitments across Africa since 2010, with most announcements coming after 2022. The UAE, through Masdar and Infinity Power, currently manages 1.3GW of operational clean energy across Egypt, South Africa, and Senegal, with a massive 13.8GW development pipeline. In Angola, Masdar recently signed a PPA for the 150MW Quipungo solar project.

Saudi Arabia’s ACWA Power has similarly scaled up investments, particularly in large-scale renewable and hydrogen projects in Egypt, South Africa, and Morocco. East Africa, with its geothermal potential in Kenya, hydropower in Ethiopia, and solar across the region, could be the next frontier.

But the CATF report warns that current investment patterns risk reinforcing existing inequalities. “Most capital continues to flow to a small group of relatively well capitalised countries, while nations with the greatest energy access gaps remain underserved,” said Nada Hamade, a co-author.

David Yellen, CATF’s director of climate policy innovation, noted that Gulf investors are demonstrating “an alternative investment model focused on partnership and market creation, rather than debt-heavy lending”.

The cost of capital remains a major obstacle. African energy projects face an average cost of capital of 15.6 percent, more than three times higher than in developed markets. Gulf capital, with longer-term risk horizons and willingness to invest in enabling infrastructure, could help close this gap. But only if it reaches the countries that need it most.

The African Response: Agency or Acquiescence?

How should East African governments navigate this new Gulf competition? The risks are clear: being reduced to raw material suppliers for Gulf processing hubs; seeing logistics corridors controlled by foreign port operators; and accepting development finance that locks in commodity dependence.

But the opportunities are equally real. Gulf capital is patient, willing to take risks Western financiers avoid, and increasingly structured as direct project investment rather than sovereign loans, reducing pressure on public debt. The question is whether African governments can leverage competition between the UAE and Saudi Arabia to secure better terms.

“There is an opportunity to diversify both the geographic and structural composition of their investments,” Hamade noted. East African countries with clear regulatory frameworks, bankable projects, and unified negotiating positions can extract greater local processing requirements, technology transfer, and employment guarantees.

Rwanda offers a model. By positioning itself as a services hub with strong governance, Kigali has attracted both UAE CEPA talks and Saudi development finance. It is leveraging Gulf interest to build digital infrastructure and water systems while maintaining policy autonomy.

Kenya’s approach is more commercial. The CEPA with UAE opens markets for Kenyan exports while attracting Gulf investment into agriculture and digital infrastructure. But Nairobi must ensure that “trade-plus-investment” partnerships deliver jobs and industrialisation, not just import-export platforms.

The alternative is visible in the graphite negotiations. African processing ambitions are being undercut by Gulf incentives, with mines supplying raw materials to Saudi and UAE plants. As one industry executive told this correspondent: “We wanted to process in Africa. But the Gulf offered lower costs, faster permitting, and better trade access. It wasn’t a difficult business decision.”

That is the challenge for East African policymakers: making the business case for local processing compelling enough to compete with Gulf incentives. Without coordinated regional action, harmonised local content requirements, shared infrastructure investments, and common negotiating positions, the continent risks exporting raw materials to the Gulf and importing finished products, repeating the colonial extractive model with new patrons.

Read also: Port Pay Off: DP World’s Cash Injection Delivers Wins for Tanzania’s Shipping Industry

The Geopolitical Dimension: America, China, and the Gulf Triangle

The UAE-Saudi competition in East Africa does not occur in a vacuum. Both Gulf states are navigating complex relationships with Washington and Beijing while pursuing their regional ambitions.

The US has historically been a security partner for Gulf states but a declining development financier for Africa. The Trump administration’s 2026 approach to trade, exemplified by the truncated AGOA renewal, signals that Washington expects reciprocity and market access, not aid-based relationships. This creates space for Gulf states to position themselves as non-conditional partners, even as they pursue their own strategic objectives.

China remains Africa’s largest trade partner, with two-way trade near $296 billion in 2024. But Chinese lending approvals to Africa rose to only $4.61 billion in 2023, the first increase in seven years, suggesting Beijing is becoming more selective. Gulf capital is filling gaps Chinese lenders once dominated.

“The consortium model” is emerging as a distinctive feature of the 2026 investment cycle, according to Fabio Scala, a strategic consultant specialising in frontier markets. “Gulf capital buys platforms and control points; Asian capital brings scale, supply chains and execution”. In practice, this means UAE-anchored equity with Chinese or Indian engineering, procurement, and construction (EPC) capacity, a hybrid model that combines Gulf financial muscle with Asian industrial heft.

For East African governments, this complexity requires sophisticated negotiation skills. Gulf investors are not monolithic; UAE and Saudi interests diverge, and both are willing to compete for strategic assets. African policymakers can exploit this competition, but only if they have clear industrial strategies, bankable projects, and the technical capacity to structure complex, multi-party transactions.

By the end of 2026, the contours of Gulf influence in East Africa will be substantially clearer. The UAE’s CEPA network will likely include Kenya (implemented), Rwanda (signed), and potentially Ethiopia or Uganda in advanced talks. Saudi development finance will continue flowing to smaller economies, building goodwill and government relationships that may translate into future commercial access.

The critical minerals landscape will be reshaped. If the Northern Graphite/Obeikan and NextSource/UAE plants proceed, Gulf states will have established themselves as intermediate processing hubs between African mines and Western battery manufacturers, capturing value-add that might otherwise have occurred in Africa.

Ports and logistics will remain UAE territory. DP World’s Berbera investment and AD Ports’ Tanzanian expansion will lock up Indian Ocean trade corridors, while Saudi Arabia focuses on its own Red Sea ports rather than competing for African facilities.

The $133 billion clean energy question will determine whether Gulf capital becomes Africa’s primary development financier or remains concentrated in a few well-capitalised countries. East Africa’s vast energy access gap, 600 million people without reliable electricity, represents both a moral imperative and a commercial opportunity. Whether Gulf investors seize it, and on what terms, will define the region’s development trajectory for decades.

For East African leaders, the message from 2026 is simple: the new scramble is here, the players are at the gate, and the terms of engagement are being written now. The question is not whether to engage Gulf capital, but how to do so on terms that deliver lasting industrialisation, not just another chapter in the long history of resource extraction.

Our analysis draws heavily on official data from the Saudi Fund for Development, UAE government announcements, company disclosures from DP World, AD Ports, Masdar, ACWA Power, Northern Graphite and NextSource Materials. Additionally, our analysis incorporates reports from the Clean Air Task Force, Finance for Development Lab, Africa Global Policy and Advisory Institute, and Natural Resource Governance Institute.

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