Africa-Middle East Corridor

Deepening political, social, and cultural ties opens a fertile financial market.

Africa’s position as a corridor for capital, trade, and investment is capturing the attention of Middle Eastern banks.

For decades, the continent was a preserve of Western lenders. Today, most have exited due to stringent regulatory requirements in their home markets, leaving Africa’s homegrown banks to fill the void. But the dynamics are changing again as Gulf banks venture into Africa to exploit deepening ties cutting across political, socio-economic, cultural, and religious spheres.

The influx into Africa is striking. In August, Emirates NBD Bank PJSC made a statement of its determination to control the United Arab Emirates-Egypt corridor by acquiring HSBC Egypt’s retail business. Emirates NBD Group CEO Shayne Nelson called the acquisition an important milestone in the execution of the bank’s regional growth strategy. 

“The transaction strengthens our presence and supports our ambition to continue growing our customer franchise,” he said.

Emirates NBD, which boasted $317 billion in assets in 2025, is not the only Middle East bank that is bullish on Africa. First Abu Dhabi Bank PJSC (FAB), the biggest in the Middle East-North Africa region by assets at $382.2 billion with a presence in 20 markets including Egypt and Libya, announced earlier this year that it would open its first sub-Saharan representative office in Lagos, and in July said it would be applying for a banking license in South Africa.

Other lenders are strengthening their footing in Africa through targeted investments and collaborative ventures. Among them is Qatar National Bank QPSC (QNB), which controls a 20.1% stake in Ecobank, the leading pan-African bank with a presence in 35 markets. Ecobank posted a $423 million profit before tax in the first half of this year.

Bahrain’s Al Baraka, the UAE’s Mashreq Bank, and Dubai-based Soren Investment Co., which last year purchased a controlling stake of 42.8% in Kenya’s Gulf African Bank, to are also making forays into the continent.

Tighter Connections

The scramble by Gulf lenders is not a fluke. They see a market awash with opportunities cutting across Islamic banking, international payments, capital flows due to growing trade, foreign direct investment (FDI), and remittances and labor ties.

Bilateral trade between the Middle East and Africa stood most recently at $260 billion, while FDI exceeded $100 billion over the decade from 2012 to 2022. The Gulf Cooperation Council states are also a major source of remittances to Africa. Last year, these amounted to $28.3 billion, dwarfing the $1.1 billion the continent received from the GCC in development assistance.  

Another area of opportunity is Islamic finance, cutting across Shariah-compliant banking, bonds, insurance (Takaful), Islamic fintechs, among other businesses. While Africa is home to 600 million Muslims, its contribution to the global pool of Islamic financial services was just $30.7 billion in 2025, or a mere 0.7% of the global total of $4.4 trillion. Even in Senegal, where 94% of the population is Muslim, Islamic banking assets accounted for a mere 8.3% of total banking assets in 2024.

 “Islamic finance offers a compelling blueprint for strengthening regional financial resilience and economic integration,” said Suleiman Walhad, president of the Horn of Africa States research group.

John Njiraini is a contributing writer based in Kenya.

A customs revamp is a welcome change, but logistics and transit bottlenecks still stifle African trade.

To curb revenue and income losses and accelerate trade across 50 member states, the African Continental Free Trade Area (AfCFTA) Secretariat partnered with Nigeria’s Bergmans Security Consultants and Supplies Ltd. in a $3.1 billion deal to roll out a unified continent-wide customs system.

The project aims to digitize customs processes, streamline cross-border procedures, and provide real-time cargo tracking, with the goal of reducing corruption, revenue leakage, and trade misinvoicing.

The initiative could be “potentially very significant,” Phyllis Wakiaga, a Kenyan lawyer and former Kenya Association of Manufacturers CEO, told Global Finance in an email. “One of the biggest barriers to intra-African trade is the friction businesses face at borders through slow clearance, duplicated documentation, and inconsistent customs procedures.”

Bergmans, based in Abuja, Nigeria, intends to help AfCFTA achieve its goal of doubling intra-African trade by 2035. However, fundamental trading challenges, such as payments, persist across the continent.

AfCFTA did not respond to requests for comment.

Currently, companies often have to route transactions through hard currencies and third-party intermediaries. As a result, high costs will remain even if customs procedures improve, Wakiaga said.

The 2022 launch of the Pan-African Payments and Settlement System (PAPSS) could potentially unlock the anticipated benefits of AfCFTA, she added. However, rollout is slow. As of 2025, the network only connects 19 countries so far (the African Union has 55 member states).

Logistics Creates Another Headache

Jacqueléne Coetzer, founder and CEO of a pan-African business advisory and trade firm, described to Global Finance just how convoluted transporting cargo across the continent by land, sea, and air can be. Goods, she said, are frequently routed through South Africa, Europe, or the Middle East—adding significant transit time and cost.

Furthermore, political will remains inconsistent, as individual governments often resort to protectionist measures and informal barriers to shield domestic industries.

Ultimately, while modernizing customs creates an essential foundation, Coetzer said that it’s not a complete solution. Without parallel investments in logistics, payment systems, standardized regulations, and physical infrastructure, a streamlined customs framework will fall short.

“A perfectly digitized customs declaration does not help much if the truck cannot cross the border efficiently because the road is inadequate, or if the cargo then spends days waiting for space at a congested port,” she said.

AfCFTA took effect in January 2021, aiming to counter global isolationism through cross-border cooperation. Since then, the picture has shifted somewhat. Africa’s population has grown to roughly 1.6 billion people as of 2026. That’s up from 1.2 billion when the agreement was first signed.

On intra-African trade, the AfCFTA-era numbers show real but modest progress. Intra-African trade hit about $220.3 billion in 2024 and roughly $213.8 billion in 2025. African Export–Import Bank, or Afreximbank, projects it will reach $230 billion in 2026.

But, as Coetzer explained, getting customs right is only part of the challenge. If logistics, payments, infrastructure, standards, production capacity, and political implementation remain unresolved, it will simply create a faster system for moving goods through borders that still cannot move enough goods efficiently.

“The real objective should therefore be much more ambitious,” she added. “AfCFTA needs to build an integrated continental trading system, not simply a continental customs system.”

Anthony Noto covers corporate finance and private credit. Contact him at anoto@gfmag.com

John Njiraini and Charles Wachira contributed to this report.

Investors step in to close Africa’s critical $80B infrastructure financing gap.

Gulf investors are rapidly reshaping Africa’s investment landscape, committing billions of dollars to ports, transport corridors, logistics, renewable energy, and critical minerals as governments across the continent seek new sources of long-term development finance.

The shift gathered momentum in June, when sovereign wealth funds (SWFs), commercial banks, development finance institutions, institutional investors, and corporate issuers launched the Africa–Middle East Corridor. Debuted during the Global Banking & Markets Middle East 2026 conference in Dubai, the initiative aims to mobilize capital for infrastructure, deepen Africa’s debt capital markets, and expand cross-border investment between the Gulf and Africa.

The launch comes at a critical moment for the continent. According to the African Development Bank (AfDB), Africa requires approximately $170 billion annually to finance infrastructure, yet current investment totals only $80 billion to $90 billion, leaving an annual financing gap approaching $80 billion.

The Gulf is positioning itself to help close the deficit.

Investors from Gulf Cooperation Council (GCC) countries announced 73 foreign direct investment (FDI) projects worth more than $53 billion across Africa in 2023, reflecting a decisive shift toward fewer but significantly larger investments concentrated in renewable energy, logistics, critical minerals, transport and digital infrastructure.

China Cuts Back

The changing investment landscape also reflects a broader shift in global capital flows.

For nearly two decades, Chinese policy banks financed much of Africa’s modern infrastructure expansion, underwriting railways, highways, ports, airports and power projects across the continent. Yet, according to the Boston University Global Development Policy Center, Chinese policy bank lending fell from a peak of $28.8 billion in 2016 to $2.1 billion in 2024. Annual lending regularly exceeded $10 billion between 2012 and 2018, but Beijing has increasingly pivoted from sovereign-backed megaprojects to smaller, commercially driven investments.

That retreat has created space for Gulf SWFs, export credit agencies, and commercial banks to expand their presence across Africa.

The United Arab Emirates has emerged as Africa’s fourth-largest foreign investor. Between 2019 and 2023, Emirati investments exceeded $110 billion, including an estimated $70 billion directed at renewable energy.

Several flagship transactions illustrate the scale of that commitment. ADQ’s $35 billion Ras El-Hekma development in Egypt ranks among the largest FDI deals ever concluded on the continent. DP World now operates six African ports and logistics facilities, while Abu Dhabi Ports has secured concessions in Egypt, Angola, and the Republic of Congo, strengthening Gulf influence over strategic maritime trade routes linking Africa with Europe, Asia, and the Middle East.

Renewable energy has become a major pillar of Gulf investment in Africa.

Masdar, Abu Dhabi’s state-owned renewable energy company, has committed $10 billion to develop 10 gigawatts (GW) of renewable energy capacity across sub-Saharan Africa by 2030. Infinity Power, a joint venture between Masdar and Egypt’s Infinity, is now Africa’s largest pure-play renewable energy company, operating 1.3GW of generation capacity in Egypt, South Africa, and Senegal, with a further 16GW under development. Saudi Arabia’s ACWA Power, one of the Middle East’s largest private power developers, continues to expand its renewable energy portfolio in Morocco, Egypt, and South Africa, while Gulf investors are increasingly financing green hydrogen, battery storage, and electricity transmission projects across the continent.

Gulf Capital Steps In

Commercial banks, too, are increasing their African presence.

In March, First Abu Dhabi Bank announced plans to establish its first representative office in Lagos, making Nigeria its West African hub. The lender has already participated in financing the $1.13 billion Lagos – Calabar Coastal Highway, signaling growing Gulf interest in African project finance and structured lending.

“Gulf capital is increasingly vital to Africa because of a strategic alignment of economic needs,” says Phumlani Majozi, senior economist and executive director at the African Markets Institute. “As traditional Western and Chinese funding slows, African countries require enormous investment for infrastructure, energy, and digital transformation, while Gulf states are actively diversifying beyond hydrocarbons. The relationship is evolving from aid-based engagement into long-term commercial integration.”

The trend represents a structural shift rather than a temporary investment cycle, Majozi says, driven by long-term economic diversification strategies such as Saudi Vision 2030 and the UAE’s ambition to become a global investment and logistics hub.

Private-sector advisers see the relationship as rooted in geography and commercial history.

“The Middle East is Africa’s closest neighbor. Trade between the two regions stretches back thousands of years,” said Jacqueléne Coetzer, founder and CEO of Jacqueléne Global Consulting. “Africa and the Gulf do not need to discover entirely new markets; they need to rediscover one another.”

Gulf investors are targeting critical minerals in the Democratic Republic of Congo and Zambia, agriculture in Ethiopia, renewable energy in Kenya and South Africa, logistics in Egypt and Nigeria, and financial services through Mauritius, Coetzer says.

Africa’s bargaining position is also strengthening.

The African Continental Free Trade Area (AfCFTA) is creating a $3.4 trillion integrated market spanning 54 economies. The continent controls roughly 30% of the world’s critical minerals, including copper, cobalt, lithium, and manganese — resources central to the global energy transition.

Individual countries are strengthening their ties across the regions as well. Kenya’s Comprehensive Economic Partnership Agreement (CEPA) with the UAE, signed in January 2025, was the first such agreement between the UAE and a mainland African country. The accord improves business access to both countries’ markets by expanding investment protection and providing a framework for deeper cooperation in trade, logistics, financial services and digital commerce.

“Africa’s leverage has never been stronger,” Majozi argues. “The continent possesses roughly 30% of the world’s critical minerals, the world’s youngest workforce and the AfCFTA’s $3.4 trillion integrated market. The challenge is converting that structural advantage into negotiating power.”

If the Africa–Middle East Corridor succeeds in converting investment commitments into bankable projects, it could become one of the principal channels through which Gulf capital finances Africa’s next generation of infrastructure, industrialization, and capital-market development.

Charles Wachira is a contributing writer based in Kenya.