The Gulf’s search for influence beyond oil now runs through Africa. Sovereign wealth fund the Qatar Investment Authority is investing $500 million in Ivanhoe Mines, a Canadian company that produces copper and other key minerals in Africa. The deal is part of Qatar’s effort to secure the resources needed for the global shift to clean energy, batteries and electric vehicles.
It is one example of a wider pattern. Through their sovereign funds, countries including Saudi Arabia and the UAE are extending their reach into Africa’s renewable energy and mineral sectors, as they seek to diversify their economies and strengthen their influence beyond oil.
The implications are significant: access to clean power is becoming a new source of global leverage as artificial intelligence drives energy demand. China, Europe and the US are competing to control the supply chains behind it.
Gulf investments tie into that race, with these nations looking abroad to broaden their economies, which still depend heavily on income from hydrocarbons.
Among the Gulf powers, Saudi Arabia, especially, is looking to a future where global oil demand is expected to eventually peak, even as estimates suggest that will happen later than expected. By investing in renewables, the kingdom also frees up more oil to export today.
And after investing in large renewable energy projects at home, Gulf funds are now backing similar efforts in African economies.
They make natural economic partners: many African nations have the potential to generate relatively cheap renewable power, given the abundance of sunshine and wind. However, they lack the money and infrastructure to produce and distribute it to their fast growing populations.
By contrast, Gulf economies have plenty of power but rely heavily on oil and gas to generate it. Their search for energy security is therefore leading sovereign wealth funds deeper into Africa’s resource sector. And for good reason: the continent holds large reserves of minerals – such as lithium, cobalt and copper – which are key to the global energy transition.
Access to these rich deposits is becoming even more of a priority, because the growth in use of AI is fuelling a surge in demand for electricity worldwide.
Advantage Africa
Africa may not host the data centres that run AI any time soon, but its vast solar potential and mineral wealth make it essential to producing the clean power and technology on which those systems depend. That is partly why the Gulf, China and Europe are competing to invest there.
These suitors are advantageous for Africa, as many of its countries want to build digital economies but lack the data infrastructure – from data centres to high-speed internet networks – to do so.
Gulf investors are starting to fill that gap. At a recent trade forum in Abu Dhabi, the Emirates signed 18 of the more than 39 deals worth $6.2 billion with Chad, the central African nation. Those include deals in renewable energy and a role for Abu Dhabi Ports to improve Chad’s transport links.
These are not just business ventures but part of a wider effort to turn Gulf capital into influence and build ties with African economies. The strategy is similar to how the Gulf used oil exports to build political and economic ties with the US, plus major oil importers such as China and India. Those exports helped the Gulf secure stronger trade, investment and diplomatic ties.
But as global oil demand moves towards its eventual peak, Gulf states are increasingly investing in renewables and infrastructure – particularly in Africa – in ways that could help them preserve their influence.
The stakes for other economic powers are high. If Gulf investment keeps flowing, the region could shape how Africa builds its energy and mineral infrastructure, shifting influence away from western powers – and increasingly from China – towards the Middle East.
South-south trend
That potential shift comes as the US has increasingly weakened its economic and diplomatic ties with Africa. President Donald Trump's administration has imposed steep tariffs on dozens of African nations and shut down Power Africa – a programme to expand electricity access – as part of wider funding cuts to the US Agency for International Development.
China, though, still plays a key role in Africa through its Belt and Road Initiative, under which infrastructure is financed and built, particularly in developing nations. However, critics of China’s lending model warn it can create a “debt-trap”, where large loans leave poorer countries struggling to repay.
Europe, meanwhile, has responded with its own plan, the Global Gateway, an EU initiative to fund fibre-optic networks, green energy and transport projects. It has already mobilised more than €300 billion ($347 billion) in investment. But the scheme remains smaller in scale and slower in decision-making than China’s, because it is constrained by EU bureaucracy, and high social and environmental standards.
As that unfolds, the Gulf’s role in Africa only continues to grow. It is part of a wider “south-south” trend in which countries in the Global South are working more closely with each other instead of depending mainly on western partners.
Africa’s energy future is being built partly with Gulf money. And that could begin to reshape who holds power in the global economy as the world moves beyond oil.
Carlos Cordon is professor of Strategy and Supply Chain Management at IMD
