The Port of Bosaso, Somalia. Photo by Siphon, Wikipedia Commons.
October 5, 2026
By Dr. Suleiman Walhad
Key Takeaways:
The essay says Gulf port, mine, and energy pledges in Africa can recycle value from informal gold leaving Sudan, Congo, Somalia, and Ethiopia into Gulf refining and back as “investment,” with Sudan’s war gold the sharpest case.
Somalia port deals with regional authorities, Ethiopia as a Red Sea pressure point, and a Gulf stake in Zambia’s Mopani copper are cited as commerce that also buys routes and political access; Mogadishu has objected to subnational contracts.
The author does not call all Gulf capital predatory, but warns states need terms that build capacity rather than blend financier, trader, operator, and patron.
Official announcements routinely feature billion-dollar commitments to ports, renewable energy, logistics and mining, presenting Gulf capital as a catalyst for economies that have long struggled to attract investment.
The reality is more complicated. Behind the headline figures lies a system in which trade, resource extraction, sovereign investment and geopolitical influence increasingly reinforce one another. The question is not simply how much Gulf capital is entering Africa, but where it comes from, who captures the resulting value and what African states concede in return.
Gold provides the clearest illustration.
Across conflict-affected and poorly governed parts of Africa, including Sudan, the Democratic Republic of Congo, Somalia, and Ethiopia, large quantities of gold leave the formal economy through smuggling and informal trading networks. Much of it ultimately reaches Gulf markets, where sophisticated trading and refining infrastructure can transform opaque supplies into internationally tradable bullion.
The economic significance is considerable. Gold provides liquidity in countries where conventional financial systems are weak, currencies are under pressure and state institutions have limited reach. But the same networks can also allow armed groups, politically connected intermediaries and foreign buyers to profit while governments lose tax revenue and oversight.
This creates a striking asymmetry. African states can lose control of valuable natural resources at the point of extraction, while Gulf-based traders and investors capture value further along the chain. The resulting capital can then be redeployed in Africa as investment, in ports, mines, logistics networks or infrastructure, giving the appearance of a straightforward flow of foreign capital when the underlying relationship is considerably more circular.
Sudan offers the most troubling example.
The country’s war has devastated the formal economy, but its gold trade has proved remarkably resilient. Gold has become an important source of financing for rival power centres and an object of intense competition among domestic and foreign actors. Gulf commercial interests have consequently attracted scrutiny over their role in Sudan’s gold trade and their broader relationships with the country’s competing political and military factions.
The distinction between commerce and geopolitics becomes difficult to sustain in such an environment. A port concession, mining investment or commodity purchase can generate not only commercial returns but also strategic access, political relationships and influence over critical infrastructure.
The same logic is visible around the Horn of Africa States.
Somalia’s fragmented political structure has created opportunities for Gulf states and companies to cultivate relationships with regional authorities as well as the federal government in Mogadishu. Port agreements and commercial arrangements some of the Somali states have given Gulf actors access to strategically important positions along some of the world’s most valuable maritime routes.
For Gulf investors, this can make commercial sense. The Red Sea, Gulf of Aden and western Indian Ocean are critical arteries linking Asian manufacturing with European markets. Control or influence over ports is, therefore, about more than cranes, containers and concession fees. It can provide strategic leverage over trade routes that have become increasingly important to global commerce.
For Somalia, however, the arrangements carry a political cost. Mogadishu has repeatedly objected when foreign governments or companies negotiate directly with subnational authorities, arguing that such agreements undermine the sovereignty of the federal government. The dispute is not merely constitutional. Every external relationship that strengthens a regional administration can alter the balance of power within an already fragile state.
That is why the language of investment can be misleading. A port concession may simultaneously be a commercial transaction, a geopolitical foothold and a mechanism for reshaping the political economy of the country in which it is located.
Ethiopia adds another dimension to the Gulf’s strategy in the Horn. Its position between Sudan and Somalia gives Gulf investors a strategic pressure point across the region, while close ties with Addis Ababa provide several Gulf states with political and logistical reach far beyond Ethiopia’s borders. Gulf capital therefore does more than finance Ethiopian infrastructure and commerce: it embeds Gulf interests in the strategic geography linking the Red Sea, Sudan and Somalia, turning investment into an instrument of regional influence.
Mining presents another version of the same tension.
In Zambia, the acquisition of a controlling interest in Mopani Copper Mines by a Gulf business partner was presented as an important new chapter for one of the country’s most significant copper assets. The investment was intended to support a substantial increase in production and capital expenditure.
Butt the subsequent performance has highlighted the gap that can emerge between the ambitions attached to major Gulf-backed investments and their execution. Production targets, financing commitments and contractual obligations have become matters of public dispute, underscoring a familiar problem in African resource deals: headline investment figures are easier to announce than to translate into sustained production, employment and fiscal revenues.
None of this means that Gulf investment in Africa is inherently predatory, nor that every project is simply a mechanism for resource extraction. Gulf capital can provide something Africa badly needs such as large pools of financing, infrastructure expertise, trading networks and the ability to execute projects at a scale that many Western investors have been unwilling or unable to match.
But it does mean that the traditional distinction between foreign investment and resource extraction is becoming increasingly blurred.
The Gulf states are not merely investors seeking financial returns. They are sovereign actors pursuing strategic interests through commercially structured vehicles. Ports provide access to maritime corridors. Mining assets secure supplies of strategically important commodities. Agricultural investments can strengthen food-security positions. Commodity trading creates relationships with governments and politically influential intermediaries. And sovereign wealth can provide the financial capacity to sustain these strategies over decades rather than electoral cycles.
Africa, meanwhile, is negotiating from a position of considerable need. Governments require capital for infrastructure, energy and industrialisation, while many face high borrowing costs and limited access to Western finance. Gulf investors can therefore offer an attractive alternative, but one that can come with long concessions, preferential access to resources and political relationships that are difficult to unwind.
The central issue, then, is not whether Gulf money is technically “new” or “old”. Capital is fungible, making it virtually impossible to follow individual dollars from an African mine into a sovereign wealth fund and back into an infrastructure project. Yet that does not make the underlying connection meaningless: ownership, trade flows and political influence can still form a continuous economic chain.
The more important question is who controls the value chain.
If gold leaves Africa through opaque channels, is refined and traded in Gulf markets, and the resulting financial power is later deployed to secure African mines, ports or logistics assets, the relationship cannot be understood simply as foreign direct investment flowing into a capital-starved continent. It is a vertically integrated system of commerce and influence, in which control over commodities, finance and infrastructure increasingly sits in the same hands.
That is the strategic wager behind the Gulf’s expanding presence in Africa.
The brochures may describe a partnership for development. The more consequential story is about who controls the ports through which commodities move, the mines from which they originate, the financial networks through which they are monetised and the political relationships that protect them.
For African governments, the challenge is not to reject Gulf capital. It is to negotiate with it from a position strong enough to ensure that investment produces productive capacity rather than merely changing the ownership of extraction.
The danger is not that the Gulf will invest too much in Africa.
It is that Africa will become increasingly dependent on a form of investment in which the distinction between financier, trader, infrastructure operator and geopolitical patron becomes impossible to see.
About Dr. Suleiman Walhad
Dr. Suleiman Walhad writes on the Horn of Africa economies and politics. He can be reached at suleimanwalhad@yahoo.com.
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