Africa-GCC Trade Reaches $121 Billion in 2023, with Rising Investments and Opportunities
According to a report published by Afreximbank on December 16, 2024, trade exchanges between Africa and the Gulf Cooperation Council (GCC) member states, including Saudi Arabia, Oman, Kuwait, Bahrain, the United Arab Emirates, and Qatar, reached approximately $121 billion in 2023. The report, titled "Rising Gulf investments in Africa: Unlocking opportunities and navigating challenges," highlights that bilateral trade between Africa and these oil-rich monarchies has more than doubled since 2016, when it stood at $57.7 billion.
African exports to GCC countries have increased from $28.3 billion in 2016 to $69.4 billion in 2023, while African imports from these countries have reached $51.5 billion in 2023, up from $29.4 billion in 2016. The main commercial partners of the GCC on the continent include Egypt, South Africa, Nigeria, Kenya, Morocco, Sudan, and Eritrea.
The report also sheds light on the surge in direct investments from GCC countries in Africa, aimed at reducing their dependence on hydrocarbons. Between 2012 and 2022, direct investments from the six monarchies in Africa exceeded $100 billion, with the United Arab Emirates leading the way with $59.4 billion, followed by Saudi Arabia ($25.6 billion) and Qatar ($7.2 billion).
In 2023, 73 foreign direct investment (FDI) projects worth over $53 billion were announced by GCC countries. These projects, often backed by sovereign funds like the Public Investment Fund (Saudi Arabia) or Mubadala (UAE), primarily target high-yield sectors such as real estate and export-oriented agriculture.
In parallel, GCC countries provided approximately $9.2 billion in official development assistance (ODA) to Africa in 2022, representing 14% of the total external financing received by the continent that year.
Finally, according to Afreximbank, this dynamic is driven by the conviction that Africa will play a key role in global growth over the next few decades, thanks to its vast natural resources, the emergence of its middle classes, and its rapid demographic growth. By 2050, the continent's cumulative nominal GDP could reach $14 trillion, supported by an average annual growth rate of 4-5%, while the African population is expected to double to 2.4 billion, offering a vast market and immense opportunities.
