The African Union (AU) has called on Arab countries to revitalize their investment and trade commitments across the African continent.
This appeal aligns with the Nigerian government’s ongoing efforts to attract foreign investments from the United Arab Emirates (UAE) and Saudi Arabia.
The Chairperson of the African Union Commission, Mr. Moussa Faki, made this call during the 33rd session of the Arab Summit in Bahrain, which concluded on May 16, 2024.
AU Seek Arab Investments
The summit, which gathered key stakeholders from various Arabian countries, emphasized the importance of strengthening economic ties between Africa and the Arab world.
In his address, Mr. Faki highlighted the significant role that Arab countries can play in advancing joint Arab-African initiatives and realizing the mutual priorities and ambitions of both regions.
He emphasized the historical context of the Africa-Arab partnership, which was first ratified in 1977 to serve as a framework for economic collaboration between the two regions. Currently, nine African states, including Egypt and Morocco, are part of the Arab League.
Mr. Faki’s call for increased Arab investment comes at a time when Africa is seeking more economic opportunities to boost its development.
The Middle East and North Africa (MENA) regions are some of the wealthiest in the world regarding natural resources, holding over 60 percent of the world’s proven oil reserves, according to a World Bank report. The report also notes that oil accounts for about 85 percent of the merchandise exports from the Arabian region.
The AU Chairperson acknowledged the efforts of various financial institutions, including the Islamic Development Bank, the Arab African Development Bank, and the Arab Finance and Development Funds, in supporting development across Africa over the past five decades. These collaborations have significantly contributed to the continent’s progress in various sectors.
Despite these efforts, Mr. Faki pointed out that the current level of Arab investment in Africa does not fully reflect the potential and depth of the relationship between the two regions.
He stressed the need for Arab countries to enhance their economic investments in Africa to achieve more substantial and impactful development outcomes.
He stated,
“I have repeatedly expressed Africa’s desire to revitalize this partnership for the good of the peoples and countries of the two regions. I have always unequivocally stated that our partnership, in its current state, does not rise to the level of those historical relations and various dimensions.
“We are all required to have better cohesion to avoid imbalance and advance our partnership around our shared priorities in investment, infrastructure, economic integration, trade, environment, food sufficiency, modern technologies, and to boost solidarity in international forums around our common issues and concerns.”
Strategic relations at global level
Bahrain King, Hamad bin Isa Al Khalifa, who presided over the summit, read out the Bahrain Declaration approved by the League of Arab States at the summit.
The declaration showed that Arab states pledged to strategic economic relations with Africa at the global level.
“Recognising the strategic importance of the Arab nation at the global level, its economic potential and human resources, and the need to create conditions for enhanced cooperation, building economic partnerships and achieving comprehensive development based on common interests and mutual benefits, in order to meet the aspirations of our Arab peoples and achieve growth and prosperity,” the declaration partly reads.
More insights
Nigeria experienced a substantial decline of 62.4% in foreign investments from countries visited by President Bola Tinubu and Vice President Kashim Shettima, according to the third quarter 2023 Capital Importation report by the National Bureau of Statistics (NBS).
- A quarterly analysis reveals that capital inflow dropped from $643.3 million in Q2 2023 to $242.09 million in Q3 2023 representing a 62.4% decrease.
- In total, the UAE and Saudi Arabia recorded investment of $258 million and $0.43 million in the whole of 2023 compared to $116.8 million and $9.2 million in 2022 respectively.
- The Nigerian government has been courting foreign direct investments from Arab countries to help improve the country’s foreign currency reserves.
Earlier in the month the president addressed a cross section of potential Saudi Arabia investors, assuring potential them that their investments will be safe in Nigeria.