Mideast: The Emirate’s Napoleonic Financial Scheme
Abu Dhabi Ports
This May, Emirati company Abu Dhabi Ports signed a deal with Egyptian authorities, granting AD Ports authority over an industrial and logistics zone in East Port Said for the next fifty years. If this sounds familiar, that’s because it’s not the only time an Emirati company has made a long-term agreement for control of an Egyptian port; it’s not even the only time AD Ports has done it.
AD Ports already has two fifteen-year contracts for cement terminals in Egyptian ports. Additionally, they control a multi-purpose port on Egypt’s Red Sea Coast over a thirty-year contract.
Meanwhile, Dubai Ports has secured its own long-term contracts, positioning itself to extract sustained profit from Egypt’s trade network. These deals all arrive as Egypt is facing a massive debt crisis, owing more to the International Monetary Fund than any other nation except Argentina and Ukraine. Egypt needs cash, and the UAE is flush with it. The UAE is taking advantage of the immediate problem facing the Egyptian government to make a long-term investment.
Last year, the UAE and Egypt entered an agreement to build a new city on Egypt’s Mediterranean North coast. The UAE is represented in the agreement by the Abu Dhabi Developmental Holding Company. They are committed to USD 35 billion flowing into the project from the United Arab Emirates. Doubtless, the Holding Company is expecting a significant portion of expected revenue.
The UAE is not only making this calculation in Egypt but around the world. The deal they signed with President Trump promised multiple trillion dollars invested in American technological infrastructure. Furthermore, they would receive beneficial trade deals and incentives for technological growth and investment. These deals have the potential to be predatory. Chicago made an infamous deal during the financial crisis in 2008, in which it sold control of the city’s parking meters to a JP Morgan Chase-led group of investors. One of the primary investors believed to own a controlling majority is the Abu Dhabi Investment Authority. Chicago signed away billions of dollars over 75 years to temporarily balance its budget, only to be made a laughing stock as it lost money on the deal, accumulating hundreds of millions of dollars in losses over the years.
Bottomless Royal Coffers
How are they able to make such massive cash transactions so quickly? The answer lies in Sovereign Wealth Funds. Many Middle Eastern autocracies have Sovereign Wealth Funds through which they can make massive state-owned investments. As Matt Taibbi defined them for Rolling Stone Magazine, “Imagine the biggest and most aggressive hedge fund on Wall Street, then imagine that that same fund is fifty or sixty times bigger and outside the reach of the SEC or any other major regulatory authority.”
According to Business Chief, five of the ten largest Sovereign Wealth Funds in the Middle East are Emirati. These five companies control a combined USD 1.7 trillion in assets. This number is very possibly an underestimate.
Beyond the SWFs, government-owned companies in the UAE also generate significant profits. Rather than just buying up American streets and Egyptian coastline, these companies operate ports, construction projects, transportation logistics, and tech development while taking their share of the profits back to the Emirati coffers.
Emiratis In Africa
The UAE’s holdings in Africa are particularly striking as global superpowers inexplicably move away from the continent. Autarkist popular political movements in the US, China, and Europe have led them to reduce foreign spending, particularly in sub-Saharan Africa. US Secretary of State Marco Rubio has announced plans to eliminate the Department’s Africa office. Meanwhile, Africa’s population is the fastest-growing in the world. The resource-rich continent has a massive diaspora who are increasingly educated in the world's finest universities. The idea that Africa is irrelevant is absurd.
Right now, the global world order is in a state of flux. US President Donald Trump is moving away from traditionally American institutions such as NATO and the UN. His approach is leaving room for rich, dexterous nations, like the UAE, to spend, spend, spend.
In its African holdings outside of Egypt, the UAE invested greatly in the Sudanese Red Sea coast, which the Sudanese Armed Forces control. Meanwhile, in the shadows, they are supporting the opposite side of Sudan’s civil war, the Rapid Support Forces. In this way, the UAE hedges its bets; no matter who wins the war, the UAE is owed by the victor.
AMEA Power, an Emirati energy company, defines renewable energy investment across the region. From wind farms to water desalination, they offer a suite of services aimed at helping developing nations achieve the UN Sustainable Development Goals. They already operate in 20 countries across Africa and the Middle East, from South Africa to Jordan.
Additionally, various Emirati companies are invested across industries across the continent. They are involved in numerous internationally recognized development projects focused on clean energy and food security. Nonetheless, they also have a hand in multiple more extractive industries, such as oil drilling, precious metal and rare earth mining, and labor-intensive manufacturing.
The financial regime of the UAE amounts to a privatized state department. Capital-driven investment firms and operations companies are establishing Emirati influence worldwide.
The UAE’s investments on the African continent between 2022 and 2023 are more than three times those of China and almost ten times the American sum. As the world order continues to shift, the UAE is playing a forceful hand.
