UAE To Build Red Sea Port In Sudan In $6 billion Investment Package

On Monday, June 20th, the chairman of DAL Group, a private Sudanese conglomerate and the largest private company in the country, revealed that he and the United Arab Emirates will build a new Red Sea port in Sudan as part of a $6 billion investment project. Osama Daoud Abdellatif, DAL group’s chairman and a partner in the deal, noted that the package includes a free trade zone, a large agricultural project, and an imminent $300 million deposit to the Central Bank of Sudan. Outlines of the new deal had been agreed upon between Sudanese leader General Abdel Fattah al-Burhan and U.A.E. President Sheikh Mohamed bin Zayed during a recent visit to the U.A.E. This is the first announcement of investment in Sudan since the military takeover of the country in October 2021. 

The $4 billion port, which would be able to handle a multitude of commodities and compete with the country’s main national port, Port Sudan, is a joint project between DAL group and Abu Dhabi Ports, owned by Abu Dhabi’s holding company ADQ. Located about 124 miles (200 km) north of Port Sudan, the new port would also include a free trade and industrial zone modeled after Dubai’s Jebel Ali, as well as a small international airport. The $1.6 billion expansion and development of an agricultural project will be undertaken by Abu Dhabi conglomerate IHC and DAL Agriculture in the town of Abu Hamad in northern Sudan. Alfalfa, wheat, cotton, sesame, and other crops would be grown and processed on the 400,000 acres of leased land. A $450 million, 310 mile (500 km) toll road connecting the project to the port would be built as well, financed by the Abu Dhabi Fund for Development.

Western donors suspended billions in aid and investment to Sudan after the October 2021 coup, plunging an already struggling economy into further turmoil and depriving the government of much needed foreign currency. This was done in order to compel the coup leaders to restore civilian rule and support the democratic transition process in the country. In a tweet on Monday, Cameron Hudson, a CSIS Senior Associate for Africa, stated that this deal was comparable to “a thumb in the eye of U.S. and international efforts to prevent the junta from getting a financial lifeline before political talks could conclude.”

Port Sudan, Sudan’s largest port and main commercial and trade hub housing critical oil export terminals, has endured infrastructure challenges and was shut down by a six-week political blockade late last year, losing business from major international shippers. “The U.A.E. wants a stable Sudan so they can do more and more of these investments, but we are not waiting for everything to be perfect,” Abdellatif remarked.

Rumors of Gulf investments in Port Sudan, and in agricultural projects elsewhere in the country, have continuously sparked significant civilian opposition and protests, specifically in the eastern part of the country. As Sudan continues to endure a declining economy, a newly built U.A.E.-backed port is bound to destabilize the fiscal viability of Port Sudan allowing the U.A.E. port to commerce without much competition. Furthermore, many new Gulf-Horn relationships are highly asymmetrical, driven more by Gulf than African interests.

A U.A.E. port built on the Sudanese coast ultimately secures the Gulf’s significant control over the Red Sea where both the U.A.E. and Saudi Arabia can establish a military base in light of the ongoing Yemen Civil War. Gulf states are injecting resources and exporting rivalries in the Horn of Africa which could further destabilize precarious local politics. Therefore, Horn and Western policymakers should seek to limit intra-Gulf disputes in Africa by expanding the role of regional multilateral organizations to boost Horn states’ bargaining power. Allies should also convince the Gulf states that their actions are detrimental to ensuring long-term security across the Red Sea basin.

On October 25th, 2021, Sudan’s military arrested at least five senior Sudanese government figures. Later that day, Abdel Fattah al-Burhan declared a state of emergency and announced the dissolution of the government and the Sovereignty Council. In a televised address to the nation, al-Burhan declared that a new technocratic government would lead Sudan until the next elections in July 2023. Decades of war, isolation, and sanctions have long been attributed to Sudan’s economic crisis. The crisis had shown signs of abating before the coup, but now the Sudanese population faces yet another humanitarian crisis with renewed state violence and rising levels of hunger plaguing the country.

Ultimately, the current priority for the international community should be to economically and politically stabilize Sudan by forcing the current authoritarian regime out of power and promoting a democratic government. Normalization of relations between the Gulf and Sudan’s current government will significantly hinder efforts to restore democracy and economic stability to the country. The Gulf States must become convinced that while competition and rivalry in the Horn of Africa may serve their immediate political and commercial goals, it is equally likely to hinder the long-term stability of the region, which would ultimately serve to their own disadvantage.