Shunned by the West, Zimbabwe’s UAE Gamble Hands Economy a Lifeline

By Bloomberg News

Zimbabwean President Emmerson Mnangagwa’s six years of wooing the United Arab Emirates has given a lifeline to a nation that the West has ostracized for a quarter century and is unable to repay its loans to China.

The wealthy Gulf state has overtaken China to become the resource-rich nation’s biggest export partner and since 2022 has plowed $1.4 billion into everything from gold trading to real estate.

The steps are part of a wider effort by the UAE to build influence across Africa that’s seen it become the country that routinely pledges the most foreign direct investment into the continent.

“The UAE has gone within a few years from being unknown in commerce to becoming the nation’s foremost trading partner,” Eldred Masunungure, a political science professor at the University of Zimbabwe, said.

In Mount Hampden, 11 miles northeast of Harare, Shaji Ul Mulk, a Dubai-based businessman who owns Mulk International, is developing a flagship “cyber city” for the rich to replace the capital, which is in ruin.

The Dubai Gold & Commodities Exchange has a pact to establish a gold market and miner Bluefin Gold Group plans to set up in the country.

The oil-rich Gulf state is also consistently among the southern African nation’s top five foreign direct investment sources, according to the Zimbabwe Investment and Development Agency. And it doesn’t plan to let up.

The UAE wants to maintain and expand its relationships with Zimbabwe in line with its broader foreign policy objectives, a UAE official who asked not to be identified said.

Still, caution may be warranted because of the state of Zimbabwe’s economy. The southern African nation’s debt pile has ballooned to $21 billion since a default in 1999. Its sixth attempt at a viable local currency in 16 years is foundering less than nine months after debut.

The economy is largely informal, high inflation, the economy’s Achilles’ heel, persists, making it difficult for big businesses to flourish.