Egypt’s cabinet said last week Saudi is decided to invest in Egypt’s financial markets. This huge investment, of approximately $5 billion will boost the market. It is important to know why Saudi Arabia took this action. What is their motive behind it? The UAE also invested in Egypt’s market before Saudi Arabia, which was $35 billion. Saudi investment is less than UAE investment. It means Saudi Arabia is still being careful. It seems the Saudi nation wants to control the region instead of helping them.
In 2022, Saudi Arabia made clear announcements about not helping its allies free of cost. The nation said it would no longer offer “free handouts.” Now helping Egypt is a sign that the nation wants more influence and control in the region.
Saudi Arabia wants to secure its place in Egypt as it tries to move its economy away from oil. This isn’t about being generous. Saudi Arabia is looking out for its interests, aiming to influence Egypt’s future choices while gaining more power.
This move by Saudi Arabia seems to be trying to push out the United Arab Emirates, as Egypt’s main economic partner. Nowadays, Saudi Arabia is the biggest competitor of the UAE in Africa and the Middle East. The nation has aum to increase its influence. The United Arab Emirates has already invested in Egypt’s Ras el-Hekma resort. This $35 billion investment makes the UAE, Egypt’s biggest economic partner.
NEOM project of Saudi Arabia
Now the main focus of Saudi Arabia is its NEOM project. The nation wants to control both sides of the Red Sea, including Egypt’s side. Saudi Arabia plans to invest $5 billion in future projects along Egypt’s Red Sea coast. It could make Saudi Arabia more powerful in Egypt’s economy.
Saudi Arabia’s involvement in Egypt’s economy may seem good, but it could mean it’s trying to control it for its benefit. This could make Egypt depend more on Riyadh and less on the UAE. This could ultimately weaken Egypt’s ability to make independent decisions.
It seems that Saudi Arabia invested in Egypt’s economy due to its political interest rather than supporting the nation. Saudi officials know how to utilize Egypt’s stability for its regional influence.
Instead of offering true assistance, Saudi uses its state-run Public Investment Fund to secure control over Egypt. This is more about power than partnership.
The importance of Egypt is increasing, because the nation plays an important role in the Israel-Hamas war, attracting $57 billion in funds. The UAE also contributed, but the amount is half of this. It highlights the competition between Saudi Arabia and the UAE for power control in Egypt.
Saudi interest: Real support or gaining power?
Saudi Arabia’s interest in Egypt is more about rivalry with the UAE than helping Egypt’s economy. For example, Saudi has shown interest in developing valuable land along Egypt’s Red Sea coast, like Ras Ghamila, likely to expand its influence.
Saudi Arabia wants to control the Red Sea as the nation develops the $500 billion NEOM city. This huge project has a special aim, to attract the attention of millions of tourists. Furthermore, Saudi Arabia wants to secure the Red Sea to protect its investments and ensure the success of its resorts.
The Red Sea is also crucial for trade purposes. It connects the Mediterranean to the Arabian Peninsula. This connecting point makes it important for Saudi oil exports. Back in 2016, the Kingdom controversially bought the Tiran and Sanafir islands from Egypt. The purpose was only to increase its control in the region.
Now, with Egypt selling land along the Red Sea, Saudi Arabia may try to expand its influence further, clashing with other regional powers like the UAE. This growing control by Saudi Arabia raises concerns about its dominance in the area and the impact it could have on other nations along the Red Sea.