For the first time in years, the Middle East and North African region is seeing a surge in interest from international investors.
Major companies like Google, Microsoft and Adobe recently took part in one of the largest technology events in the region when Dubai hosted Expand North Star 2024, which attracted over 6,500 exhibiting companies, 1,800 startups and 1,200 investors from 180 countries.
Over the last year, more than half of all investors in regional startups have come from outside, reflecting how attractive the Middle East and North Africa, or MENA, have become for those seeking new areas for growth, including investors from the U.S., Europe and beyond.
Farah el Nahlawi, a United Arab Emirates-based research team leader at venture data platform MAGNiTT, provided hard numbers on the surge of international investment in the MENA region.
“In the first nine months of 2024, we recorded a total of 390 investors in the MENA region, with 199 of them being international investors,” Nahlawi said. “When we break down these international investors, we see a diverse mix of contributors: 37% from the USA, 13% from the U.K. and 8% from Singapore.”
Financial technology
According to a recent report from MAGNiTT, the financial technology sector emerged as a key driver, securing $480 million in funding.
At the heart of this trend is the desire for many countries in the region, like the UAE and Saudi Arabia, to move beyond traditional resource-based industries like oil, Nahlawi, said. They’re investing heavily in technology, education and innovation, creating fertile ground for startups and entrepreneurs.
Nahlawi pointed to significant government initiatives across the region. “Programs such as Saudi Vision 2030 and the UAE's economic policies have been pivotal in attracting international capital,” she said.
“These initiatives have notably improved the investment climate through economic diversification, aimed at reducing reliance on oil,” she added. “By promoting sectors like tourism, technology and renewable energy, these governments are making their economies more resilient and appealing to investors seeking long-term stability.”
Willingness to do business in the region has drawn criticism from some venture capitalists who spoke on background to publications like Financial Times, calling the investments a "Faustian bargain" with governments and monarchs accused of human rights violations.
Saudi Arabia's alleged killing of Washington Post journalist Jamal Khashoggi in 2018, CNBC reported in September, "remains an issue for some Western partners and startups."
The Post reported in May that "some tech executives and security researchers" remain wary about those abuses, along with the possibility that some countries in the region could "use American technologies for surveillance — including to target U.S. citizens."
But for many international investors, the MENA region offers the chance to enter a fast-growing market with high returns. For local governments, it’s a way to secure long-term growth beyond oil.
Sergii Malomuzh, founder of Rewump — a business incubator for next-generation web startups — said regional governments are adopting progressive and flexible regulatory approaches to support emerging technologies and industries.
“This supports innovation and creates a favorable business climate for foreign investments,” he told VOA.
Malomuzh also said markets like the UAE remain attractive because of their high growth potential and stable economic policies. “From my experience investing in and working with the MENA region, I’ve noticed that investors come from various places, including the U.S., Europe, and the Gulf.”
Talent in Sudan
Yousif Yahya, co-founder of Sudan’s Savannah Innovation Labs, a prominent incubator and consultancy firm, emphasized Sudan’s unique position within the MENA investment landscape. Although much of Sudan’s young, talented and mobile workforce has been displaced by war, Yahya told VOA that some victims were fortunate enough to find opportunities outside Sudan, sometimes filling skills gaps and contributing to cross-border innovation.
Yahya also noted that a surge in international interest is partly driven by countries like Egypt, where comprehensive policy reforms have been enacted to attract and protect foreign investments. These measures, he argued, reflect a commitment across the region to build a stable, predictable and investor-friendly environment.
Robert Mogielnicki, a senior resident scholar at the Arab Gulf States Institute in Washington, highlighted the region’s potential for entrepreneurial growth despite conflicts in several countries.
“Countries in the MENA region boast young and growing populations and contain many promising startup scenes,” he told VOA.
Mogielnicki pointed out that many MENA governments, particularly in the Gulf, are actively investing in entrepreneurship. “In some cases, government entities provide direct support and investments to startups. In other instances, governments are seeking to enhance the startup and entrepreneurial ecosystems through supportive policies.”
However, he cautioned, wars and geopolitical tensions could impact startups differently.
“The implications for startups and their ability to secure investments depend greatly on the industry they operate within, the potential for disruptions to operations, and fluctuating levels of available investment capital,” Mogielnicki said.
