With the crisis in the Middle East, Africa is getting more attention from commodity traders as a platform for strategic diversification.
Despite Tuesday’s ceasefire, only a handful of ships passed through the Strait of Hormuz on Wednesday: Two bulk carriers—one Greek-owned, one Liberia-flagged—were confirmed, reports Qorvis’ Tom Sharpe. It also appears that three Chinese-owned ships and one US-sanctioned Iranian oil tanker, the Tour 2, passed through. This low volume can be attributed to uncertainty around safe passage in the Strait, compounded by doubts about the strength of the ceasefire, Sharpe says.
In the long term, uncertainty in the Middle East may boost interest in Africa, particularly across critical minerals, energy, fertilizers, trade corridors, and trade finance. The continent is seen as both highly exposed to global shocks and increasingly vital to global supply-chain resilience.
From a trader’s perspective, Africa is less a single market than a set of variable risk-reward opportunities. The continent has long term potential in terms of value addition, not just extraction. The real opportunity lies in creating partnerships to improve local processing, infrastructure, and regulation, as well as making African supply more bankable and reliable in a fragmented global commodity market.
Pricing in chokepoints in the Middle East and Africa
Tom Sharpe, Senior Advisor, London
Middle East investors currently have to price in chokepoint seizures, whether that is by Iran or the Houthis before them. In the Bab El Mandeb, ships went around The Cape and increased costs were absorbed relatively painlessly. Since then, the Strait of Hormuz shows that even shipping has an elastic limit, particularly when there is no “around” option.
Meanwhile, Africa’s shipping risks are pure non-state piracy in the Gulf of Guinea and Somali waters. Neither of these are particularly pleasant but they are at least containable and therefore priceable. Africa has its own chokepoints; Suez, Bab el-Mandeb, and Gibraltar, but no African government or militia is weaponizing them to hold world trade hostage. At least not yet…
This asymmetry is why Africa is the saner bet right now: its commercial shipping faces manageable, localized headaches—not geopolitical black swans that turn international straits into war zones.
Africa and the new geopolitics of critical minerals
Brad Klapper, Chief Intelligence Officer, Washington, DC
Critical minerals are no longer just about securing raw materials. They represent the future of global industry. Instability in the Middle East and elsewhere is shifting industrial focus toward regions offering both resource depth and strategic flexibility. Africa has vast reserves of minerals essential to advanced manufacturing and next generation technologies. It also has geography, expanding investment capability, and population growth. It represents an opportunity to rebalance global supply chains and reduce dependencies.
Initiatives like Project Vault underscore this promise. Project Vault is a U.S. public-private effort to build a strategic reserve of critical minerals for commercial industries. But it should be seen as a chance for Africa as well. Many of these inputs can be found in Africa. We should all be thinking about how to leverage initiatives such as this to empower Africa to move beyond extraction toward integrated value chains that include local processing, infrastructure investment, and stronger governance.
There are challenges in Africa, too. Political and regulatory environments differ significantly across countries and infrastructure gaps make large-scale investment harder. China’s mining and processing prowess makes it hard for Western projects to be competitive. We shouldn’t view Africa as a silver bullet. We should see it as a market where opportunity and risk coexist. But a place where we can do so much more at a time of limited alternatives. Success depends on sustained engagement, credible partnerships, and a commitment to investing not just in resources, but in the institutional and economic foundations that support long-term growth.
UAE loses luster due to new risks
Noe Boggan, Analyst, Dubai
For years, the UAE has attracted a steady and massive influx of business incorporation, driven by its strategic location and business-friendly tax and legal frameworks. A key factor of the country’s appeal is its security, boasting low crime rates and regional stability.
Unfortunately, the war in Iran has challenged the Gulf’s long-standing reputation as a safe haven. Companies that previously considered relocating their headquarters to hubs like Dubai have now decided to maintain a stronger presence in jurisdictions less exposed to regional conflict, such as Europe.
Thus far, the temporary exodus of personnel does not translate to a full corporate exit. While some bankers are returning to the region, others have shifted assets elsewhere, including Asian financial centers like Singapore. The long-term implications for GCC economies remain uncertain, depending on the duration of the conflict. However, as costs rise and security risks intensify, businesses are certainly adopting a more cautious approach to expansion in the region and may increasingly seek diversification in other markets.
Growing interest in Africa as power dynamic shifts
William Sadler, Director, Washington, D.C.
Over the past decade, the interest in the African continent has grown considerably. There has always been an interest in Africa: Colonial powers knew very well the raw resources and capabilities of the continent and its peoples for hundreds of years. Today is no different in terms of capabilities, but the power dynamic has shifted in Africa’s favor. African nations have made it clear that they WILL be directly involved in the future of their countries, their regions, and their continent. Africans have recognized that their untapped potential in areas like critical minerals, human capital, infrastructure development, and cultural exchange make them stand out as the emerging place to invest time and money.
Regional leaders are ready, and other countries are already there. China, Russia, and other actors have made deep inroads into the foundational infrastructure of the rapidly developing continent, frequently trapping unsuspecting or over-trusting countries, leaders, or governments into drown-out debt traps. The rhetoric is the same in many African circles that I have been a part of recently: “If investing in Africa were a meal, the Americans are just sitting down for lunch, and the Chinese have already gotten the bill for breakfast.” I had the pleasure of riding a first-generation Chinese plane in West Africa, with Mandarin superseding English on the emergency pamphlets—for those who understand the role of English in aviation, this is worrying.
African leaders and peoples do not want more handouts, shows of faith, and poorly structured deals. These proud leaders want their own people to learn new skills, grow their own countries’ industries, and rise with their brothers and sisters across the continent. They want to tap into the trillions of dollars coming out of their ground through agriculture and mining. They want to compete on a global scale. Ultimately, they are ready for business and want a seat at the table.
Africa in the eyes of commodity traders
Benoît Lioud, Managing Director, Geneva
In the midst of crisis in the Middle East, Africa is getting more attention from commodity traders, though mainly as a means of strategic diversification rather than wholesale replacement of Middle East operations. The focus is on critical minerals, energy, fertilizers, trade corridors, and trade finance, with the continent seen as both highly exposed to global shocks but increasingly important for global supply-chain resilience.
From a trader’s perspective, Africa is less a single market than a set of very different risk-reward opportunities. Oil or minerals exporters can benefit from higher prices, while import-dependent economies face inflation and logistics strain. The same geopolitical shock can create very different outcomes across the continent.
Africa is being viewed as a long-term option in terms of value addition, not just extraction. The real opportunity lies in creating partnerships, such as processing more locally, improving infrastructure and regulations, and making African supply more bankable and reliable in a fragmented global commodity system.
