Dubai Puts Hold on Planned $1.5 Billion Investment in Sub-Saharan Africa

Dubai World announced yesterday that they would be delaying several projects in its planned African investment portfolio, including six of eight planned tourism projects in Rwanda. The company said, “Dubai World has put on hold a number of projects until the market improves, including some tourism projects in Africa and elsewhere.”

Gulf-based investors have invested over $15 billion in sub-Saharan Africa since 2007. This figure was expected to grow explosively, but recent market downturns and prolblems back home have made this companies slow their investment in the continent. Although investors remained enthusaistic at the begninng of the global financial crisis, recent months have seen a severe cooling of the investment environment.

Because sub-Saharan Africa’s tourism infrastructure relies so greatly on outside investment, the current risk-adverse environment has troubling implications for growth in the sector.