From Sudanese gold to geopolitical struggles: Saudi Arabia's new calculations in the small fish region

In late January, a new development emerged in the economic and geopolitical competition among Arab countries, with the main factor being gold from Sudan. Saudi Arabia is not only seeking to strengthen its influence in the region but also taking concrete steps to shift the long-standing balance in the gold trade—a sector where the United Arab Emirates (UAE) has long played a central role. According to BlockBeats, Riyadh is planning to purchase large quantities of gold from the war-torn African country to reduce Sudan’s dependence on gold exports to the UAE.

Economic Basis: Why Sudanese Gold Matters in Arab Competition

In this competitive context, economic data reveal the true importance of Sudanese gold. Official statistics show that in the first nine months of 2024, Sudan exported approximately 10.9 tons of gold, worth about $1.05 billion. During that period, most of this gold was redirected to markets in the UAE, reflecting the economic dependence between the two countries.

However, the political landscape has changed significantly. After Sudan officially accused the UAE of direct interference in the ongoing civil war, relations between Khartoum and Abu Dhabi were severed. This creates a strategic opportunity for Saudi Arabia—a country that has long sought to expand its economic influence in the region.

Changes in Export Strategy: From Dependence on the UAE to Seeking New Partners

To capitalize on this situation, Saudi Arabia’s Gold Refining Company announced its readiness to “start buying gold immediately” from the Sudanese government. Sudan’s state-owned mineral resources company also confirmed that initial negotiations had taken place. However, to date, specific transaction volumes and implementation schedules have not been publicly disclosed, and officials from Riyadh remain silent on the matter.

Many analysts view this move as a significant turning point, marking an escalation in the rivalry between Saudi Arabia and the UAE. It not only opens new fronts in commodity trade competition but also reflects the deep strategic calculations of Saudi Arabia in the Middle East region.

Risks and Opportunities: Can Saudi Arabia Replace the UAE’s Role?

Nevertheless, not all experts are optimistic about Saudi Arabia’s ability to fully dominate the Sudanese gold market in the short term. Some analysts suggest that this move is more of a political statement than a comprehensive trade strategy. Replacing the UAE’s role would require long-term investments and the development of robust economic infrastructure.

However, the financial pressure on Sudan is very real. The country faces large-scale gold smuggling abroad. Estimates suggest that about 80% of Sudan’s gold production could be lost due to illegal smuggling activities, costing the country up to $5 billion annually. In such a situation, any revenue from legal gold sales is highly valuable to Khartoum.

As Saudi Arabia increases its involvement in Sudanese gold trade, the global gold market and the distribution of gold supply from Africa and the Middle East could undergo structural changes with long-term impacts.