How regional reforms are boosting investor confidence

The Middle East and North Africa region is experiencing a remarkable upswing in mergers and acquisitions. Between January and September, it recorded 649 deals worth more than $69 billion. This is a 23 percent jump in volume.
According to regional transaction trackers, cross-border deals accounted for about 76 percent of the total value, highlighting a clear surge in foreign appetite for MENA assets. This increase is not a coincidence. It reflects a clear shift in the region’s regulatory and policy environment, with governments actively de-risking their markets and signaling long-term stability to global investors.
For years, investors viewed parts of the region with caution due to opaque regulations, slow licensing processes and limited clarity around ownership and dispute resolution. But the landscape is changing rapidly.
For example, Saudi Arabia’s new investment law, introduced earlier this year, has streamlined registration procedures and reduced administrative hurdles. Oman’s establishment of a dedicated investment court in March was another important shift, offering faster, clearer handling of commercial disputes. As such, MENA nations clearly want to develop their markets to become easier to navigate, more transparent and open to global capital.
The effects of these changes are already visible in the sectors attracting the most capital. The chemicals, advanced technologies, industrial and digital infrastructure sectors are leading the region’s deal value. One prominent example is the $16.5 billion acquisition of a 64 percent stake in Borouge in the UAE, one of the largest chemicals transactions globally this year.
In Saudi Arabia, investor confidence in the digital economy continues to accelerate. Tamara’s $2.4 billion debt facility, finalized in the third quarter, shows growing conviction in the Kingdom’s fintech sector. Meanwhile, a $2.2 billion purchase of a 40 percent stake in Khazna Data Center in Abu Dhabi reflects the region’s push for digital sovereignty and artificial intelligence capacity.

MENA nations clearly want to develop their markets to become easier to navigate, more transparent and open to global capital.

Zaid M. Belbagi

Adding to this is the prominent role of Gulf sovereign entities, which deployed about $21 billion in transactions in the first half of 2025 alone.
North Africa is benefiting from the improved environment as well, though with a wider variation in speed and execution. The investment authority in Egypt has already boasted that the introduction of a single digital portal this year has brought down the processing time and increased the visibility of future opportunities. Morocco is also gradually establishing itself as a regional industrial destination, especially in the areas of renewable energy and the production of motor vehicles, facilitated by an improved regulatory transparency to foreign investors.
However, even amid these increasing advances, the region is still grappling with structural challenges. One of the main concerns remains implementation. New laws have been rolled out at impressive speed but enforcement remains uneven, with some markets still hampered by slow or inconsistent administrative processes.
Without a concerted push to strengthen institutional capacity, through deeper digitalization, more assertive competition authorities and courts capable of resolving disputes efficiently, the current surge in investor confidence risks becoming unsustainable.
Another structural challenge arises from the heavy involvement of state-linked actors. Although sovereign wealth funds have played a crucial role in launching the current mergers and acquisitions cycle, long-term competitiveness requires a balanced ecosystem where private investment grows alongside state capital. Without this balance, market concentration could limit innovation and competition.
The current situation shows that the overall direction is clear. The region is steadily shifting away from reactive, ad hoc economic management toward a more structured, rules-based investment environment. But this evolution also reveals another layer to the story. While regulatory reforms and sovereign-led strategies have undeniably strengthened market sentiment, part of today’s deal flow is being shaped by necessity rather than confidence.
The Saudi Public Investment Fund’s plan to list several portfolio companies in 2025 — an intentional move to offload mature assets, recycle capital and redirect liquidity into higher-priority Vision 2030 sectors — underscores this dynamic.
At the same time, a growing share of major mergers and acquisitions activity across the region involves distressed assets, as firms that once relied on cheap short-term debt now struggle with expensive refinancing and covenant pressures, prompting forced sales and restructurings. This has opened the door to strategic buyers.
The Abu Dhabi National Oil Company and OMV have expanded their petrochemical footprints through acquisitions such as Borouge and Nova Chemicals. Egypt’s sovereign fund offloaded a 39 percent stake in seven prominent hotels, including Cairo’s Mena House and Luxor’s Winter Palace, to Talaat Moustafa Group in an approximately $800 million deal aimed explicitly at deleveraging its hospitality arm. In other words, reform-driven confidence coexists with a discrete but significant wave of distress-driven consolidation.
Looking ahead, the MENA region stands at a pivotal crossroads. Reforms, sovereign investment strategies and regulatory shifts have laid the groundwork for a more predictable, rules-based market, attracting both local and international capital. The challenge now is to sustain it, turning today’s achievements into a long-term investment cycle marked by strong institutional strength.

• Zaid M. Belbagi is a political commentator and an adviser to private clients between London and the Gulf Cooperation Council.
X: @Moulay_Zaid