Summary:

 On 11 May 2025, the French Development Agency (AFD) announced 150 million euros in funding for investments in Western Sahara, including the city of Laayoune. 

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These investments in sanitation and ports modernization were announced during a visit by a delegation from the AFD led by its director Rémy Rioux. Rioux stated that the southern region of Morocco represents “an exceptional ecosystem, but also a very fragile one,” referring to the disputed status of the region.   

Meanwhile, the Hungarian Ambassador to Rabat, Miklós Tromler, stated during a visit to the region that Hungarian companies are interested in exploring new opportunities. The diplomat said that “the Sahara is rich in potential and structuring projects in several strategic sectors, particularly tourism, agriculture, fishing and renewable energy.” 

This comes as the Minister of Transport and Logistics, Abdessamad Kayouh, stated during the 12th International Transport and Logistics Exhibition for Africa and the Mediterranean (Logismed) that “particular attention will be paid to the southern regions, particularly Dakhla and Guerguerat, to develop logistics zones in line with the objectives of the Kingdom’s Atlantic Initiative.” 

Outlook: 

Interest from foreign investors in the Western Sahara region is an encouraging sign of potential future economic and infrastructure development. In the long-term, additional connectivity in the region will stimulate the creation of job opportunities and increase practical incentives for Moroccans to establish businesses and make investments. 

Southern region development is a pillar of the Royal Atlantic Initiative which heralds plans to revitalize the region as a hub for transactions with Sub-Saharan, Sahelian, European and both South and North American countries.  

These development projects are likely to reinforce Morocco’s adhocratic control of the Sahara even before the resolution of the dispute with the Polisario Front. The latter is likely to continue refusing such projects as long as it is excluded from the region. 

Algeria is also likely to contest such development while highlighting the Sahrawis’ right to self-determination and supporting their own efforts to position themselves politically and economically. 

An escalation from the Polisario may put development plans in that region at risk should it result in an uptick in threats of violence or actual violence. 

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