Christian Maronite east Beirut residents stage rally in front of French embassy to support General Michel Aoun’s refusal to accept Taif agreement. AFP
Christian Maronite east Beirut residents stage rally in front of French embassy to support General Michel Aoun’s refusal to accept Taif agreement. AFP

1989 - The Taif peace pact for Lebanon

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Updated 19 April 2025
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1989 - The Taif peace pact for Lebanon

1989 - The Taif peace pact for Lebanon
  • Saudi Arabia’s determination helped end the Lebanese Civil War

PARIS: The Taif Agreement was the outcome of a concerted attempt by Saudi Arabia to bring an end to the Lebanese Civil War that began in 1975. 

Other parties involved in the process included Syria’s President Hafez Assad, the US administration, and the various Lebanese factions fighting in the war. Saudi authorities wanted to find a solution that involved all of those involved, to halt the war and improve upon the 1943 Lebanese National Pact. 

That pact was an unwritten agreement between Lebanese President Bechara El-Khoury and Prime Minister Riad Al-Solh that established an independent Lebanon as a multi-confessional state. It represented a power-sharing arrangement between Christians and Muslims, whereby the president was always required to be a Maronite Christian, the prime minister a Sunni Muslim, and the speaker of the parliament a Shiite. 

The powers handed down in this way were of particular benefit to Lebanon’s Christians. The civil war required an adjustment to this equilibrium. It also required an adjustment in Lebanon’s relations with the Arab world, during a period in which Assad was growing more powerful with the aim of becoming more influential and hegemonic in Lebanon. 

How we wrote it




Arab News covered the day Lebanese MPs agreed on the national reconciliation charter in Taif, Saudi Arabia to end the civil war.

Beginning in the late 1970s, Saudi Arabia had been a part of all Arab and international efforts to end the war in Lebanon. The Taif Agreement was fathered by Hussein El-Husseini, the speaker of the Lebanese parliament. He visited Saudi Arabia, where he was hosted in Taif under the guidance of the Foreign Minister, Prince Saud bin Faisal, and a Lebanese friend of the Kingdom, a businessman named Rafik Hariri who would later serve as Lebanon’s prime minister from 1992 to 1998 and 2000 to 2004. 

The deal ultimately reached included political reforms that gave full power to the Council of Ministers and greater power to the Muslim prime minister, compared with the previous arrangement whereby power was concentrated in the office of the Christian president. It also established special relations between Lebanon and Syria, and a framework to begin the withdrawal of Syrian forces from the country. 

However, Syrian Foreign Minister Farouk Al-Sharaa later denied any commitment had been made to Prince Saud for Syria to withdraw from Lebanon. It was only after the assassination of Hariri in 2005 that Syrian forces finally pulled out. 

The Taif Agreement was approved by the Lebanese Parliament on Nov. 5, 1989, the same day Rene Moawad became the country’s president. He held the office for only 18 days before he was killed by a car bomb that claimed his life and 23 others. 

Prior to the Taif Agreement, Saudi Arabia had pushed for peace conferences in Geneva and Lausanne, in 1983 and 1984 respectively, that failed to end the war. However, Saudi authorities continued to mediate, with the involvement of the Arab League Tripartite Committee to Lebanon, under the chairmanship of Prince Saud. 

Key Dates

  • 1

    Fighting between Maronites and Muslims in Lebanon begins when suspected PLO gunmen attack a Christian church in East Beirut, killing 4 people. Phalangists retaliate, killing 30 Palestinians on a bus, triggering widespread fighting.

    Timeline Image April 13, 1975

  • 2

    Arab League summit in Riyadh calls for end to the civil war and creates the peacekeeping Arab Deterrent Force.

  • 3

    Start of the Hundred Days War in Beirut between Christian militias and the mainly Syrian troops of the Arab Deterrent Force.

    Timeline Image Feb. 7, 1978

  • 4

    Israel invades southern Lebanon to halt cross-border attacks by the PLO.

  • 5

    Christian Phalangist Bachir Gemayel, former leader of Lebanese Forces Maronite militia, is elected president.

    Timeline Image Aug. 23, 1982

  • 6

    Gemayel and 26 other high-ranking Phalangists are killed by a bomb planted by a Maronite Christian.

    Timeline Image Sept. 14, 1982

  • 7

    Departing president Amine Gemayal defies precedent and appoints a fellow Maronite Christian, Gen. Michel Aoun, as prime minister, a role traditionally reserved for a Muslim.

    Timeline Image Sept. 22, 1988

  • 8

    Aoun declares war of liberation against Syrian occupation.

    Timeline Image March 14, 1989

  • 9

    Taif Agreement is reached but opposed by Aoun.

  • 10

    Taif Agreement ratified and parliament elects Maronite Christian Rene Moawad as Lebanon’s 13th president.

    Timeline Image Nov. 5, 1989

  • 11

    Moawad assassinated by unknown assailants.

    Timeline Image Nov. 22, 1989

  • 12

    Aoun driven into exile in France by Syrian forces.

  • 13

    Aoun returns to Lebanon after Syrian troops finally withdraw.

  • 14

    Aoun elected president of Lebanon, remains in office until his term ends in 2022.

    Timeline Image Oct. 31, 2016

The representatives on the committee from the other members of the tripartite, Morocco and Algeria, were their foreign ministers, Abdellatif Filali and Sid Ahmed Ghozali respectively. They were joined by the Arab League’s special envoy to Lebanon, Lakhdar Brahimi. Syria’s President Assad, excluded from the committee, was enraged. 

During the last meeting of the committee, in Rabat in 1988, before the Taif process began, the three ministers summoned Al-Sharaa, the Syrian foreign minister, and told him they had proof Syria had been arming both Prime Minister Michel Aoun’s army and the Lebanese Forces, led by Samir Geagea.  

Aoun had been appointed interim prime minister that year by departing president Amine Gemayel, who did not accept Assad’s diktats. 

Assad’s forces responded by pounding the Christian stronghold of Achrafieh. Aoun, protected by French Ambassador Rene Ala, then left for France to begin his long exile.  

Brahimi, the Arab League envoy, enlisted Paris-based Dr. Ghassan Salame, a Lebanese professor of international relations, as an advisor to help establish a ceasefire agreement and prepare for a meeting with Lebanese deputies.  

Concurrently, Brahimi, Salame, and other deputies worked on drafting a text for the deputies to approve and adopt. 

The first report from the committee, issued in mid-July 1989, was perceived by the Syrians as hostile. Assad met Algeria’s President Chadli Bendjedid in Algiers and accused Brahimi of anti-Syrian bias. Prince Saud independently continued his attempts to persuade Syria to agree to a ceasefire. 




Saudi Arabian Foreign Minister Prince Saul al-Faysal (C), Lebanese Parliament speaker Hussain al-Hussaini (R) and Algerian Foreign Minister Ahmad Ghassali (L) in Taif as discussions on national reconciliation charter began. AFP

As the various efforts to end the war continued, Saudi authorities worked through two negotiators: Hariri and Prince Bandar bin Sultan, who between 1983 and 2005 was the Kingdom’s ambassador to the United States. This marked the start of Hariri’s involvement in Lebanese politics. 

King Fahd entrusted Prince Bandar to direct the efforts to find a solution for the situation in Lebanon, and Hariri shuttled between various capital cities to organize a conference in the Kingdom to discuss reforms and the election of a president. 

International pressure, and the continuing efforts of Prince Saud, eventually compelled Syria to accept a ceasefire agreement, paving the way for the drafting of the text for the Taif Agreement by several deputies.  

Hariri managed to persuade the Lebanese deputies to come to the gathering in Taif. They agreed to correct the balance of power in Lebanon, giving more influence to the Council of Ministers and the Muslim prime minister. 

However, Assad disliked Hariri and resisted his appointment as Lebanon’s prime minister for years. Eventually, Assad met Hariri on several occasions, though when Hariri did eventually become prime minister, Assad insisted on having a say in the appointment of certain government ministers. 

Saudi Arabia took the initiative and helped to get the Lebanese Parliament operational, since previous negotiations with militias had failed to achieve peace. Eventually, the Taif Agreement was concluded and implemented but Aoun never accepted its terms. Following the assassination of President Moawad after just 18 days in office, as he returned from Lebanese Independence Day celebrations, Deputy Elias Hrawi, who was favored by the Syrians, was appointed his successor. 

One unforgettable sentence uttered by a brilliant French diplomat, having served in Lebanon, still rings true in view of the disastrous situation that has prevailed there for the past several years: “The political class who made the civil war in Lebanon is still in power, but it cannot succeed in ruling the country.” 

  • Randa Takieddine is a Paris-based Lebanese journalist. She covered the last committee meeting in Rabat before Taif in 1988 for Al-Hayat and headed the newspaper’s bureau in France for 30 years. 


‘Songs of Silence in Nature’: Chinese artist Shu Li honored in Riyadh 

‘Songs of Silence in Nature’: Chinese artist Shu Li honored in Riyadh 
Updated 5 min 51 sec ago
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‘Songs of Silence in Nature’: Chinese artist Shu Li honored in Riyadh 

‘Songs of Silence in Nature’: Chinese artist Shu Li honored in Riyadh 
  • Artist’s work depicts serene scenes of mountains and lakes
  • Exhibition showcases cultural ties between China and Saudi Arabia

RIYADH: Saudi Arabia’s Art Pure Gallery Foundation is currently hosting an exhibition, “Songs of Silence in Nature,” by the renowned Chinese artist Shu Li.

Organized in collaboration with the Chinese Embassy in Saudi Arabia, the exhibition opened on June 24, 2024 and will run until July 25, 2025 in the Saudi capital. 

A leading figure in contemporary Chinese art, Shu Li has held distinguished roles within China’s national cultural institutions.

His works have been showcased in more than 20 countries, including the Leonardo da Vinci Museum in Italy. 

He has received numerous international accolades in countries such as Russia, Belgium, the US, Ukraine and India, and is a distinguished academician of the Russian Academy of Arts. 

His paintings are featured in some of China’s most iconic venues, including the National Art Museum of China, the Great Hall of the People, and the headquarters of the Chinese Communist Party.

He has also published more than 20 catalogues chronicling his artistic evolution. 

Shu Li’s work blends traditional Chinese techniques with a distinctly contemporary sensibility.

Characterized by tranquil landscapes, his pieces often depict mist-shrouded mountains and serene lakes. These works invite viewers to enter a meditative and reflective state. 

“Art is not merely a visual encounter,” the artist explained, “but an emotional journey.

“Through my oil paintings, I aim to capture those fleeting moments of beauty that enrich our daily existence.

“My work is a dialogue between the canvas and the world it portrays — a world where light dances across surfaces and color speaks more powerfully than words.

“Each painting is an exploration of texture, form and the expressive potential of oil as a medium. I draw inspiration from nature, human experience and the myriad ways in which art connects us to both. I invite viewers to do more than just observe my work; I want them to feel it and enter the narrative that each painting weaves.”  

This exhibition is part of an increasing cultural dialogue between China and Saudi Arabia. It reflects the desire of both countries to strengthen their artistic exchange and deepen the ties between these two ancient and influential civilizations. 

Contemporary Chinese art embodies a rich synthesis of millennia-old traditions and modern perspectives.

Since the late-20th century, Chinese artists have experimented with various forms, including painting, sculpture, installation and video, to explore the tensions between heritage, rapid urbanization and evolving social realities.  

Often merging classical craftsmanship with avant-garde techniques, they explore themes of identity, collective memory and the challenges of the present age. 

Today, China’s vibrant art scene is widely recognized internationally, with many leading Chinese artists playing a pivotal role in reshaping the global contemporary art landscape. 

The Art Pure Gallery Foundation is a leading Saudi cultural institution founded in 1999.


Pakistan PM, Azerbaijan president vow to boost trade and investment on ECO summit sidelines

Pakistan PM, Azerbaijan president vow to boost trade and investment on ECO summit sidelines
Updated 13 min 52 sec ago
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Pakistan PM, Azerbaijan president vow to boost trade and investment on ECO summit sidelines

Pakistan PM, Azerbaijan president vow to boost trade and investment on ECO summit sidelines
  • The summit brought together heads of government from ECO member states to discuss economic and political cooperation
  • Pakistan, bolstered by an IMF program, is looking to capitalize on its geostrategic location as a major trade and transit hub

ISLAMABAD: Pakistan Prime Minister Shehbaz Sharif on Friday met with Azerbaijan President Ilham Aliyev on the sidelines of the 17th Economic Cooperation Organization (ECO) summit, Sharif’s office said, with the two leaders agreeing to boost bilateral trade and investment.

The prime minister led Pakistan’s delegation at the ECO summit in Khankendi, Azerbaijan on July 3-4, which focused on the promotion of trade, sustaining development and enhancing regional connectivity.

Sharif noted that recent interactions between leaders of the two countries had helped strengthen relations and invited President Ilham to visit Pakistan at his earliest convenience, according to the Pakistan PM’s office.

“The two leaders agreed to enhance their cooperation in the fields of trade and investment while expressing satisfaction over the progress made regarding the investment prospects,” Sharif’s office said.

“Both leaders reiterated their resolve to strengthen the economic partnership, especially Azerbaijan’s investment in Pakistan.”

This is Sharif’s third visit to Azerbaijan in 2025. He last traveled to Baku in May as part of a broader push at economic diplomacy with the Central Asian republics, to whom Pakistan has offered access to its southern ports in Karachi and Gwadar.

The ECO summit, themed as “New ECO Vision for a Sustainable and Climate Resilient Future,” brought together heads of state and government from ECO member states to discuss economic and political cooperation.

Founded in 1985 by Iran, Pakistan and Turkiye, the Eurasian intergovernmental organization included Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan in 1992, aiming to establish a single market for goods and services.

Pakistan, slowly recovering from a macroeconomic crisis under a $7 billion International Monetary Fund (IMF) deal, has been looking to capitalize on its geostrategic location to boost transit trade and foreign investment for a sustainable economic recovery.

In July 2024, Azerbaijan announced a $2 billion investment in Pakistan during a visit by President Ilham Aliyev to Islamabad. In September last year, Pakistan signed a contract to supply JF-17 Block III fighter jets to Azerbaijan, marking the deepening of defense cooperation.


At least five dead in Pakistan building collapse: police

At least five dead in Pakistan building collapse: police
Updated 21 min 22 sec ago
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At least five dead in Pakistan building collapse: police

At least five dead in Pakistan building collapse: police
  • Up to 100 people had been living in the building
  • Roof and building collapses are common across Pakistan

KARACHI: A five-story building collapse in Pakistan on Friday killed at least five people and left six injured, with more victims trapped under the rubble, police said.

Rescuers and residents in the mega port city of Karachi worked together to pull people from the debris after the incident at around 10:10 a.m. (0510 GMT).

“We have so far retrieved five dead bodies and six injured people,” a senior local police official, Arif Aziz, said.

Up to 100 people had been living in the building, he added.

Saad Edhi, of the Edhi welfare foundation that is leading the rescue operation, said there could be “at least eight to 10 more people still trapped,” describing it as a “worn out building.”

He put the death toll at four.

Roof and building collapses are common across Pakistan, mainly because of poor safety standards and shoddy construction materials in the South Asian country of more than 240 million people.

But Karachi, home to more than 20 million, is especially notorious for poor construction, illegal extensions, aging infrastructure, overcrowding, and lax enforcement of building regulations.


Inside the Saudi 100 Brands showcase in Paris 

Inside the Saudi 100 Brands showcase in Paris 
Updated 40 min 43 sec ago
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Inside the Saudi 100 Brands showcase in Paris 

Inside the Saudi 100 Brands showcase in Paris 
  • A closer look at the 11 Saudi designers who exhibited during Paris Fashion Week last month

PARIS: During Paris Men’s Fashion Week last month, the Saudi 100 Brands showcase by Tranoï took over the fifth floor of the LVMH-owned La Samaritaine department store in the French capital. Eleven Saudi designers showcased their creativity in an initiative from the Saudi Fashion Commission. 

The top floor of the iconic address, with its historic peacock-mosaic frieze, Gustav Eiffel wrought-ironwork, and spectacular glass ceiling provided the perfect setting for the originality and exuberance of the young designers presenting their craftsmanship and heritage.  

Visitors at the Saudi 100 Brands showcase in Paris. (Supplied)

Burak Cakmak, CEO of the Fashion Commission of Saudi Arabia, said: “Saudi Arabia is a fantastic hub of talent and expertise. This showroom at La Samaritaine represents a major opportunity for Saudi designers to showcase their collections during Paris Fashion Week. It is also a powerful way to strengthen ties between the Saudi Fashion Commission and international fashion players, including Tranoï.”  

Here, we run down the 11 brands on show. 

1886 

Saudi streetwear brand 1886 on display in Paris. (Supplied)

Launched in 2016, 1886 was Saudi’s first premium streetwear brand. Renowned for its quality denim, the brand launched T-shirts this year featuring Jeddah, Al Ula and Abha to celebrate its Saudi heritage. Co-founder Fahad Aljomiah has a “Designed in KSA” sign on his office wall as a daily inspiration for his team. “We have the talent, knowledge, taste and willingness to work hard to set the industry standard, to put KSA definitely on the international fashion map,” he told Arab News.  

REBIRTH 

Tala Abukhaled launched her eco-friendly luxury resortwear label three years ago, to breathe new life into Saudi artistic craftsmanship and cultural traditions. “My clients tend to be people who love to travel, they’re adventurous, free-spirited and eco-conscious,” she said. One of Abukhaled’s recurring motifs is the integration of raffia made from palm fronds, and woven into macramé detailing. Her palette for her latest collection — Resort 25 — is neutral sand, with hot pink, tangerine orange and olive green. 

AWAKEN 

“Our slogan is ‘Open your eyes.’ We want to encourage people to wake up to their life, not to live in a virtual world,” said Khalid Almasoud, founder of the Riyadh-based streetwear brand. The brand’s logo is jaquard woven or serigraphed onto many of their pieces.  

WAAD ALOQAILI COUTURE 

Each intricate creation of this label — founded in 2019 by sisters Waad and Ahlam Aloqaili —  is strongly rooted in Saudi tradition, crafted with emotional elegance and cultural depth, with the goal of empowering women. Aloqaili’s hand-beaded teal and emerald mermaid gown with short train stole the show. 

ELEVEN 

Fusing innovation with comfort, the collection from this Riyadh-based label — bold, distinctive and contemporary —was entirely produced in Saudi, reflecting a strong local identity ready to be exported to the wider world. 

HAJRUSS 

Hajruss is a contemporary streetwear label fusing innovation and craftsmanship in its creations. The brand combines modernity and tradition, with particular attention to detail and high-end materials. “Each collection is a dialogue between heritage and innovation — where clothing becomes a medium for storytelling,” the catalogue for the showcase stated. 

MIRAI 

Mirai co-founders Abdulrahman Tarabeh (L) and Omar Shabra. (Supplied)

Mirai means ‘future’ in Japanese. The label fuses Saudi culture, style and energy with Japanese minimalism and attention to detail. “We chose the name Mirai because we believe that timelessness is the future,” said co-founder Abdulrahman Tarabeh. “We don’t follow trends, we don’t follow any fashion calendar; whatever we enjoy making, we make. With Omar (Shabra, his co-founder), we want to create a community where people can tell their personal stories through their clothes.’ Tarabeh pointed out a white jacket with tiny brown dots, “This is one of our signature designs. We sourced the fabric from Tuscany, Italy, and it’s coffee-washed,” he said. “The buttons are engraved with Sakura, Japanese cherry blossom.”  

RAZAN ALAZZOUNI 

With a background in sculpture and fine arts from Tufts University, Razan Alazzouni is known for “blending art, femininity, and craftsmanship” in her designs, which are “sculptural, delicate, and timeless” and “celebrate soft glamour and Saudi heritage through refined, handcrafted pieces made in her Riyadh atelier,” according to the catalogue.  

RBA 

Founded in 2017 in New York City, this “cross-cultural Saudi fashion brand” merges bold design, premium quality, and urban aesthetics to create unique streetwear pieces. “Each design is more than clothing — it’s a story woven with symbolism, culture, and modern elegance,” the catalogue stated. “RBA creates pieces that celebrate diversity, sustainability, and artistic expression.” 

REEM ALKANHAL 

Designer Reem Alkanhal in front of her eponymous label's collection. (Supplied)

This label designs clothing for women who like to express their femininity with simple elegance. The Sword collection, created for the show, “reflects this vision — merging traditional symbolism with modern sophistication for the confident, contemporary woman,” according to the catalogue. 

YASMINA Q 

Yasmina Q is a comtemporary womenwear label that seeks to create positive change through working mindfully with local communities, with a focus on knitwear. “We’re very focused on sustainably. I’m based in Saudi, we source our yarn from Italy and produce in London. Each piece we produce has zero waste,” said founder Yasmina Qanzal.  


Saudi Arabia posts 4 years of VC growth despite global slowdown: report 

Saudi Arabia posts 4 years of VC growth despite global slowdown: report 
Updated 45 min 18 sec ago
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Saudi Arabia posts 4 years of VC growth despite global slowdown: report 

Saudi Arabia posts 4 years of VC growth despite global slowdown: report 

RIYADH: Saudi Arabia achieved four consecutive years of growth in venture capital relative to its economy, a feat unmatched among its peers, according to a new report.

Between 2020 and 2023, the Kingdom was the only large market in the sample to post uninterrupted annual gains in VC intensity, contrasting with the more episodic deal flow seen across Africa and parts of Southeast Asia, MAGNiTT’s recently published Macro Meets VC report stated. 

While 2024 saw a slight contraction in funding amid global tightening, Saudi Arabia’s multi-year upward trend signals a sustained commitment to innovation-led diversification.

The Kingdom is steadily consolidating its position as a model for policy-driven venture capital development in emerging markets as it seeks to diversify its economy in line with the Vision 2030 blueprint. 

“Saudi Arabia is becoming the model for long-term, policy-driven ecosystem building,” the report notes, highlighting that sovereign limited partners and local funds have been instrumental in buffering the Kingdom from some of the volatility that struck other emerging venture markets. 

Saudi Arabia’s policy momentum 

The MAGNiTT data revealed that Saudi Arabia recorded a five-year average VC-to-GDP ratio of 0.07 percent. 

Although this figure remains modest compared to more mature hubs like Singapore, its consistent upward movement underscores the growing depth of domestic capital formation. 

Beyond the headline ratios, the Kingdom’s strategic positioning has also come into sharper focus. Saudi Arabia, along with the UAE, is classified as a “Growth Market”— a designation that reflects not only a sizeable GDP and population but also the rising economic clout of local consumer and enterprise demand. 

With a GDP approaching $950 billion and a population exceeding 33 million, Saudi Arabia presents a significant scale advantage. 

According to MAGNiTT’s benchmarking, this size creates “natural expansion targets for startups moving beyond initial launch markets,” supporting both regional and international founders seeking to diversify beyond smaller ecosystems. 

MENA’s uneven progress 

Across the broader Middle East and North Africa region, venture capital activity has continued to evolve unevenly. 

The UAE has retained its reputation as a strategic innovation hub and one of the few “MEGA Markets” in the emerging world, boasting a five-year average VC-to-GDP ratio of 0.20 percent. 

This proportion — identical to Indonesia’s ratio — signifies robust venture activity relative to the economy’s size. 

Yet, while the UAE maintained this level, Saudi Arabia has seen more consistent growth in funding, a dynamic the report attributes to policy-led market development. 

In Egypt, VC has gained further traction over the period under review. Egypt achieved a 25 percent rise in total funding compared to the previous five-year average, lifting its VC-GDP ratio by 0.02 percentage points to 0.11 percent. 

Although Egypt’s overall economic constraints remain acute — GDP per capita still lags below $10,000 — the relative progress suggests improving investor confidence, particularly in fintech and e-commerce. 

However, the report cautions that deal flow in Egypt, much like in Nigeria, remains fragile and prone to episodic swings driven by a handful of large transactions. 

The macroeconomic context across MENA has also been influential. Elevated oil price volatility and the impact of the Israel–Iran conflict have created a challenging backdrop for policymakers. 

Brent crude surged more than 13 percent in a single day earlier in 2025, underscoring the region’s exposure to external shocks. 

Nevertheless, both Saudi Arabia and the UAE managed to maintain monetary policy stability in line with the US Federal Reserve’s cautious stance. 

Saudi Arabia kept its benchmark rate at 5.5 percent, supported by inflation trending around 2 percent, while the UAE held steady at 4.4 percent. 

These decisions reflected a delicate balance between containing price pressures and supporting economic diversification efforts. 

Overall, MENA’s five-year aggregate venture funding reached $12.52 billion. Although this total remains well below the levels seen in more mature regions, it represents a meaningful share of emerging markets capital. 

MENA also posted the highest deal count relative to its peers in Southeast Asia and Africa over the period, indicating a broader base of early-stage transactions even as late-stage funding remains more limited. 

The report emphasizes that expanding geographic and sectoral reach within MENA will be critical to boosting efficiency metrics. 

“VC remains heavily concentrated in a few sectors and cities,” the report observes, warning that without broader inclusion, capital intensity will struggle to match potential. 

Southeast Asia’s VC benchmark 

Beyond MENA, Southeast Asia’s ecosystem stands out as the most mature among emerging venture markets, driven primarily by Singapore’s exceptional performance. 

Over the 2020–2024 period, Singapore achieved a 5-year average VC-to-GDP ratio of 1.3 percent, surpassing not only all emerging markets but also developed economies such as the US, which registered 0.79 percent, and the UK, with 0.73 percent. 

Even with a 5.4 percent decline in total funding compared to the prior five years and a 0.19 percentage point drop in VC-GDP ratio, Singapore maintained unmatched capital efficiency. 

The report describes the city-state as “a benchmark for capital efficiency in venture ecosystems,” attributing this strength to strong regulatory frameworks, institutional capital participation, and a deep bench of experienced founders and investors. 

Indonesia, Southeast Asia’s largest economy, recorded total VC funding volumes nearly twice as large as Singapore’s over five years, but its relative VC-GDP ratio remained lower at 0.2 percent. 

This dynamic illustrates one of the report’s core findings: venture capital inflows correlate more strongly with GDP per capita than total GDP. 

In Indonesia’s case, while its GDP surpassed $1.2 trillion, GDP per capita hovered around $4,000, constraining purchasing power and, by extension, startup revenue potential. 

Thailand, meanwhile, reported funding gains due mainly to a single mega deal rather than systematic improvements in ecosystem depth. 

In Africa, Nigeria emerged as an unexpected bright spot in 2024, as a single major transaction lifted its VC-GDP ratio to 0.15 percent — the highest in the region for that year. 

However, this outlier result also revealed the episodic nature of capital deployment in developing markets. 

Kenya registered a relatively high five-year VC-GDP ratio of 0.3 percent, even as absolute funding volumes remained modest. 

The report notes that in low-GDP contexts, this ratio can overstate ecosystem maturity. 

South Africa and Egypt showed more modest growth trajectories, weighed down by persistent inflation, structural constraints, and capital scarcity. 

In aggregate, African economies continued to lag both Southeast Asia and MENA in total venture funding and deal velocity. 

Global challenges ahead 

Globally, the five years covered by the report were marked by intensifying volatility. 

High interest rates, trade tensions, and geopolitical uncertainty weighed on capital flows. 

The US Federal Reserve held its policy rate between 4.25 percent and 4.5 percent through mid-2025, citing “meaningful” inflation risks. 

The European Central Bank moved to lower its deposit rate to 2 percent, reflecting cooling inflation but acknowledging sluggish growth. 

The World Bank cut its global GDP forecast for 2025 to 2.3 percent, the weakest pace since the 2008 crisis, excluding recessions. 

These headwinds contributed to the decline in venture capital across most emerging markets in 2024. 

In response, sovereign capital and strategic investors have become increasingly important backstops. 

The report highlights that domestic capital formation in MENA has partially offset declining global risk appetite. 

However, these funds tend to be slower moving, more sector-concentrated, and less risk-tolerant than international investors. 

“Without renewed foreign inflows or regional exit pathways, deal velocity may remain muted into the second half of 2025,” the report warns. 

This environment is likely to force startups to extend runway and compel general partners to adopt more selective deployment strategies. 

Despite the challenges, the outlook for Saudi Arabia and other growth markets remains constructive over the medium term. 

The Kingdom’s policy clarity, deepening institutional capital pools, and Vision 2030 commitments create a foundation for continued expansion. 

As the report concludes: “High GDP markets like KSA and Indonesia trail in VC efficiency — suggesting capital underutilization.” 

Closing this gap between potential and realized funding will be the defining challenge for emerging ecosystems as they navigate a turbulent global landscape.