The Middle East and North Africa are positioning themselves as major producers of green hydrogen and hydrogen-derived fuels, while Chinese manufacturers are increasingly supplying the electrolysers needed to turn abundant renewable energy into clean molecules. At the same time, Europe is developing policies and infrastructure to import renewable hydrogen, green ammonia and other derivatives as it seeks to decarbonise heavy industry. The emerging model raises a strategic question: could the future supply chain effectively see green hydrogen made in MENA, built using Chinese technology and ultimately sold into European markets? Recent investment, manufacturing and policy developments suggest the foundations of such a trade are already taking shape, although major challenges remain over cost, certification, financing, transport and European industrial policy.
Why is MENA becoming a major green hydrogen region?
The MENA region has several characteristics that make it attractive for large-scale renewable hydrogen production. Countries including Saudi Arabia, Oman, the United Arab Emirates, Egypt and Morocco have significant solar and wind resources, access to industrial sites and ports, and governments seeking new sources of investment and export revenue.
The scale of the project pipeline is substantial. A 2026 regional energy outlook identified 127 active hydrogen projects across MENA, with more than 95% focused on green hydrogen. Morocco, Egypt, Jordan, the UAE, Oman, Saudi Arabia and Mauritania are among the countries pursuing projects at different stages of development. However, the majority remain in planning, feasibility or early development rather than commercial operation.
Saudi Arabia provides one of the clearest examples of the region’s ambitions. The NEOM Green Hydrogen Company says its $8.4 billion project is approaching final construction completion, with commissioning under way and product availability expected in 2027. The facility is designed around 4GW of solar and wind generation and will produce green hydrogen for conversion into green ammonia for export.
Oman is also developing an export-oriented hydrogen industry, while Egypt is seeking to use its renewable resources, industrial base and position around the Suez Canal to attract hydrogen and ammonia investments.
Why is China becoming important to the MENA hydrogen supply chain?
The answer lies largely in the cost and scale of China’s electrolyser industry. Electrolysers use electricity to split water into hydrogen and oxygen, making them one of the central pieces of infrastructure in a green hydrogen plant.
The International Energy Agency said global installed electrolysis capacity more than doubled in 2025 to above 4GW, with China accounting for nearly three-quarters of new installations. China also has around 60% of global electrolyser manufacturing capacity, giving its companies a significant position in the emerging supply chain.
That industrial advantage is increasingly translating into overseas sales. Hydrogen Insight reported that Chinese manufacturers delivered at least 321.25MW of electrolysers to overseas projects during the first half of 2026, compared with 18.5MW in the same period of 2025. The deliveries included major equipment supplied to an ACME green hydrogen and ammonia project in Oman.
For MENA developers, competitively priced Chinese equipment can potentially reduce capital costs and accelerate construction. For Chinese manufacturers, overseas projects provide an important outlet as competition and surplus manufacturing capacity put pressure on margins in the domestic market.
Could Chinese electrolysers help make MENA hydrogen competitive in Europe?
Potentially, although equipment costs are only one part of the equation. Green hydrogen production requires large amounts of renewable electricity, extensive transmission and storage infrastructure, water supplies, electrolysers and facilities to convert hydrogen into transportable products such as ammonia or methanol.
European buyers also face strict rules over what qualifies as renewable hydrogen. Certification, emissions accounting and traceability can determine whether an imported product qualifies for European markets and associated incentives.
Cost remains another major obstacle. The EU Agency for the Cooperation of Energy Regulators estimated that renewable hydrogen produced through electrolysis in the Netherlands was around €7 per kilogram in October 2025, while renewable-fuel-of-non-biological-origin hydrogen was estimated at roughly €8 per kilogram. Conventional hydrogen produced from natural gas remained substantially cheaper.
MENA’s renewable resources could help narrow that gap, particularly where solar and wind power can be generated at competitive costs. However, the eventual delivered price in Europe will also include conversion, shipping, storage, certification and other infrastructure costs.
Why does Europe want hydrogen from outside the continent?
Europe’s hydrogen strategy is closely linked to industrial decarbonisation. Hydrogen can replace fossil fuels in sectors where direct electrification is difficult, including steelmaking, chemicals, refining, shipping fuels and some high-temperature industrial processes.
Yet European production faces challenges, including high electricity costs and slow project development. The IEA says the first large-scale European hydrogen projects are expected to come online in 2026, but policy implementation has been slower than initially anticipated.
That creates a potential role for imports. Countries close to Europe, particularly in North Africa, can offer geographical advantages, while Middle Eastern producers can access large renewable-energy resources and existing export infrastructure.
The European Union has already established hydrogen partnerships with countries such as Egypt. Its strategic partnership with Egypt on renewable hydrogen was first agreed in 2022, reflecting the bloc’s longer-term interest in developing supply chains with neighbouring producer countries.
Does this mean Europe could become dependent on Chinese technology?
That is one of the emerging strategic concerns. Chinese manufacturers have achieved significant economies of scale, but European policymakers are also trying to protect domestic clean-technology industries.
The issue extends beyond hydrogen. European officials and industrial leaders have watched the decline of domestic solar-panel manufacturing as Chinese producers gained a dominant global position. Similar concerns are now appearing in the electrolyser market.
European industry executives warned in 2026 that the continent risks losing its emerging green hydrogen industry to China without stronger support for European manufacturers. The debate includes proposals favouring European-made equipment in publicly supported projects.
At the same time, European demand for low-carbon hydrogen could be difficult to satisfy quickly using only European-made equipment. Chinese technology may therefore remain attractive to overseas developers even as European governments seek greater supply-chain resilience.
Which MENA projects could shape the emerging market?
Saudi Arabia’s NEOM project is among the most significant. Its planned production and export model illustrates how MENA countries intend to turn renewable electricity into a globally traded commodity. The project is expected to begin making its product available in 2027.
Oman is developing another important export market. Chinese electrolyser supplier Sungrow Hydrogen supplied 160MW of alkaline electrolysers to ACME for a 300MW green hydrogen and ammonia project in Oman during the first half of 2026, according to Hydrogen Insight’s analysis of publicly available data.
Morocco is also advancing projects aimed at producing green ammonia and industrial fuels. In February 2026, TAQA Morocco and Moeve announced a preliminary land reservation agreement under Morocco’s Green Hydrogen Offer. The proposed development includes renewable-energy production in the Dakhla region and e-fuels production and marketing linked to the port of Jorf Lasfar.
These projects show that the MENA hydrogen story is not limited to exporting pure hydrogen. Green ammonia, methanol and synthetic fuels may be more practical commodities for international shipping and long-distance trade.
What are the biggest obstacles to the MENA-Europe hydrogen trade?
The biggest obstacle is that a large announced project pipeline does not automatically translate into commercial production. Financing, offtake agreements, renewable-power availability, water supply, infrastructure and regulatory certainty all affect whether projects reach final investment decisions.
The IEA has highlighted uncertainty over future demand, regulation, certification and infrastructure as major barriers. It also notes that access to low-cost finance can be particularly difficult in emerging economies.
Transport presents another challenge. Hydrogen is difficult and expensive to ship directly, which is why many export projects are considering derivatives such as ammonia. Europe must then have suitable terminals, storage facilities and industrial consumers capable of converting or using those products.
There is also the question of whether European buyers will accept equipment manufactured in China. Rules attached to public subsidies and industrial-policy measures could influence procurement decisions and potentially raise costs for projects that rely on Chinese technology.
What happens next for green hydrogen made in MENA?
The next stage will depend on which projects secure financing, sign binding offtake agreements and move from announcements to construction and operation. Developments in Saudi Arabia and Oman will be particularly important because they can demonstrate whether large-scale MENA production can operate commercially and serve international markets.
China’s expanding electrolyser exports will also remain a key factor. The sharp increase in overseas deliveries during the first half of 2026 suggests Chinese manufacturers are moving aggressively into international markets.
For Europe, the strategic balance will be more complicated. The continent needs affordable low-carbon hydrogen to decarbonise industry, but it also wants to maintain domestic manufacturing capacity for critical clean technologies.
The emerging MENA-China-Europe model therefore reflects more than a simple energy trade. It could become a new form of industrial interdependence, combining MENA’s renewable-energy potential, China’s manufacturing scale and Europe’s demand for low-carbon industrial fuels. Whether that model develops into a major commercial supply chain will depend on costs, certification, infrastructure and political decisions made over the next several years. Readers should continue monitoring project financing, electrolyser procurement, European import rules and long-term offtake agreements, as these will provide the clearest indication of whether the green hydrogen ambitions now being announced can become a functioning international market.
