RABAT, May 11, 2025 (AFP) - The state-run French Development Agency (AFD) will invest $168-million in the largely Moroccan-controlled but disputed territory of Western Sahara, the agency's chief said Saturday.

"The AFD group will now invest in the southern regions and provide investments and financing," AFD chief executive Remy Rioux said in a statement carried by official Moroccan news agency MAP during a visit to the territory.

Western Sahara, a mineral-rich former Spanish colony, is largely controlled by Morocco but has been claimed for decades by the pro-independence Polisario Front, which is backed by Algeria.

The United Nations considers Western Sahara a "non-self-governing territory".

A UN peacekeeping mission based there since 1991 has the stated aim of organising a referendum on the territory's future. But Rabat has repeatedly ruled out any vote where independence is an option, instead proposing an autonomy plan.

France's stance on Western Sahara has been ambiguous in recent years, often straining ties with Morocco.

But last year, French President Emmanuel Macron said Morocco's autonomy plan was the "only basis" to resolve the conflict.

France's diplomatic turnabout had been awaited by Rabat, after the United States recognised Moroccan claims over Western Sahara in return for the kingdom normalising ties with Israel in 2020.

The shift drew criticism from Algiers, which cut diplomatic ties with Morocco in 2021.