Foreign Direct Investment in UAE
According to the United Nations Conference on Trade and Development (UNCTAD) World Foreign Direct Investment Report 2019, the United Arab Emirates advanced three levels in 2018 from its ranking in 2017 to rank 27 globally in terms of its ability to attract foreign direct investment (FDI). The value of FDI inflows grew to about USD10.385 billion in 2018 from USD10.354 billion in 2017, with growth of 0.3% and an average growth rate of -1.6% during the period 2014-2018.
It was thus the first Arab country in attracting foreign direct investment accounting for 33.3% of the total value of FDI inflows to Arab countries in 2018; which amounted to USD 31.2 billion. It also ranked second in the West Asia region with 35.5% of total FDI inflows to the region and about 22.0% of total annual FDI inflows to the Middle East and North Africa region. Consequently, Total accumulative FDI inflows grew to USD140.319 billion from USD129.934 billion in 2017, with a growth rate of about 8.0% in 2018 and an average growth rate of about 8.5% during (2014-2018).
Many factors helped achieve those positive results such as the stable political climate, the sound and effective economic policies, the business-friendly legislation, the strong economic relations with various countries of the world, the important geostrategic location that helped UAE become a vital business gateway for different regional markets, the efficient government services and effective judicial system, the efficiency of financial, taxation and customs investment-stimulating systems, the modern infrastructure and technology such as highly sophisticated airports and ports, the vital and integrated logistics services sector, the infrastructure-developed and diversified free zones, the global leadership in civil aviation, the globally competitive giant air carriers, the open and multicultural society that embraces more than 200 nationalities, the modern and sophisticated lifestyle and the widespread technology and communications.
876 new foreign investment projects were established in Arab countries in 2018 at an investment cost of more than USD83.5 billion, 635 of which by the GCC countries and 16.9% of the GCC countries' incoming projects were accounted for by United Arab Emirates at an investment cost of about USD14.1 billion.
The structure of FDI in the state is well diversified and among the most important economic sectors in terms of FDI: Wholesale and retail trade, real estate activities, financial services and insurance, manufactoring, mining and quarry exploitation. Among the most important countries investing in the state are Switzerland, the United Kingdom, India, the United States, France, Austria, Japan, Saudi Arabia, Kuwait and the Netherlands.
Source: MOE Annual Economic Report 2019
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