The Foreign Direct Investment (FDI) into the UAE stood at $20.7 billion registering a growth of 3.9% in 2021 compared with the previous year. With this, the country’s total FDI rose to $171.6 billion by the end of 2021. Over the past ten years, FDI inflows into the country have grown by 116%, while the total balance of those investments during the same period grew by 113%.
According to Minister of Economy Abdullah bin Touq Al Marri said that the growth in FDIs has proved the strength and flexibility of the UAE’s economy and the attractiveness of its business and investment environment once again, highlighting the advantages it offers to the global investment community.
“These integrated and pioneering competitive advantages and incentives consolidate the UAE’s position as an economic and commercial capital both regionally and globally, making it a preferred and attractive destination for FDI and pioneering projects from various international markets,” he explained.
He further said: “This result is a natural outcome of the pioneering measures and initiatives implemented by the UAE in the past phase to develop its economic sectors and significantly enhance its investment climate. These policies align with a new economic model that is more flexible and sustainable, with more openness to global markets, and are also in line with future economic trends and emerging technologies.”
He said that the most prominent among them is the granting of 100% foreign ownership of projects and investments in all economic sectors, with the exception of a limited number of activities with a strategic impact. Another notable initiative is the launch of the ‘Projects of the 50’, which include several strategic and qualitative initiatives to attract pioneering projects and talents.
“We will continue our efforts in this direction during the next stage, following the UAE’s recent hosting of the Investopia summit that strengthened its position as a destination for future investments. It has set forth the goal to attract $149 billion worth foreign investments to the country by 2030, to eventually reach $270 billion by 2051,” the Minister added.
Across Various Sectors
The foreign investments received by the UAE are spread across all sectors and vital economic activities, such as traditional and renewable energy, oil and natural gas, financial sector, insurance activities, real estate, health, industry and agriculture.
Various new economic sectors such as digital economy, technology, innovation, artificial intelligence, Internet of things and blockchain, innovative medical technologies, high-speed transportation, virtual and augmented reality, robotics and self-driving cars also attracted considerable FDI.
Meanwhile, the UAE’s outward FDI flows reached nearly $22.48 billion in 2021, with an annual growth of 19.1%. They grew by 789% over the past ten years, which led to an increase in the UAE’s investments in foreign markets to reach nearly $226.3 billion by the end of 2021, with a growth of 11.1% compared to the end of 2020.
Not a Coincidence
Minister of State for Foreign Trade Dr. Thani bin Ahmed Al Zeyoudi underlined that the position occupied by the UAE in the global indicators for attracting and exporting FDI is not a coincidence, but rather the result of a clear vision adopted by the UAE’s wise leadership to enhance the country’s position as a major hub on the global investment landscape.
This is reflected in the UAE’s policies to develop FDI, as the country is keen to formulate strategies that enhance its leadership in attracting talent and qualitative investment. These efforts in turn support development plans based on innovation, knowledge, technology and the digital economy, in accordance with the principles and Projects of the 50 and the determinants of the UAE Centennial 2071.
Dr. Al Zeyoudi further said that the growth achieved by the country in attracting FDI reflects the confidence of the international community in its investment environment. He noted that it confirms the efficiency of the trade and investment openness policies pursued by the country, as the UAE now enjoys more opportunities to attract investments.
In terms of its ability to attract FDI, the UAE has climbed nine places and was ranked 15th globally in 2020 compared with 2019. At the same time, stood first in the Arab world and it gained six places globally in terms of outward FDI flows, according to UNCTAD’s World Investment Report 2021.