UAE IS THE FIRST IN ARAB WORLD AND 19TH GLOBALLY IN ATTRACTING FOREIGN DIRECT INVESTMENT

  • 23/06/2022

Dubai: The United Arab Emirates ranked first in the Arab world and 19 globally, in terms of its ability to attract foreign direct investment, according to the World Foreign Direct Investment Report for the year 2022 issued by the United Nations Conference on Trade and Development "UNCTAD" .


The country ranked 17th globally in outward investment flows to countries of the world, with a total of $22.5 billion, with a growth rate of 19% over the year 2020.

In this context, His Excellency Abdullah bin Touq Al Marri, Minister of Economy, said that the positive results and indicators mentioned in the report confirming that the UAE is moving steadily towards achieving its ambitious goals of strengthening the national economy and ensuring its global competitiveness, in light of the support and directives of the wise leadership, and in line with the objectives of The principles of the fiftieth and the determinants of the UAE Centennial 2071, stressing that the national efforts to develop the attractiveness of the investment environment in the country and to create the potentials for growth for investment inside and outside the country are continuous efforts in accordance with integrated national plans aimed at consolidating the country's position on the global investment map.

His Excellency added that the progress documented in the report is added to the series of achievements that the UAE has achieved recently thanks to the vision and directives of its wise leadership, starting with its rapid recovery from the effects of the Covid-19 pandemic, and its achievement of the highest growth in the region in its gross domestic product, at a rate of 3.8%. Through its launch of the fifty projects and the integrated strategic initiatives that aim to advance the process of internal and external growth of the country in accordance with ambitious goals and a long-term development path, all of which serve to increase the attractiveness of the investment environment in the country, while at the same time enabling and developing Emirati investments issued to all markets of the world,

For his part, His Excellency Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, said that the investment environment in the UAE is achieving successive developments in light of the support and directives of the wise leadership, stressing that the report reflects the high and increasing competitiveness achieved by the Attractive investment climate in the UAE, thanks to legislation and laws The flexible state introduced by the state in light of the objectives and principles of the fifty, and the transformational initiatives that contributed to the development of investments in the state, most notably the provision of 100% foreign ownership of investments and projects,

The report, which monitors the results of foreign direct investment for the year 2021 in the countries of the world compared to 2020, indicated that the UAE attracted foreign direct investment in 2021 amounting to $20.7 billion, with a growth rate of 4% over the year 2020, topping the Arab world with 40% Of the total foreign direct investment flowing to the group of Arab countries, which amounted to 52.9 billion US dollars.

The incoming investments to the state included many vital economic sectors and activities, as the oil, gas and energy sector accounted for 59% of the total foreign direct investments incoming to the state, followed by the information and communications technology sector with 10%, and the banking, financial and insurance services sector attracted 7% of the total, compared to 7% also for the real estate sector and management and development activities, 6% for the healthcare sector, and 5% for the manufacturing sector.

Many sectors witness a growth in attracting foreign direct investment during 2021 compared to 2020, at varying rates, as the manufacturing sector achieved the largest growth jump during the comparison period by 13%, while the health sector achieved a growth of 9%, and the Communications and technology sector grew by 6%, while the real estate sector witnessed a growth of 4%, energy 3%, and services 2%.

In addition, the UAE ranked first in the West Asia region, accounting for 37% of the total inflows to the region, amounting to 55.5 billion dollars, and also ranked first in the Middle East and North Africa, accounting for about 31% of the total inflows Foreign direct investment received in this region, amounting to 66.6 billion dollars.

According to the report, the cumulative balance of foreign investment incoming to the country at the end of 2021 amounted to a total of 171.6 billion dollars, achieving a growth rate of 14% compared to the balance in 2020, which amounted to about 151 billion dollars at the time.

The report indicated that the UAE ranked fifth globally in the number of new foreign direct investment projects announced by destination in 2021 with 535 projects, which will witness a 39% increase compared to the number of projects at the end of 2020, which amounted to 384 projects , and the report cited with a solar energy project announced in Dubai in 2021 for $633 million, by Germany's DHL Global Forwarding and France's Total.

The report emphasized that the UAE was among the top six harvested within the group of developing countries in Asia, in which incoming flows are still highly concentrated, and includes China, Hong Kong, Singapore, India and Indonesia.

With regard to issued investments, the report indicated that the cumulative balance of foreign investment issued by the state amounted to more than 215 billion dollars by the end of 2021, achieving a growth rate of 11.7 percent compared to the balance of 2020, which amounted at the time to a total of 192.5 billion dollars.

The UAE accounted for more than 40% of the total outbound flows from West Asia, amounting to approximately $56 billion, and about 40% of the total outbound flows from the Middle East and North Africa region, and more than 43% of the total outbound flows from Arab countries to the world. amounting to 51.9 billion US dollars.

In this regard, the report pointed to a new project by the UAE company GlobalFoundries worth $4 billion, which was announced as one of the new projects to build a chip-making plant in Singapore, in addition to the purchase by DP World of Syncreon NewCo , a provider of long-distance trucking services, for $1.2 billion. .

He touched on the measures taken by the state through the launch by the Abu Dhabi government of the virtual license that allows non-resident foreign investors to obtain an economic license to conduct business in Abu Dhabi without any prior residency procedures and from anywhere outside the United Arab Emirates. In order for governments in both developed and developing to intensify their efforts to support the growth of sustainable finance by developing the necessary policies and regulatory frameworks, the report indicated that the UAE was among the group of countries that covered a number of key areas of sustainable finance policy such as the framework and national guidelines, and the field of Sustainability disclosure.

At the global level, the UNCTAD report confirmed the recovery of global flows of foreign direct investment to pre-pandemic levels last year to reach $1.6 trillion, an increase of 64%, and it is expected that this recovery will continue in the world during the current year, but the recovery of investment in new areas in the industry It remains fragile, especially in developing countries, and this fragile growth of real productive investment is likely to continue into 2022.

According to the report, the United States remained the largest recipient of foreign direct investment with $367.3 billion, an increase of 143% over the year 2020. The increase in corporate profits had a direct impact on reinvested profits, which rose to a record level of $200 billion. In addition, investments rose Shares increased by 54%, reflecting a sharp increase in cross-border mergers and acquisitions. Also, announcements of new founding projects increased by 28% to reach $86 billion.

China dollars ranked second in the world, with total inflows of about 181 billion dollars, an increase of 21% from 2020, and Hong Kong in third place with a volume of incoming flows of about 141 billion, an increase of 4%.

The report pointed out that foreign direct investment flows to developing countries in Asia rose by 19% to $619 billion in 2021, as flows continued to grow for the third year in a row, which confirmed the resilience of the developing economy in Asia, especially during the pandemic period, and China was the main beneficiary. , followed by Hong Kong, Singapore, India, the United Arab Emirates and Indonesia.

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