1. The UAE ranked second globally in greenfield FDI projects in 2023, with 1,323 project announcements, showing a 33% rise compared to 2022, according to the UNCTAD 2024 World Investment Report.
2. FDI inflows into the UAE reached $30.688 billion in 2023, marking a 35% year-on-year increase, while FDI outflows decreased to $22.328 billion.
3. Key sectors driving the growth of greenfield investments included business services, software, and IT, contributing to a 7.5% rise in jobs and a 37% increase in capital inflows, according to UAE Ministry of Investment officials.
4. The UAE ranked second globally after the United States in greenfield FDI project announcements for 2023, with 1,323 projects, marking a 33% increase from 2022, according to the 2024 World Investment Report by the UN Conference on Trade and Development (UNCTAD).
5. In 2023, the UAE attracted $30.688 billion in FDI inflows, up from $22.737 billion in 2022—a year-on-year growth of 35%, according to Emirates News Agency (WAM). Meanwhile, FDI outflows totaled $22.328 billion, down from $24.833 billion in 2022. The UAE’s FDI outflow stock increased to $262.208 billion in 2023 from $239.880 billion the previous year.
6. The UAE also climbed two spots in the global ranking of top destinations for greenfield projects after entering the top five in 2022. The UAE attracted around 60% of the total FDI into the Gulf Cooperation Council (GCC), which more than doubled to $37 billion, according to UNCTAD.
7. Mohammed Abdul Rahman Al Hawi, Under-Secretary of the UAE Ministry of Investment, stated that the key drivers of greenfield investment growth in 2023 were business services, software, and IT sectors, which generated significant job creation and capital inflows. Other sectors, including financial services, industrial equipment, transportation, and warehousing, also played pivotal roles in this growth.
8. “These investments led to a 7.5 percent rise in total jobs created, along with a 31 percent increase in the number of announced projects, and a 37 percent rise in announced greenfield Foreign Direct Investment (FDI) capital inflows,” Al Hawi told Emirates News Agency (WAM).
STRATEGIC REFORMS AND TRADE AGREEMENTS FUELING UAE’S FDI AMBITIONS
1. The remarkable growth in greenfield FDI in the UAE for 2023 can be attributed to a confluence of strategic regulatory reforms and ambitious trade agreements. The introduction of regulatory reforms, including the allowance of 100% foreign ownership in specific sectors, enhanced intellectual property protections, and streamlined licensing procedures, has significantly bolstered the UAE's appeal to international investors. These changes have not only facilitated ease of doing business but have also instilled confidence among foreign investors regarding the protection of their investments.
2. Moreover, the substantial increase in the value of goods exported from the UAE, which saw a 37% rise between 2019 and 2022, underscores the country's expanding role in global trade. This growth is further supported by the UAE's proactive approach in signing Comprehensive Economic Partnership Agreements (CEPAs) with several countries, including India, Cambodia, Israel, Indonesia, and Turkey, while also engaging in ongoing negotiations with at least 16 other countries. Such agreements have enhanced trade relations and opened new markets for the UAE, contributing to a more favorable environment for FDI.
3. In summary, the UAE's strategic regulatory reforms and aggressive trade diplomacy have played pivotal roles in attracting FDI, positioning the country as a leading destination for investment. The synergy between improved investment conditions and robust trade partnerships has not only accelerated economic growth but also promises to sustain the momentum of FDI inflows into the future and achieve the goal of USD 150bn in FDI Inflows by 2031.
Source:
https://waya.media/uae-sees-33-surge-in-greenfield-fdi-capital-inflows-in-2023/
https://www.emiratesnbdresearch.com/-/media/uae-fdi-report-2023.pdf
