Despite the decline in the global foreign direct investment (FDI) in 2023, the UAE achieved a 35 per cent jump in FDI flows last year, amounting to about Dh112 billion.
The UAE ranked second globally after US, in terms of new foreign direct investment projects in 2023, and first in the Arab world, West Asia, and the Middle East in both inbound and outbound investments. Overall, the country is a now ranked 11th globally in terms of foreign investments, which is on course with the government’s target by 2030.
This was highlighted in a post on X on Friday by Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of UAE, and Ruler of Dubai. He reacted on the World Investment Report 2024 issued by United Nations Conference on Trade and Development (UNCTAD) on Thursday.
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According to UNCTAD report, which covers more than 200 economies worldwide, global FDI fell by 2 per cent to $1.3 trillion in 2023, “amidst (global) economic slowdown and rising geopolitical tensions.”
The report noted the decline would have been 10 per cent “when excluding a few European conduit economies that registered large swings in investment flows”.
FDI flows to developing countries dropped 7 per cent to $867 billion and tight financing conditions led to a 26 per cent fall in international project finance deals.
“Crises, protectionist policies and regional realignments are disrupting the world economy, as well as fragmenting trade networks, regulatory environments and global supply chains, noted the report.
UNCTAD, however, noted modest growth this year remains possible, despite prospects for 2024 remain challenging, The slight growth will be brought about by “easing financial conditions and investment facilitation efforts in both national policies and international agreements.”
World invests in UAE
In his tweet, Sheikh Mohammed said in Arabic: “Many around the world are betting on the UAE with their investments, talents and their wealth. We tell them: Whoever bets on us, we will bet on them. God willing, we will continue to create the best investment environment in the world.”
UNCTAD noted “investments are growing in several global value chain-intensive manufacturing sectors like automotive and electronics in regions and countries with easy access to major markets.
“But many developing countries remain marginalised, struggling to attract foreign investment and participate in global production networks,” the UN agency added.
UNCTAD called for countries to promote investment “by creating a transparent and streamlined environment through business facilitation and digital government tools.”
It also asked institutional investors “to boost FDI flows to infrastructure projects, especially in developing countries, to support long-term economic growth and stability.