The Investment in UAE made by Canadian investors has witnessed a threefold increase, reaching C$9B ($6.8B) in the past two years. As both nations forge stronger trade and economic connections, expectations to drive a continued surge in investment continues.
The Consul General of Canada in Dubai highlighted that the UAE’s position as a rapidly expanding economic, commercial, and trading centre in the region has been a driving factor behind this growth. Notably, investment from Canada in the UAE amounted to C$3.1B in 2020.
Key Investments by CDPQ and Brookfield Asset Management, Investors count on COP28
Canadian investment in the UAE has experienced significant growth, with notable contributions from major investors such as the pension fund Caisse de Depot et Placement du Quebec (CDPQ).
CDPQ has invested $5B in three key assets of DP World in the UAE, namely Jebel Ali Port, Jebel Ali Free Zone, and the National Industries Park. DP World and CDPQ will form a new joint venture, with CDPQ acquiring a 22 percent stake in these Dubai-based assets through a $2.5 billion investment.
This landmark deal has positioned Canada as the most significant investor in Dubai in 2022, accounting for 41 percent of the emirate’s foreign direct investment inflows. Another prominent investor, Brookfield Asset Management, has also expanded its presence in the UAE by acquiring financial services assets.
Looking ahead, the Consul General of Canada in Dubai foresees further expansion in investments, with Canadian companies showing increasing interest in the UAE’s sustainability, decarbonization, and energy transition sectors. These areas are expected to attract more Canadian investments as bilateral ties between Canada and the UAE continue to strengthen.
The upcoming hosting of the Cop28 summit in Dubai by the UAE has presented new investment opportunities for Canadian companies. The theme of sustainability at the summit is expected to spur further investment, and announcements in this regard can be anticipated.
Future Outlook and Opportunities for Canadian Investors
In addition to the focus on sustainability, Canadian investors are attracted to the UAE due to its strong economic rebound from the pandemic-induced slowdown. The country’s non-oil economic growth momentum, coupled with its status as a regional hub, adds to its appeal. The UAE’s economy witnessed a robust gross domestic growth of approximately 7.6 percent last year, the highest in 11 years, following a 3.9 percent expansion in 2021. Projections from the UAE Central Bank indicate growth rates of 3.3 percent in 2023 and 4.3 percent in 2024.
The combination of the Cop28 summit, the UAE’s economic recovery, and its position as a thriving regional hub have created a favourable environment for Canadian investors, resulting in increased interest and potential for further investment in the country.
Currently, there are over 150 Canadian businesses that have established operations in the UAE, with some utilizing the country as a base for global exports and re-exports.
Notably, Canada boasts the position of being the largest exporter of lentils worldwide, and several Canadian companies actively import pulses to the UAE. They process these pulses locally and subsequently re-export them to over 70 countries. The mutual interest between the UAE and Canada extends beyond Canadian investments in the UAE.
UAE investors are equally keen on solidifying their presence in Canada. For instance, Abu Dhabi’s clean energy company, Masdar, is among the latest entities exploring investment opportunities in the G7 economy. This demonstrates the reciprocal nature of investment and economic cooperation between the two countries, reflecting the growing bilateral ties and shared interests.
