The United Arab Emirates has secured a record-breaking $16 billion in greenfield foreign direct investment (FDI) for the year 2023, reflecting the nation’s growing appeal as an investment destination and its commitment to global economic partnerships. The figure, confirmed by Mohammed Abdul Rahman Al Hawi, Under-Secretary of the UAE Ministry of Investment, underscores the country’s strategic focus on economic diversification and resilience.
The largest contributors to the UAE’s greenfield FDI inflows were major economies, including the United States, India, the United Kingdom, Saudi Arabia, and France. These investments underscore the UAE’s position as a premier destination for global investors, with Al Hawi emphasizing that “the UAE is actively pursuing international partnerships to enhance its global economic presence.”
Sectoral Focus on Economic Diversification
Al Hawi pointed out that five critical sectors have been instrumental in driving the surge in greenfield FDI, aligning with the UAE’s economic growth strategy to strengthen its resilience and sustainability. The business services, software, and IT services sectors led the charge, creating substantial employment opportunities and attracting significant capital. Additional sectors such as financial services, industrial equipment, and transportation and warehousing have also contributed considerably to the UAE’s greenfield FDI growth.
These strategic sectors together account for 86% of the nation’s total FDI stock, reflecting the UAE’s targeted approach to building a diversified and resilient economy. “These investments led to a 7.5% rise in total jobs created, along with a 31% increase in the number of announced projects, and a 37% rise in announced greenfield Foreign Direct Investment (FDI) capital inflows,” Al Hawi highlighted.
With over 1,300 projects announced, the UAE expects the creation of approximately 50,000 new jobs as a direct outcome of these investments, bolstering the country’s labor market and economic potential.
Strategic Partnerships to Strengthen Global Economic Ties
In a bid to solidify its position on the global economic stage, the UAE has been proactive in signing Comprehensive Economic Partnership Agreements (CEPAs) with key international players. Agreements have been finalized with countries like India, Turkiye, and Indonesia, designed to enhance trade, investment, and overall economic cooperation. “These agreements aim to boost trade, investment, and economic cooperation,” Al Hawi added.
Beyond CEPAs, the UAE has entered into 115 bilateral investment treaties and 146 double taxation agreements with nations worldwide. These treaties are crafted to protect cross-border investments and prevent double taxation, thereby encouraging smoother and more attractive investment flows. Al Hawi noted, “These treaties are also a testament to the UAE’s strategic approach in positioning itself as a leading global hub for trade and investment.”
A Leading Global Hub for Greenfield Investment
The Under-Secretary of the Ministry of Investment emphasized that the UAE’s active greenfield investment landscape is a crucial factor in its economic growth trajectory, driving job creation and capital inflows. “The UAE’s vibrant greenfield investment landscape continues to be a major driver of economic growth, job creation, and capital inflows, solidifying its reputation as a global investment hub,” he stated.
With a robust foundation in greenfield investments, the UAE is poised to maintain its trajectory as a primary investment destination for global economies, fostering international economic cooperation and laying the groundwork for sustainable growth.
