UAE FDI balance exceeds USD 171.6 billion with a growth of 13.7 percent
The foreign direct investment (FDI) inflows to the UAE recorded a 3.9 percent growth in 2021 compared to 2020 to reach nearly USD 20.7 billion. As a result, the total FDI balance in the country increased to reach nearly AED 630 billion (USD 171.6 billion) by the end of 2021, highlighting a 13.7 percent growth over 2020. Over the past ten years, FDI inflows into the country have grown by 116 percent, while the total balance of those investments during the same period grew by 113 percent.
According to H.E. Abdulla Bin Touq Al Marri, UAE Minister of Economy, UAE’s recent hosting of the Investopia summit strengthened its position as a destination for future investments. It has set forth the goal to attract AED 550 billion worth foreign investments to the country by 2030, to eventually reach AED 1 trillion by 2051.
The foreign investments received by the UAE are spread across all sectors and vital economic activities, such as traditional and renewable energy, oil and natural gas, financial sector, insurance activities, real estate, health, industry and agriculture. Various new economic sectors such as digital economy, technology, innovation, artificial intelligence, Internet of things and blockchain, innovative medical technologies, high-speed transportation, virtual and augmented reality, robotics and self-driving cars also attracted considerable FDI.
Meanwhile, the UAE’s outward FDI flows reached nearly AED 82.6 billion (AED 22.5 billion) in 2021, with an annual growth of 19.1 percent. They grew by 789 percent over the past ten years, which led to an increase in the UAE’s investments in foreign markets to reach nearly AED 830.5 billion (USD 226.3 billion) by the end of 2021, with a growth of 11.1 percent compared to the end of 2020.
The UAE’s investments have proven highly efficient in regional and international markets, and in various vital economic sectors, where they serve as qualitative and sustainable strategic investments. The UAE companies have been able to enhance the competitiveness of the national economy in a number of advanced global industries and services such as aviation, transportation and mining, in addition to the great progress they have made in the field of conventional and renewable energy. In addition, they also perform well in real estate and construction sectors, ICT, oil and natural gas, logistics, ports and infrastructure, tourism, hotels and entertainment sector, banking and agriculture.
In terms of its ability to attract FDI, the UAE advanced by nine ranks in 2020 compared to 2019 and ranked 15th globally. At the same time, it advanced six positions globally in terms of outward FDI flows to rank first in the Arab world and 13 globally, according to UNCTAD’s World Investment Report 2021.
The UAE also ranked first in the Arab world and 15th globally in the Kearney's FDI Confidence Index for the year 2021, advancing four places compared to the year 2020, thus outperforming a number of major global economies such as Singapore, Australia, Portugal, Denmark, Ireland, Brazil and Finland in the general ranking of the index.