UAE Achieves Significant Milestone in Foreign Direct Investment
The United Arab Emirates (UAE) has reached a remarkable position in the global investment landscape, securing the status of the world’s 10th largest recipient of foreign direct investment (FDI) for 2024. The nation attracted a staggering AED 167.6 billion (approximately $45.6 billion) in FDI inflows, as stated in the United Nations Conference on Trade and Development (UNCTAD) World Investment Report 2025.
A Remarkable Year-on-Year Growth
This year marks an impressive 48% increase in foreign direct investment compared to the previous year, reinforcing the UAE’s reputation as a premier destination for global capital. Notably, the UAE accounted for 37% of all FDI inflows within the Middle East region, highlighting its significant influence in attracting international investment.
Sheikh Mohammed bin Rashid Al Maktoum, the UAE’s Vice President, Prime Minister, and Ruler of Dubai, characterized this achievement as “an international vote of confidence” in the UAE’s economic potential. He emphasized the growth stats, detailing that the country received AED 167 billion in FDI, emphasizing a commitment to increasing that number in the future.
Leading the Region in Investment Initiatives
The statistics reveal that for every $100 invested in the Middle East, $37 flows into the UAE, placing it second globally only to the United States in the number of newly announced FDI projects. Sheikh Mohammed outlined an ambitious target to attract AED 1.3 trillion (around $354 billion) in foreign direct investment over the next six years.
This determination demonstrates the UAE’s stable foundation and commitment to sustainable economic development, underscoring the importance it places on fostering an investment-friendly environment.
A Focus on Greenfield Projects
The UAE also excelled in newly announced greenfield FDI projects, coming in second worldwide with 1,369 new initiatives worth AED 53.3 billion ($14.5 billion). In a climate of global slowdown, where the growth rate for greenfield projects is just 0.8%, the UAE managed to achieve a growth rate of 2.8%.
Key Sectors Attracting Investments
Several sectors have shown particularly strong performances in attracting greenfield FDI in 2024:
- Software and IT Services: 11.5%
- Business Services: 9.7%
- Renewable Energy: 9.3%
- Oil, Gas, and Coal: 9%
- Real Estate: 7.8%
The energy sector alone welcomed AED 4.8 billion ($1.3 billion), contributing to the UAE’s goal of tripling its renewable energy capacity by 2030.
Sustained Growth in Cumulative FDI
As of 2024, the UAE’s cumulative FDI stock reached $270.6 billion, achieving a compound annual growth rate of 10.5% since 2015. This growth trajectory underscores the UAE’s commitment to becoming a global hub for investment.
Mohamed Hassan Alsuwaidi, the UAE’s Minister of Investment, lauded the record levels of FDI inflows as a testament to the strategic vision implemented by the nation’s leadership. He emphasized the Ministry’s commitment to enhancing regulatory frameworks that support investor needs, thus ensuring a conducive business environment.
Strategic Investment Framework
The UAE’s investment ecosystem is lauded as a global model due to its stability, transparency, trade openness, and an efficient business culture. With the National Investment Strategy 2031, the UAE aims to solidify its standing as a top FDI destination, targeting AED 2.2 trillion ($599 billion) in cumulative FDI by 2031. This strategy emphasizes sectors like advanced manufacturing, renewable energy, financial services, and information technology.
Attracting Talent and Innovation
The UAE’s appeal as an investment hub is further reinforced by its policies that allow full foreign ownership of mainland companies, a low corporate tax rate of 9%, and streamlined licensing processes. Furthermore, the country sustains 21 Comprehensive Economic Partnership Agreements and 120 bilateral investment treaties, enhancing its global connectivity.
According to INSEAD’s Global Talent Competitiveness Index 2024, the UAE ranks fifth globally in attracting talent and third in attracting AI talent, as per Stanford University’s AI Index 2024. The recent $1.5 billion AI joint venture between Microsoft and Abu Dhabi-based G42 emphasizes the UAE’s growing role in digital transformation and innovation.
In summary, the UAE’s impressive standing in foreign direct investment not only highlights its strategic positioning on the global investment landscape but also reflects its commitment to nurturing a sustainable and diversified economy, making it a pivotal player in the future of international business.
