Foreign direct investment in the UAE

Foreign direct investment in the UAE

Foreign investments are considered one of the most important sources of investment at the macroeconomic level, and constitute a real addition to the gross product in any country, while foreign direct investment is characterized by the fact that it seeks to obtain a permanent interest in an institution residing in another economy, and includes a long-term relationship between the direct investor and the institution, with the enjoyment of... The investor has a significant degree of influence in the management of the enterprise.

The United Arab Emirates ranks first in the Arab world and nineteenth globally in attracting foreign direct investment, according to the UNCTAD report for 2022. The UAE attracted foreign direct investment worth $20.7 billion in 2021, with a growth rate of 4% compared to 2020. The UAE accounts for 40% of incoming investments. To Arab countries, it ranks fifth globally in the number of new foreign direct investment projects announced in 2021.

The oil, gas and energy sector occupies a large proportion of the investments coming into the country, as it constitutes 59% of total investments, followed by the technology and communications sector with a percentage of 10%, and the financial sector with a percentage of 7%.
It is clear from these numbers that various economic sectors play an important role in attracting investments and achieving economic development. The following table shows the foreign direct investment index (net inflows) as a percentage of GDP during the period (2016_2020):

The ratio the year
2.70% 2016
2.70% 2017
2.50% 2018
4.30% 2019
5.50% 2020

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