UAE attracted over $75bn in FDI

The UAE has attracted more than $75 billion in foreign direct investment (FDI) since 2000 to emerge as the second largest foreign capital destination in the Arab world after Saudi Arabia, according to official data.

Saudi Arabia, the largest Arab economy, got nearly $130.5 billion in FDI during 2000-2010 while Egypt maintained its position as the third largest FDI recipient in the region, showed the figures by the Kuwaiti-based Inter-Arab Investment Guarantee Corporation (IAIGC), a key Arab League establishment.

The report showed cumulative FDI flow into the UAE totalled $75.7 billion during 2000-2011, nearly 17 per cent of the total Arab FDI inflow of $446 billion.

Saudi Arabia accounted for around 38 per cent of the overall Arab FDI despite a sharp decline in its FDI in 2010, when it stood at around $21.5 billion compared with nearly $36.5 billion in 2009, the report showed.

FDI flow stood at around $54 billion into Egypt, nearly $35 billion into Qatar, $31 billion into Lebanon and about $24 billion into Sudan.

Citing figures by the United Nations Conference on Trade and Development (UNCTAD), the IAIGC report showed total FDI flow into the Arab region plunged by nearly $22 billion to $64 billion in 2010 from $86 billion in 2009.

A breakdown showed there was a decline in most regional states except Lebanon, Morocco, and conflict battered Libya and Iraq.

FID into the UAE edged down slightly to around $3.9 billion from $four billion while capital flow into Qatar slumped to $6.5 billion from $8.7 billion. The biggest fall was in Saudi Arabia, accounting for nearly $15 billion because of the shelving of some major hydrocarbon projects in the world’s oil superpower.

Kuwait also suffered a sharp drop in FDI inflow from around $1.11 billion in 2009 to nearly $80 million in 2009, said the report, which gave no reason for the fall.

As for FDI outflow, the UAE emerged as the largest capital exporter in the Arab region, pumping nearly $52 billion into global markets during 2000-2009.

The report, which gave no figures for 2010, showed Kuwait came second, with capital outflow standing at $38 billion during that period. It was followed by Saudi Arabia, with around 36.8 billion, Qatar with nearly $15.9 billion, Libya with about $10.1 billion and Lebanon with an outflow of $six billion.

The cumulative capital flow out of the Arab region totalled around $177 billion during 2000-2009, according to the report.

In a recent report, UNCTAD ranked the UAE as the 30^th largest capital exporter in the world as it was outstripped only by major developed nations.

UNCTAD figures covered only FDI as they did not include capital channeled by the Abu Dhabi Investment Authority (ADIA), one of the world’s largest sovereign wealth funds (SWFs), with assets of between $300-900 billion.

The report showed FDI flow out of the UAE climbed to a record high of around $15.8 billion in 2008 from $14.5 billion in 2007 before plunging to nearly $2.7 billion in 2009 because of the global fiscal crisis and lower oil prices.

The report showed the United States was the top capital exporter in the world, channeling around $4.3 trillion during 1990-2009, more than a fifth of the world’s total FDI outflow of nearly $18.9 trillion. It was followed by France with around $1.71 trillion, Britain with $1.65 trillion, and Germany, with $1.37 trillion. China also emerged as a giant capital exporter with nearly $1.36 trillion.

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