UAE is top Arab capital exporter: official

The UAE has pumped nearly $54 billion into foreign markets over the past two decades to emerge as the largest Arab capital exporter and the world’s 30th investor, a senior official was quoted on Sunday as saying.

Foreign direct investment (FDI) outflow from the country climbed to an all time high of around Dh58 billion in 2008 before collapsing to only Dh9.9 billion in 2009 because of the global economic distress, said Abdullah Al Saleh, Director General of the Ministry of Foreign Trade.

“By the end of 2009, the UAE’s cumulative FDI abroad totaled around Dh198.3 billion compared with only about Dh7.3 billion at the end of 2000,” Al Saleh told the semi official Arabic language daily Alittihad.

“The UAE is considered one of the largest capital exporters in the world and the top investment in the Middle East according to statistics by the UN Conference on Trade and Development (UNCTAD).”

He said the surge in FDI outflow over the past 10 years had prompted the UAE to create what he called an overseas investment council for UAE investors abroad to discuss any obstacles facing them in foreign markets.

His figures showed the UAE’s FDI outflow had largely gained momentum since 2000, jumping to around Dh40 billion in 2006 and Dh53.6 billion in 2007 before peaking at about Dh58 billion in 2008. It plunged to nearly Dh9.9 billion in 2009 because of the crisis but Al-Saleh said it did not include non-direct capital.

“These figures show that the UAE is the top capital exporter in west Asia as it accounted for nearly 33.6 per cent of the region’s total outflow,” he said.

According to UNCTAD’s 2010 report, the UAE has recorded the largest FDI outflow in the Middle East and to become the 30th largest capital exporter in the world, outstripped only by developed nations.

UNCTAD’s data covered FDI flow 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.

Saudi Arabia, the largest Arab economy and the world’s top oil exporter, came second in the Arab world, pumping around $40.3 billion in FDI.

Qatar, the largest global LNG supplier, overtook Kuwait for the first time in FDI outflow, which stood at around $16.03 billion. Kuwait pumped nearly $16.01 billion, followed by Libya with around $11.9 billion.

The report showed the United States was the top capital exporter in the world, channeling around $4.3 trillion, 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.

As for FDI inflow, the UAE was second only to Saudi Arabia, attracting nearly $73.4 billion during 1990-2009, according to UNCTAD.

UNCTAD figures showed the bulk of the UAE’s FDI flow targeted other Arab countries, with nearly $62 billion invested in the region.

This turned the UAE into the dominant inter-Arab investor, accounting for more than a third of the total inter-Arab capital during that period.

Despite the surge in its FDI outflow, the UAE has remained a net capital importer. During 2004-2008, the UAE attracted around Dh189 billion, allowing it to record a net FDI surplus position of about Dh23.9 billion.

The UAE also emerged as the top investor in merger and acquisitions (M&A), with a total purchase value of $43.1 billion during 2006-2008, according to the Kuwaiti-based Inter-Arab Investment Guarantee Corporation.It was followed by Saudi Arabia, with around $19.5 billion and Egypt with nearly $11.6 billion. M&A purchase operations were estimated at around $11.2 billion in Qatar, $8.03 billion in Bahrain AND $6.6 billion in Kuwait.

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