Dh68bn FDI beats UAE forecasts

Foreign direct investment in the UAE has smashed expectations by increasing more than 10 per cent, led by the financial sector, Minister of Economy Sheikha Lubna bint Khalid Al Qasimi announced yesterday.

In a statement, the minister revealed results of a survey that showed FDI had increased in 2006 by 10.8 per cent to Dh68.63 billion, compared with Dh61.91bn the previous year.

She said the survey covered firms that were operational for a year or more and whose 10 per cent or more capital is owned by a non-resident, regardless of nationality. Earlier estimates put foreign direct investment at Dh40bn and Dh47bn in 2005 and 2006 respectively.

Last week Emirates Business reported the figure at at least Dh52bn.

According to Al Qasimi, the financial brokerage and insurance sector accounted for 34.4 per cent, followed by the construction sector (29 per cent), and wholesale, retail and internal trade sector (14 per cent). The survey said Dubai’s share amounted to 62 per cent, Abu Dhabi (24 per cent), Sharjah (10 per cent), and the rest of the emirates about four per cent.

She said Dubai led in attracting foreign investment, while the other emirates had started picking up pace over the past two years. The survey showed economic activities in Abu Dhabi were concentrated in financial brokerage and insurance sector (42 per cent) and construction (21 per cent).

In Dubai, the financial brokerage and insurance sector accounted for 35 per cent, construction (35 per cent) and wholesale, retail and internal trade (14 per cent).

In Sharjah, the financial brokerage and insurance sector represented 27 per cent of investment, followed by construction (26 per cent) and transport and communications sector (21 per cent).

The survey was conducted in co-operation with the Economic and Social Commission for Western Asia, UN Conference on Trade and Development as well as some local departments. (Wam)