The UAE has emerged as the largest market for foreign direct investment (FDI) in the Arab world and it has attracted more than $40 billion (Dh147bn) in 11 years, according to official figures.
Between 1996 and 2005, cumulative FDI in the UAE stood at about $26.39bn (Dh97bn), more than a fifth of the total FDI in the Arab region, said the Inter-Arab Investment Guarantee Corporation (IAIGC), one of the key financial organisations of the Arab League. It gave no figures for 2006, however according to the International Monetary Fund, the UAE attracted in excess of $14bn (Dh52.42bn).
This brings the total FDI pumped into the UAE between 1996 and 2006 to more than $40bn, the highest level in the Arab world. In its 2007 report, the World Economic Forum said the UAE topped Arab nations in its Global Competitiveness Index, which measures the extent of a country’s openness and attractiveness for private business.
“The UAE is the most competitive economy in the Arab world among the countries at the third and most advanced stage of development, according to The Arab World Competitiveness Report 2007,” the IAIGC said, adding the UAE ranked 29th in its global index.
Figures from IAIGC showed Saudi Arabia was the second largest destination for FDI in the Arab world, attracting about $30bn (Dh110bn) during 1996-2006. It was followed by Egypt, Morocco, Lebanon, Sudan, Algeria and Bahrain.
The UAE is also the third-largest destination for Arab investment after Saudi Arabia and Sudan. The report by the Kuwait-based organsiation showed Saudi Arabia topped the region in inter-Arab investment, attracting a cumulative $47.9bn (Dh176bn). It was followed by Sudan, which attracted about $5.59bn (Dh20.53bn), and the UAE with Arab capital inflow of nearly $3.57bn (Dh13.11bn). Other key destinations were Syria, with $3.2bn (Dh11.75bn), and Jordan, with $3.5bn (Dh12.85bn).
The report showed a growth in FDI in the Arab world over the past decade, peaking at more than $50bn (Dh183.64bn) in 2006.