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MEDIA / Blog / Foreign Direct Investment Hub – UAE
In recent years, the UAE has undertaken impressive steps to attract investment inflows from oversea territories. Now, after enforcing the new Foreign Direct Investment (FDI) law, the UAE is expected to receive 20% more foreign investment inflows this year, according to estimates by the Ministry of Economy.

The FDI committee has been formed and is currently reviewing the proposed list of sectors eligible for full direct investment. All these steps have further strengthened the country’s business-friendly climate.

Therefore, it is expected that more companies will be encouraged to invest in UAE. Al Mansouri, the Minister of Economy stated: “The UAE is pressing ahead with its vision to develop a conducive investment environment and enhance incentives and advantages offered to foreign investors, which contributed to enhancing the country’s regional and international investment status and attractiveness.”

The International Monetary Fund has estimated that the UAE's GDP will increase by 3.7% in 2019, compared to 2.9% last year. The UAE Central Bank also predicted the UAE’s non-oil GDP to expand from 2.6% to 3.4% this year.

In nowadays globalized world, attracting international investments is one of the most significant tasks of any country's government. Especially for the UAE, FDI is an influential factor to its diversification strategy. The strategy to diversify the country's revenue base and reduce dependence on oil proceeds has turned the UAE into the commercial and trading hub of the Middle East area.

To prepare itself for a post-oil future, the UAE is now transferring to a knowledge-and-innovation-driven economy, where Foreign Investment plays a key role in the country's socio-economic growth. The new-generation technologies are increasingly affecting the current global economies, as well as international investment and trading activities.

Dubai, for example, has received Dh 38.5 billions of FDI capital flows in 2018, increasing by 41% from Dh 27.3 billion in 2017. Many of them are small and medium-sized investments with a high technology component and large innovation capabilities. More than 58% of the investments go into the medium and high-tech areas.

Furthermore, higher FDI actually results to additional job opportunities for the UAE labour market, as well as attraction of more foreign talent to work and live there. More precisely, foreign investments have helped initiate 523 projects in Dubai 2018 and have assisted in creating approximately 25,000 new jobs in the emirate - a 77% increase from the previous year of 2017. 29% of the new jobs were created by medium and high-tech FDI projects.

The UAE has become a preferred FDI destination in the Arab region, and specifically, Dubai is now the top FDI destination in the Middle East and North Africa. Currently, most of the investments are coming from the USA, Europe, UK, Asia and China.

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