Despite pandemic Dubai attracts FDI worth $3.3 billion in H1 2020

By Rahul Vaimal, Associate Editor
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Dubai Image
Representational Image

Even during the challenging times of the coronavirus pandemic, foreign direct investment (FDI) continued to flow into Dubai as the number of announced FDI projects reached 190 in the first half of 2020, attracting an estimated capital of $3.3 billion, reflecting the strong appeal of the emirate among foreign investors.

The Emirate has been successful in attracting foreign investment in strategic sectors such as e-commerce, pharmaceutical and technology industries, according to the Data from the “Dubai FDI Monitor” released by Dubai Investment Development Agency (Dubai FDI).

Dubai had received $12.7 billion in foreign investment during the first half of 2019, which records a rise of 135% compared to the previous year.

In addition, capital flows to companies operating in Dubai also increased drastically in the first half of 2020. The emirate grabbed the 7th spot among the world’s top 10 cities in the rankings of the ‘FDI Aerospace Cities of the Future 2020-21 survey.

It was also ranked 2nd in the sector’s FDI performance globally. Data showed that compared to last year, from ‘Dubai FDI Monitor’ also showed a 53% rise in medium- and high-tech investment in the first half of 2021.

Data revealed that 2% of the overall projects announced were joint ventures, followed by mergers and acquisitions (4%), reinvestment projects (8%), New Forms of Investment (NFI) projects (36%) and 50% of Greenfield FDI projects.

The US topped the list of source countries in terms of FDI capital flows to Dubai, representing 25% of the total in the first half of 2020. This is followed by France (18%), Belgium (9%), and the UK and China (8% each). These five countries together contributed 68% of the total FDI capital flows to Dubai.

According to Financial Times’ fDi Markets, the Emirate was ranked third in the number of greenfield FDI ventures, and fourth in FDI capital flows. The Global Venture Capital FDI Ranking 2020 report by fDi Markets also ranked Dubai among the top 20 most popular venture capital investment destinations in the Mena region, and 11th globally.

H1 2020 FDI trends reinforced Dubai ‘s success in generating new investment opportunities even with the challenges posed by the COVID-19 crisis, says Sami Al Qamzi, Dubai Economy’s director-general.

Stimulus packages to help business continuity and the release of executive regulations by UAE’s FDI legislation has played a great role in bringing about a positive investment climate in Dubai and UAE in spite of the challenges that COVID-19 posed, according to him.

Fahad Al Gergawi Image
Fahad Al Gergawi
CEO, Dubai FDI

Thanks to the leadership’s policies and initiatives to tackle the challenges COVID-19 presents, Dubai is currently one of the world’s leading global investment destinations in terms of crisis preparedness and resilience.

Chartered House CEO Anurag Chaturvedi said lower inflation rates, modern infrastructure, stable government and access to finance are the main factors that attract foreign direct investment.