According to latest government statistics, Dubai which is Middle East’s financial, transportation and trade center, attracted $6.7 billion in foreign direct investment (FDI) in 2020 through 455 ventures.
Last year, inbound FDI contributed to the creation of 18,325 new jobs in the emirate. The 455 FDI projects implemented in Dubai in 2020 exceeded the annual average of 441 in the previous five years.
“Dubai’s success in combating the COVID-19 pandemic and starting the recovery phase in record time is a testament to our commitment to provide the best investment environment in the world and transform global challenges into new opportunities for growth. The Emirate’s success is driven by technology and innovation and powered by Emirati and global talent, making Dubai the best place in the world to work, live, and invest”.
In recent months, the UAE has implemented a series of regulatory reforms to attract further investment into its economy, create jobs, and attract high-skilled talent. These have included changes to its visa regime offering citizenship to qualifying investors and reforms to its commercial company ownership laws removing the requirement for onshore companies to have a local sponsor.
As per the reports, globally, FDI fell 42 percent in 2020 and is projected to fall even further in 2021 as the COVID-19 pandemic threatens to stymie economic recovery. The US was the leading source region, accounting for 21 percent of FDI capital and 22 percent of FDI projects in Dubai. Last year, France brought in 16 percent of FDI capital to the Emirate, followed by Japan with 11 percent, the UK with 7 percent, and Germany with 6 percent.
The accommodation and food services industry attracted the most FDI flows into the Emirate, accounting for 40 percent of the total projected FDI capital moves. The top five industries were electric power generation, information services, healthcare, and social assistance, and retail and wholesale trade.
Accommodation and food services, retail and wholesale trade, software publishers, finance and insurance, and company management were the top five sectors in terms of FDI projects, accounting for 54 percent of the total.
Dubai leads the way
According to the sources, Dubai led the Middle East and North Africa (MENA) region in attracting greenfield FDI funds. The emirate also attracted the largest share of FDI projects in the world, receiving 2.1 percent of the total last year.
According to the Dubai FDI Monitor, FDI capital from reinvestment ventures in Dubai reached $0.4 million in 2020, surpassing $0.2 million for the first time since 2016. Dubai ranked first in the MENA region in reinvestment FDI projects and capital. Dubai ranked first in the MENA region in reinvestment FDI projects and capital. In both divisions, it came in 4th and 11th place globally.
The sources suggested that Dubai-based startups attracted an estimated $0.6 billion in venture capital FDI capital through 31 investment deals in 2020. On FDI Intelligence’s “Global Venture Capital FDI 2020” survey, Dubai was ranked first in the MENA region and 11th globally.