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Dubai attracted around Dhs12bn of FDI in H1 2020

There were 190 FDI projects announced in the emirate in H1 2020, around 50 per cent of them being greenfield initiatives

by Varun Godinho

August 4, 2020

FDI inflows into Dubai during H1 2020 amounted to an estimated Dhs12bn, according to Dubai FDI Monitor data released by Dubai Investment Development Agency (Dubai FDI), an agency of Dubai Economy.

Dubai ranked as the top city in attracting FDI within the Middle East and North Africa (MENA) region. Globally, it ranked third in the number of greenfield FDI projects and fourth in FDI capital flows, according to Financial Times’ fDi Markets.

Dubai ranked first in the MENA region and 11th globally among the top 20 most popular destinations for venture capital investments, stated the fDi Markets’ Global Venture Capital FDI Ranking 2020 report.

Led by @HHShkMohd’s vision, Dubai continues to maintain its regional & global economic competitiveness, with clear strategies that enable our city to keep pace with changes and overcome challenges. pic.twitter.com/UrvyHicc7c

— Hamdan bin Mohammed (@HamdanMohammed) August 4, 2020

There were 190 FDI projects announced in the emirate in H1 2020 across sectors including technology, e-commerce and pharmaceuticals.

Around 50 per cent of the total announced projects are greenfield FDI projects, followed by new forms of investment (NFI) projects (36 per cent), re-investment projects (8 per cent), mergers and acquisitions (4 per cent), and new joint ventures (2 per cent).

The US topped the list of source countries in terms of FDI capital flows to Dubai in H1 2020 accounting for 25 per cent of the total, followed by France (18 per cent), Belgium (9 per cent), UK and China (8 per cent each).

These five countries together accounted for 68 per cent of total FDI capital flows to Dubai.

“The sustained FDI flows in H1 2020 reflect the continued attractiveness of Dubai’s investment environment, and its success in combating the Covid-19 pandemic and starting the recovery phase in record time,” tweeted Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Dubai Crown Prince and Chairman of The Executive Council of Dubai.

FDI flows into Dubai-based start-ups was recorded at over Dhs739m in the first six months of 2020.

The emirate also secured the seventh position globally among the top 10 cities in the rankings of the ‘FDI Aerospace Cities of the Future 2020/2021’ report, and ranked second globally in FDI performance in the sector.

Also, there was a 53 per cent increase in medium and high technology investments year-on-year in H1 2020.

As part of a digital engagement programme, Dubai FDI said in July that it had lined up 34 virtual seminars to spur foreign investment into fields including healthcare, logistics, e-commerce, digital economy and food and agribusiness sectors.

Read: UAE ranks 19th in FDI confidence index backed by strong investor sentiment

In June, it was revealed that the UAE was one of only three emerging markets to be featured in the 2020 Kearney Foreign Direct Investment (FDI) Confidence Index. The UAE ranked 19th worldwide in that index, up two places from 2017.

Read: Revealed: The new key laws introduced in the UAE to support businesses

Last year, the laws in Dubai were changed to encourage FDI investments into the emirate.

The new law now allows up to 100 per cent foreign ownership in more than 122 economic activities across 13 sectors including transport and storage, agriculture, space, manufacturing industry, renewable energy, hospitality and food services, among others.

Also, the law provided for the removal of restrictions on repatriation of profits and any proceeds from liquidation or sale of business.