Dubai maintains global leadership in attracting FDI: Hamdan Bin Mohammed

Gulf Today, Staff Reporter

Dubai has maintained its leadership among the world's preferred foreign direct investment (FDI) destinations in the first half of 2020 despite the economic and business repercussions of the COVID-19 crisis and the significant global decline in greenfield FDI flows.

Dubai remained at the forefront of cities in the Middle East and North Africa (MENA) region in attracting FDI. Globally, Dubai ranked third in the number of greenfield FDI projects and fourth in FDI capital flows, according to Financial Times’ FDI Markets, which records data on capital flows and greenfield FDI projects around the world.

Recovery and growth

Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Dubai Crown Prince and Chairman of The Executive Council of Dubai said FDI has continued to flow into Dubai in H1 2020, with the number of announced FDI projects reaching 190, worth an estimated capital of AED12 billion. The announced FDI projects included key sectors such as technology, e-commerce, and pharmaceutical industries, according to ‘Dubai FDI Monitor’ data released by Dubai Investment Development Agency (Dubai FDI), an agency of Dubai Economy.

Sheikh Hamdan said: “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. Thanks to the leadership of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, Dubai has further enhanced its ability to attract investments into emerging opportunities across strategic and new sectors, and enhanced its pivotal role as a global economic hub.”

Global achievements

Hamdan expressed his happiness at Dubai’s new global accomplishments in H1 2020. The emirate continued to be one of the top global investment destinations while also bolstering its status as one of the world’s safest and most stable investment destinations. The Financial Times’s fDi Markets data points to the diversity and attractiveness of investment opportunities in strategic and emerging economic sectors in Dubai in H1 2020. Dubai ranked first in the MENA region and 11th globally among the top 20 most popular destinations for venture capital investments according to fDi Markets’ Global Venture Capital FDI Ranking 2020 report.

Moreover, data from ‘Dubai FDI Monitor’ indicate sustained FDI flows into Dubai-based start-ups, which exceeded AED739 million in the first six months of 2020.  Dubai was also placed seventh globally among the top 10 global 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.  Data from ‘Dubai FDI Monitor’ also showed a 53% increase in medium and high technology investments in H1 2020, compared to the same period last year, as per the Organisation for Economic Cooperation and Development’s (OECD) methodology.

Sheikh Hamdan affirmed that Dubai's digital readiness and ability to offer diverse attractive investment opportunities for the entrepreneurial and technology sectors have enabled the emirate’s economy to successfully navigate the unprecedented challenges posed by the COVID-19 crisis. He also praised the efforts of all government agencies and free zones in Dubai to facilitate the establishment and growth of investment projects and support business continuity in these exceptional circumstances to enhance global investor confidence.

Source: Dubai Media

New opportunities for growth

His Excellency Sami Al Qamzi, Director General of Dubai Economy, said that FDI trends in H1 2020 confirm Dubai’s success in creating new investment opportunities despite the challenges posed by the COVID-19 crisis. New opportunities made available for sustainable growth and expansion in Dubai under the leadership of HH Sheikh Mohammed bin Rashid Al Maktoum and the directives of His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum have strengthened the ability of the local and global investor community in the emirate to overcome the repercussions of the pandemic.

Al Qamzi stressed that despite the challenges posed by COVID-19, the first half of 2020 witnessed positive developments in the investment environment in the UAE and Dubai, driven by stimulus packages to support business continuity and publication of executive regulations of the UAE FDI law. Al Qamzi praised the role played by the private sector as a strategic partner in facing the challenges posed by the pandemic, which ensured uninterrupted supply chains and added to the competitiveness and resilience of Dubai's economy.

Al Qamzi added: “By identifying current challenges and developing incentive plans and initiatives to ensure business continuity in the near-term, Dubai Economy is seeking to enhance the readiness of the investment environment to boost growth in the post-COVID-19 stage. Dubai Economy is also working to transform economic challenges and generate new opportunities for business expansion and growth in the emirate.”

Leader in crisis preparedness and stability

Fahad Al Gergawi, CEO of Dubai FDI, affirmed that Dubai is currently one of the world's leading global investment destinations in terms of crisis preparedness and resilience, thanks to the policies and measures adopted by the leadership to navigate the challenges posed by COVID-19. He stressed that FDI projects in H1 2020 were characterised by the flow of capital, technology, and talent into innovation-related projects, in addition to productive and operational capabilities. The trend confirms the attractiveness and stability of Dubai’s investment environment as well as the emirate’s leadership in digital transformation and the adoption of Fourth Industrial Revolution technologies. Dubai seeks to provide global businesses and startups new opportunities for growth, partnership and innovation.

Al Gergawi emphasised that H1 2020 data from the ‘Dubai FDI Monitor’ shows the efficiency and speed of the Dubai government and free zones in facilitating the process of establishing and licensing investment projects and companies.

Al Gergawi added: “With the easing of restrictions on movement and travel, we are working closely with investors to facilitate the realisation of announced FDI projects that faced challenges as a result of the COVID-19 crisis."

H1 2020 data from the ‘Dubai FDI Monitor’ shows that 50% of total announced projects are greenfield FDI projects, followed by new forms of investment (NFI) projects (36%), re-investment projects (8%), mergers and acquisitions (4%), and new joint ventures (2%). The USA topped the list of source countries in terms of FDI capital flows to Dubai in H1 2020 accounting for 25% of the total, followed by France (18%), Belgium (9%), and UK and China (8% each). These five countries together accounted for 68% of total FDI capital flows to Dubai.

Digital Investor Services

Al Gergawi said that as part of its aftercare programme, Dubai FDI has developed a number of new digital services in response to the COVID-19 crisis and maintained direct communication with investors and partners, providing them with information and data as well as support services to overcome the challenges brought by the crisis. Dubai FDI also launched a series of virtual investment promotion missions in cooperation with international partners and various Dubai government entities and free zones to continue showcasing the emirate’s advantages as a global investment destination and provide support to help investors tap opportunities.

Al Gergawi further said the focus of Dubai FDI virtual investment promotion missions on healthcare, logistics, e-commerce, digital economy and food and agribusiness sectors have succeeded in attracting broad participation from investors and partners around the world. Dubai FDI is working to organise more than 30 virtual missions in key global markets in the upcoming period.

Al Gergawi added: “Dubai FDI has developed the ‘Dubai FDI Monitor’ (www.dubaifdimonitor.ae) in record time to provide quality services to the local and global investor community, including reliable information about government policies and procedures related to COVID-19. It also seeks to introduce the investor community to economic incentives designed to support business continuity and analytical data to support decision-making.”