UAE draws $100 billion foreign direct investment

Shaikh Saud bin Saqr Al Qasimi, Sultan bin Saeed Al Mansouri and Suhail bin Mohammed Faraj Al Mazroui attend the UAE Economic Planning Forum in Ras Al Khaimah on Wednesday.

The total volume of foreign investments in the UAE, at present a regional base for over 500 international companies, exceeded $100 billion in the past 10 years, Minister of Economy Sultan bin Saeed Al Mansouri said on Wednesday.
In his address at the inaugural session of the UAE Economic Planning Forum in Ras Al Khaimah, Al Mansouri said the UAE is aiming to lower the oil sector's present contribution from 69 per cent of gross domestic product (GDP) to around 20 per cent in the next few years through a diversification drive. His Highness Shaikh Saud bin Saqr Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah, inaugurated the second edition of the Forum.
Al Mansouri said that within just 44 years, the UAE economy has taken tremendous leaps compared to other global economies thanks to the federal government's dynamic approach that focuses on economic diversification with the view to achieving long-term sustainable development. In 2014, the UAE's GDP amounted to Dh1.47 trillion compared to only Dh6.5 billion in 1971.
"The UAE economy has maintained positive growth levels despite a decline in oil prices and a slow global economic performance. This has come about as a result of our resilient economic policies that aim to increase diversification and decrease reliance on oil," the minister said.
Al Mansouri said financial reserves in the UAE's foreign accounts have largely limited and cushioned the economy from market fluctuations. "Consequently, our national economy achieved a 4.6 per cent GDP growth in 2014, and we expect to register a three per cent to 3.5 per cent GDP growth in 2015 despite prevailing challenges."
Al Mansouri said that the UAE has emerged as a very important hub in the Middle East, connecting the East with the West by both sea and air. "The country came first regionally and 22nd globally in the Global Investment Index 2015," he said.
"With 34 multi-specialty free zones in the country, full foreign ownership has now been made possible with zero tax rates and a 100 per cent profit transfer. All of these factors have significantly helped develop our infrastructure, attract greater foreign investment flows, transfer knowledge and technology to the UAE, and build a sustainable knowledge economy," Al Mansouri said.
According to the Ministry of Economy statistics, foreign direct investment (FDI) contributed five per cent to the UAE's GDP in 2014 and grew 25 per cent to more than Dh47 billion.
Suhail bin Mohammed Faraj Al Mazroui, Minister of Energy, said the 'Year of Innovation' has significantly helped strengthen innovation in the country's energy sector and its affiliates.
"Today, as never before, we see the urgent need to reduce consumption as the average annual increase in the consumption of power and water in the UAE has touched six per cent. Water and electricity services are subsidised by the government and these amount to nearly Dh35 billion per annum."
The minister said the aim is to reduce consumption by 10 per cent, which will save Dh3.5 billion per annum in government spending.
- issacjohn@khaleejtimes.com