Local Business

Surge in FDI boosts UAE oil and non-oil sectors

Isaac John (associate Business Editor)
Filed on April 2, 2015
Surge in FDI boosts UAE oil and non-oil sectors

Investment in agriculture, industry and SMEs discussed at AIM

Delegates attending the Annual Investment Meeting in Dubai on Wednesday. Photo by Mukesh Kamal/ Khaleej Times

Delegates attending the Annual Investment Meeting in Dubai on Wednesday.
Photo by Mukesh Kamal/ Khaleej Times

Dubai — A 25 per cent surge in foreign direct investment, or FDI, to the UAE in 2014 has helped boost oil and non-oil businesses across all sectors in the country, especially firms working in the petrochemical, aviation and tourism industries, a senior official at the Ministry of Economy said.

Abdullah bin Ahmed Al Saleh, Undersecretary of the Ministry of Economy — Foreign Trade sector, said FDI contributed five per cent to the UAE’s gross domestic product (GDP) in 2014 and grew 25 per cent to more than Dh47 billion. He pointed out that changes in the world FDI landscape is continuing at a rapid pace and is characterised by fierce competition and its determinants are evolving towards more efficiency seeking location advantages.

“A lot of countries have realised the benefits FDI can bring to accelerate growth and development to their economies as it allows the transfer of technology and higher-end industries. Transnational corporations, the main drivers of FDI, are a powerful and effective means to disseminate technology from developed to growing markets, and represent a major source of new and innovative technologies that are usually not available through the market,” Al Saleh told Khaleej Times.

Surge in FDI boosts UAE oil and non-oil sectorsThe UAE Ministry of Economy set up a new integrated Investors’ Zone within AIM for more direct investment deals in an interactive setting. The Investors’ Zone was dedicated to investors interested in meeting prospective clients and AIM participants, for facilitating on-the-spot transactions.

Al Saleh said the Ministry introduced this concept for the first time at AIM, as part of a firm strategy to encourage innovation and creativity in investment cycle, and to boost relations between foreign investors and investment destinations.

“The launch of the Investors’ Zone comes in response to the need for more effective interaction between concerned parties, as well as to enable a better understanding of procedures and rules for entering new markets. The ultimate goal is, of course, to boost FDI. The concept reflects the maturity of AIM, supported by a strong and diverse investment base in the UAE. Investors’ Zone has been designed to encourage more investors to expand their portfolio in existing locations and explore new ones.”

The Investors’ Zone at AIM featured key companies, including Islamic Corporation for Private Sector Development, National Holding, Citadel Capital, Masdar City, Enel Group from Italy, Thani Investments, Mubadala, Borouge, etisalat, Al Dahra Agricultural Company and Abu Dhabi Fund for Development.

The AIM, which ended on Wednesday, had its focus mostly on agriculture and industry to benefit countries with huge land areas and limited investment capabilities.

Industrial investment was also a key topic of discussion at AIM 2015, considering its importance in supporting the national GDP and its role in technology transfer and innovation. The role of FDI in supporting SME business was another key topic at AIM. On its last day, AIM featured a special session for SMEs and start-ups titled ‘The new wave of innovative start-ups in growing markets’.

FDI in education was also a topic of discussion at the AIM. The session discussed ways and means to enhance the technological contribution of foreign firms and how important education and skills development are in this process

The three-day AIM drew business leaders, senior public officials and heads of international institutions and academia representing some major stakeholders of the international investment community. It had helped shed light on the policies needed in both host and home countries of FDI, at national and international levels to encourage technology transfer and dissemination through FDI.

— issacjohn@khaleejtimes.com

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