UAE to see multifold increase in FDI flows in diverse sectors after Ministry of Investment establishment, say analysts

The UAE is expected to see a multifold increase in foreign direct investment inflows across diverse sectors following the establishment of the Ministry of Investment, say analysts.

The UAE on Monday announced that the Ministry of Investment has been established to devise policies to attract further investments into the country.

The country is already a magnet for FDIs, achieving the first ranking in the Kearney 2023 Foreign Direct Investment Index.

In addition, the UAE also set up a Financial Stability Council to monitor risks and deal with any financial crisis in the future.

“The UAE is a global financial hub trusted by thousands of financial institutions and millions of investors around the world. Our goal is to maintain this confidence,” His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, said on Monday after announcing the establishment of the ministry, which will be headed by Mohamed Hassan Al Suwaidi.

Achraf Drid, managing director, XTB Mena, the ministry could help boost the UAE’s efforts to grow its economy and investments in the country as well as improve the business environment and competitiveness of the local economy.

He said the Ministry could help accelerate the rate of development and progress recorded until now.

“The creation of a dedicated entity is a clear sign from the government that investments are more than welcome and that it is ready to make the necessary changes to nurture success,” he said.

Drid added that the creation of the ministry could help the UAE face increasing global competition and continue to assert itself as one of the top destinations for foreign investments in the wider region and develop further its status as a global platform for business, finance, logistics, and technology among other fields.

“The UAE has been able to attract increasing foreign investments over the years thanks to sound policies and the ongoing strength of the local economy. The new ministry could help go a step further,” Drid said.

James Swallow, Commercial Director, PRO Partner Group

James Swallow, Commercial Director, PRO Partner Group, said the establishment of the Ministry of Investment with the aims of stimulating investment, legislation and procedures to make the UAE a more attractive environment for FDI will further improve confidence and trust.

“The UAE has a high level of trust for investments and is ranked at the top of Mena countries for FDI. The reason for this is the UAE’s development of its financial services and tourism sectors, and implementing necessary business reforms for attracting foreign investment,” said Swallow.

“The Financial Stability Council has been created to monitor risk and financial crisis, furthering the objective for the UAE to become a key international financial centre,” he said, adding that they recorded approximately 20 per cent of foreign businesses incorporating within the UAE, which can be attributed as a direct result of the trust associated with the increase in FDI.

• Business