Sunday 7 April 2019
Dubai attracted foreign direct investment (FDI) worth USD 10.5 billion in 2018, an increase of 41 percent over the previous year, despite global FDI flows declining by 19 percent in 2018 as reported by the United Nations Conference on Trade and Development (UNCTAD). This elevated Dubai from 10th to sixth place in terms of global capital flows into greenfield projects.
As many as 523 FDI projects were reported in 2018, an increase of 43 percent over 2017, taking Dubai’s global ranking in the number of new investment projects from fourth to third. The data were revealed by the annual ‘Dubai FDI Results & Rankings Report 2018’ of the Dubai Investment Development Agency (Dubai FDI), an agency of the Department of Economic Development (DED) in Dubai.
His Highness Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council of Dubai, attributed the achievements to global investors’ continued confidence in Dubai’s ability to sustain economic growth.
Dubai’s FDI performance in 2018 earned the emirate the number one spot on the ‘Top fDi Performers 2018’ report by fDi Intelligence, a Financial Times publication. The report features the city among the best performers in categories such as Global Cities of the Future, Digital Economies of the Future, Aerospace Locations of the Future, and top global free zones of the year.
Financial Times’ fDi Intelligence is based on data compiled by fDi Markets, the world’s leading online platform that monitors capital flows and new FDI projects around the world, and fDi Benchmark, which identifies the best FDI destinations based on comparison of the latest FDI data. The report highlighted that Dubai has dominated global FDI rankings throughout 2018, followed by London, Paris, Dublin, and Singapore, as the leading city globally for FDI in 2018.
Dubai has created a world-class investment ecosystem in which FDI plays a central role in the transfer of knowledge and technology as well as in attracting global talent, which are the pillars supporting the city in achieving the goals set in the Dubai Plan 2021 and the 50-Year Charter aimed at strengthening Dubai’s position as a pivotal hub in the global economy, Sheikh Hamdan said.
The ‘Dubai FDI Results & Rankings Report 2018’ has added a new index that monitors the contribution of FDI to job creation. According to this index, about 25,000 jobs were created in 2018, an increase of 77 percent compared to 14,065 jobs created in 2017, effectively placing Dubai in ninth position globally in job creation through FDI.
Recent policies that support the role of investors, innovators, skilled professionals, and students in building an innovation and knowledge-based economy for Dubai and the UAE add to Dubai’s attractiveness for the world’s most promising talent.
Medium- and high-tech FDI projects proved to be major drivers of job creation, accounting for 28 percent of the jobs added in 2018. Such projects comprise 43 percent of the total FDI projects in 2018 and accounted for 15.6 percent of capital inflows. The ‘Dubai FDI Monitor’ classifies medium- and high-tech FDI projects based on the definition of the Organization for Economic Cooperation and Development (OECD).
The resilience, diversity, and competitiveness of Dubai’s economy is attributed to new strategic advantages for investors and the business community, including developing the city’s infrastructure and regulatory environment as well as launching a range of incentives to accelerate economic growth. These efforts have contributed to enhancing business competitiveness and investor confidence as key drivers of sustainable economic development in the emirate.
Dubai has been ranked first globally among the top 20 cities for renewable energy investments between 2013-2018, and second globally in the ‘Global Cities of the Future 2018–2019’ report in terms of economic potential. Dubai also ranked first among the top FDI cities in the ‘City FDI Performance Index,’ issued for the first time in 2018.
Dubai’s investment ecosystem offers unique investment opportunities and supports the growth and expansion plans of global conglomerates and start-ups. Dubai also promotes the growth of FDI projects classified as New Forms of Investment (NFI). NFI accounted for 28.9 percent of total investments in 2018, compared to 20.7 percent in 2017.
The United States retained its leading position as a source market of FDI capital flows to Dubai with a 37 percent share. India came second with 12 percent, followed by Spain (9 percent), China (7 percent), and the UK (5 percent). The top five countries accounted for 70 percent of total FDI capital inflows and 51 percent of FDI projects into Dubai in 2018.