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Is Dubai headed for another economic boom? The answer from industry and financial experts is yes. Their insights are based on the latest Dubai FDI Monitor data, which ranks Dubai first in the Arab world and third globally for FDI attractiveness.
“Dubai is now one of the most attractive locations in the world for foreign direct investment. Global investors have confidence in our business ecosystem,” said HHS Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of Dubai Executive Council.
Experts agree with Dubai’s political leadership, which has been presiding over a series of reforms to boost economic growth. Interestingly, Dubai attracted US$4.3 billion in FDI capital inflows from 371 projects in the first nine months of 2021, a sharp increase from the previous year.
“Attracting $4.3 billion in foreign direct investment is a huge relief at a time when the world is still recovering from the pandemic-induced economic slowdown,” said Rakesh Menon, a former global senior vice president at JPMorgan Chase Bank in London. things.”
In fact, Menon spent considerable time in Dubai as a senior banking professional with Standard Chartered and Citibank before moving to London. According to him, Dubai is shaping itself as a wealthy European country.
“It’s not the old Dubai anymore. The new Dubai is full of artificial intelligence, blockchain, cryptocurrency, start-ups, fintech and other emerging technologies. I see the US and Europe moving their blockchain platforms to Dubai’s trend,” Menon noted, taking cues from the FDI source countries published by the Dubai FDI Monitor.
The United Kingdom (UK) accounted for 29% of flows into Dubai, followed by France (19%), the United States (14%), Saudi Arabia (6%) and India (4%). Together, these five countries accounted for 72 percent of total capital inflows into Dubai.
In terms of FDI projects, the UK ranks in the top 20%, followed by the US (19%), India (11%), France (6%) and Germany (5%). According to Menon, these figures show that Dubai is able to sustain Western interests, which hold the key to future events.
“Then you also need to consider Dubai’s strategic location, which helps it control 70% to 75% of global GDP. So I can say with confidence that Dubai is now catching up with the next wave of economic prosperity that has just started,” Menon added.
HE Helal Saeed Al Marri, Director General of the Ministry of Economy and Tourism, attributed the latest FDI trends to the emirate’s forward-looking policies, creation of new investment channels, and continuous improvement in the area of ease of doing business.
Krishnakumar Varma, founder of Finage Consulting Pvt Ltd, endorses and praises the infrastructure Dubai has created over the years. “Their infrastructure is simply unrivaled. Recent reforms, such as 100% ownership, have also given Dubai a further boost,” Varma explained.
Varma, a senior banking professional who has worked in Dubai for over 30 years with leading banks such as UAE NBD, First Abu Dhabi Bank, NBQ, Doha Bank and HSBC, believes that long-term investment in Dubai has led to world The creation of infrastructure for tier-one banks is finally paying off.
What Varma said was reflected in Dubai FDI Monitor data, which confirmed that as much as 58 percent of inbound FDI took place in strategic sectors, compared to 52 percent in greenfield projects. The total number of FDI projects increased by 16% to 378 from 326 in 2020.
Menon and Varma agree that Dubai will soon become a global hub for emerging technologies, as the emirate is eager to boost revenues from non-oil sources. Saudi Arabia is indeed stepping up the competition. “But it will not be easy for them to catch up with Dubai,” Menon added.
Meanwhile, Fahad Al Gergawi, CEO of Dubai FDI, attributed Dubai’s FDI performance to innovative strategies and a global approach. Buoyed by FDI inflows, Al Gergawi is optimistic that the emirate will continue to attract global businesses. “The new momentum has just begun,” he concluded.
Disclaimer: This article is part of a series featuring content on business in Dubai
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