In 2022, the UAE’s GDP will grow by a staggering 7.9%. – KT file
The UAE is the leading emerging market in the Middle East and Africa (Mena) region, according to Kearney’s 2023 Foreign Direct Investment Confidence Index (FDICI) Emerging Market Rankings.
Thanks to strong growth last year, an attractive business environment and focus on innovation and technological capabilities, the UAE ranked first in the region and third globally, behind China and India.
In 2022, the UAE’s GDP will grow by a staggering 7.9%, while many other countries will see weak growth after a post-Covid boom in 2021. The country is expected to continue growing steadily in 2023 and 2024, with growth rates of 3.2% % and 4.8%.
“The UAE remains an extremely attractive destination for investors, especially in light of the launch of the Dubai Economic Agenda (D33) – an $8.7 trillion economic plan to boost trade, investment and boost its global Hub status. It is clear that the government remains relentlessly committed to diversifying the UAE’s economy and strengthening the UAE’s business environment. The disciplined way in which they have driven the economy and the country to prepare for the future has been amazing. With the energy transition Funding this ongoing transformation, unfolding at a global scale in various ways and at various speeds, will continue to benefit from hydrocarbon demand,” commented Rudolph Lohmeyer, Partner, Kearney Institute for National Transformation in the Middle East.
The UAE ranks 18th globally, joining Qatar (21st) and Saudi Arabia (24th), boosting the Middle East’s position in the index.
Saudi Arabia’s strong performance is underpinned by high GDP growth (8.7% in 2022), comprehensive pro-business reforms, strong fiscal outlook and accelerated economic diversification.
Qatar has moved up three places in the global rankings from 2022, possibly due to the fact that Qatar hosted the prestigious FIFA World Cup last year, which boosted investor interest, coupled with the country’s aim to develop its economy and achieve economic growth. Diverse National Vision 2030. Strong growth in Qatar’s GDP, from 1.5% in 2021 to 4.1% in 2022, can also be attributed to increased investor confidence.
The GCC countries also topped the emerging market rankings, with Qatar at number four and Saudi Arabia at number six globally. Investor sentiment is on the rise in other Middle Eastern countries, with Egypt, Turkey and Morocco ranking 14th, 15th and 16th respectively in the emerging market rankings.
The report from the global strategy and management consulting firm reflected cautious optimism among investors about the global economy. More than three-quarters (82%) said they planned to increase FDI over the next three years, and 86% believed FDI would be more important to their business profitability and competitiveness over the next three years. However, concerns about downside risks dampened the positive sentiment.
“While investors are generally optimistic about the outlook for foreign direct investment, our results this year also reflect a degree of caution,” said report co-author Eric Kearney, partner and managing director of Kearney’s Global Business Policy Council. Erik R. Peterson said. “Investors cited rising commodity prices, heightened geopolitical tensions and heightened political instability in emerging markets as key risk factors for the next three years.”
The United States topped the list for the 11th year in a row. Canada returned to second place after falling to third place in 2022, and Japan jumped to third place from fourth last year. Germany dropped two places to fourth, likely due to economic and energy challenges due to the geopolitical crisis in Eastern Europe. Great Britain maintained its fifth position, followed by France. China jumped from 10th to 7th, likely due to Beijing’s decision to abandon its zero-coronavirus policy in the fourth quarter of 2022. Overall, this year’s survey again showed investors’ preference for developed markets, which accounted for 19 of the 25 developed markets. countries on the index.
The 2023 Index also found that business leaders believe that globalization is and will continue to be a central force in foreign direct investment. The vast majority of respondents (66%) expect globalization to increase over the next three years, while only 23% expect it to decrease. Those looking forward to global expansion cite interconnected digital infrastructure combined with growing trade opportunities and limited trade barriers as the main drivers. But investors also acknowledge that globalization is changing.
“While our findings suggest that investors believe in the benefits of globalization and expect it to intensify, they also expect more regionalization over the next three years and that governments will seek strategies to increase self-sufficiency,” said report co-author Dr. said Ritoland, manager of the Global Business Policy Council. “These results point to an awareness that while globalization will continue, its nature may be changing – and business leaders need to prepare accordingly.”
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