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Dubai thrives as the top global hub for greenfield FDI projects

In 2023, Dubai welcomed 1,070 global greenfield FDI projects

Published: Sun 19 May 2024, 6:31 PM

Updated: Sun 19 May 2024, 6:32 PM

By
Issac John

A view of the Dubai skyline. — AFP file

Dubai was ranked the No.1 global destination for greenfield foreign direct investment (FDI) projects in 2023 for the third successive year as it reinforces itself as a “must destination” for emerging businesses, investment, and talent, in addition to its rank as a key expansion hub for global corporations.

According to the Financial Times “fDi Markets” data, the most vibrant business hub of the Middle East was also the world’s No.1 within key clusters including consumer goods, energy, e-commerce, and tourism for greenfield FDI projects attraction, Greenfield FDI capital attraction, and jobs created through FDI attraction.

The FDI performance of Dubai aligns with the ambitious goals of the Dubai Economic Agenda D33 to double the size of the emirate’s economy by 2033 while underscoring the city’s robust economic growth and attractiveness to international investors.

In 2023, Dubai welcomed 1,070 global Greenfield FDI projects – 142 per cent more than second-placed Singapore (442) and 148 per cent more than third-placed London (431). In the past five years, Dubai’s global share in attracting such projects has more than tripled, increasing from 1.7 per cent in 2019 to 6 per cent in 2023.

Dubai’s increasing appeal as a business headquarters destination was highlighted by its No.1 ranking for HQ FDI projects for the second year. It attracted 60 projects in 2023. Singapore and London were second and third, with 40 and 31 HQ FDI projects respectively. Overall, Dubai also ranked fourth globally in the number of jobs created through Inward FDI, up from fifth in 2022, and for Greenfield FDI capital attraction it ranked fifth globally, up two spots from seventh position.

“Dubai’s ability to secure the No. 1 ranking in global greenfield FDI projects in 2023 for the third consecutive year demonstrates the city’s ability to continually generate new opportunities for global businesses,” said Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council of Dubai “Dubai’s stability, cutting-edge infrastructure, and dynamic business environment have made it a focal point for investment, enterprise, and talent,” said Sheikh Hamdan.

Helal Saeed Almarri, director-general of the Dubai Department of Economy and Tourism (DET), said Dubai’s sustained leadership in global FDI highlights its successful collaborations with stakeholders and international partners. The ranking affirms Dubai’s status as a premier global hub for high-quality foreign direct investment. “The enduring confidence of investors, multinational corporations, startups, and global talent in Dubai’s robust investment and business climate is a testament to our strategic initiatives,” he added

Hadi Badri, CEO of Dubai Economic Development Corporation (DEDC), said in addition to strong upswings across greenfield projects, there has been a surge of talent coming to Dubai.

According to “Dubai FDI Monitor” data, the emirate recorded 1,650 announced FDI projects in 2023, a strong growth of 39 percent compared to the 1,188 FDI projects in 2022.

Dubai remained the top city destination globally across several key technologies, with artificial intelligence (AI), FinTech, cloud computing, and cybersecurity featuring prominently. The city also placed first for the estimated number of jobs created by e-commerce investments.

According to UN Trade & Development, Global foreign direct investment (FDI) flows in 2023, at an estimated $1.37 trillion, showed an increase of 3 percent over 2022. Yet, excluding few large European deals, global FDI flows were 18 per cent lower. In line with global FDI flows, Dubai attracted an estimated Dh39.26 billion ($10.69 billion) in total FDI capital during 2023.

Canada featured in the top five source countries by FDI capital due to one large M&A deal – Canada-based Brookfield Business Partners acquiring Network International for $2.76 billion.

The top five source countries by total estimated FDI capital into Dubai in 2023 were Canada (26.5 percent), United States (17.5 percent), Saudi Arabia (8.9 percent), United Kingdom (8.2 per cent), and India (5.5 per cent), while the top five source countries based on total announced FDI projects were the United States (15.5 per cent), United Kingdom (15.3 per cent), India (14.9 per cent), France (6.3 per cent), and Italy (3.6 per cent).