The UAE ranked second globally in the number of greenfield FDI projects in 2023 with 1,280 ventures, rising 36% y-o-y and trailing only behind the US, according to an Emirates NBD report (pdf). FDI inflows grew by 33% y-o-y to reach USD 15.08 bn.

Dubai Dubai maintained its top spot among cities with over 1k projects, while Abu Dhabi ranked 6th globally with 172 projects. It also led in terms of FDI flows, with USD 6.81 bn, Abu Dhabi close behind at USD 4.48 bn, according to the report. Sharjah secured USD 2.75 bn, primarily fueled by India-based Infinite Mining & Energy's investment in a new refinery in Hamriya Freezone.

The breakdown by sector: The businesses service sector had the largest share of greenfield FDI projects, with 383 projects during the year, followed by software and IT (269), financial services (131), industrial equipment (81), and real estate (54). Coal, oil and gas attracted the most FDI flows at USD 2.6 bn, mostly due to the USD 2.5 bn Hamriya refinery, according to the report.

At 60 projects, Dubai was the leading city in new greenfield HQ projects, beating out Singapore (40 projects) and London (31). The UAE claimed the third spot globally, with 76 greenfield HQ projects, with the UK and US taking the top two spots.

This is thanks to regulatory reforms and ease of doing business: “The introduction of regulatory reforms, including the allowance of 100% foreign ownership in specific sectors, enhanced intellectual property protections, and streamlined licensing procedures, has significantly bolstered the UAE's appeal to international investors,” the report said. “These changes have not only facilitated ease of doing business but have also instilled confidence among foreign investors regarding the protection of their investment,” it added.

Momentum expected to continue: The “synergy between improved investment conditions and robust trade partnerships” will help sustain the momentum of FDI flows and achieve the goal of USD 150 bn in FDI Inflows by 2031, according to Emirates NBD.

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