According to statistics, the UAE is the world's 15th largest recipient of foreign direct investment in 2020, one place higher than the United Kingdom and seven places higher than in 2019. As Dubai’s Vice President and Ruler Sheikh Mohammed bin Rashid revealed last month, although global foreign direct investment flows fell by 35% last year, investment in the UAE increased by 11% to nearly US$20 billion. (73.45 billion dirhams).

"Natural resource transactions have spurred investment in the country, mainly the Abu Dhabi National Oil Company's sale of 49% of its natural gas pipeline for US$10 billion," the UNCTAD World Investment Report stated. In contrast, the UK's foreign direct investment inflows in 2020 decreased by 57% to US$19.7 billion.

In recent years, Adnoc's strategy of releasing capital related to non-core assets has been the main driving force for foreign investment into the UAE. In 2019, it attracted $5 billion into its oil pipeline, and in 2020 it sold 49% of its natural gas pipeline network for $10 billion, and it received funding from many sovereign and institutional infrastructure investors, including the United States-based company. Global infrastructure partners, Brookfield Asset Management of Canada and GIC of Singapore's sovereign fund, etc.

The UAE has also attracted investment in other sectors. According to the report, about 53% of foreign direct investment inflows into Dubai in the first half of 2020 went to medium and high-tech industries. Pakistan's CCL Pharmaceuticals also acquired a majority stake in StratHealth Pharma in Dubai for an undisclosed amount. The UAE has made some changes to its business and company laws in the past few years to stimulate investment. Earlier this month, new regulations allowing foreign investors to own 100% of domestic companies in most economic sectors came into effect. In terms of the economies of other countries, the country is also the 13th largest investor, recording US$19 billion in foreign direct investment outflows.

On a global scale, foreign direct investment in 2020 will fall by 33% from 2019 to US$1 trillion, as activity in all former investment sectors has declined. Foreign direct investment in advanced economies fell by 58%, and foreign direct investment in developing economies fell by 8%, mainly because Asian flows remained flexible. Driven by IT industry acquisitions, the inflow of funds to China increased by 6%, and the inflow of funds to India increased by 25%.

Keywords: capital flow, UAE

Livermore stated that “the UAE has improved its competitive position through reforms. These reforms should support a symbiotic relationship that supports non-oil economic growth and increases the UAE’s attractiveness to foreign investors”.Editor/Baohongying、design/Xiachangwang