The UAE ranks first in the Middle East and third globally for foreign direct investment (FDI) confidence, according to Kearney’s 2023 FDICI Emerging Markets ranking.
The United Arab Emirates (UAE) has been ranked as the leading emerging market for foreign direct investment (FDI) confidence in the Middle East and North Africa (MENA) region, according to the 2023 Foreign Direct Investment Confidence Index (FDICI) Emerging Markets ranking by global consulting firm Kearney. The UAE secured the top regional position and third place globally, following China and India, due to its robust growth in 2022, attractive business environment, and focus on innovation and technological capabilities.
In 2022, the UAE’s GDP experienced a 7.9% growth rate, outperforming other countries that faced weak growth after the post-Covid boom in 2021. The FDICI report predicts that the UAE will maintain steady growth in 2023 and 2024, with growth rates of 3.2% and 4.8% respectively.
Rudolph Lohmeyer, partner at Kearney Middle East’s national transformations institute, highlighted the significance of the recently launched $8.7 trillion Dubai Economic Agenda (D33) in making the UAE an exceptionally attractive destination for investors. The ambitious economic plan aims to boost trade, investment, and elevate the UAE’s status as a global hub. Lohmeyer also praised the UAE government’s commitment to diversifying the economy and strengthening the country’s business environment.
Other Middle Eastern countries, including Qatar and Saudi Arabia, also performed well in the FDICI Emerging Markets ranking, placing 18th and 21st globally. Qatar’s rise was driven by hosting the FIFA World Cup 2022 and its National Vision 2030, which aims to diversify the economy away from oil. Saudi Arabia’s strong performance was attributed to an 8.7% GDP growth in 2022, pro-business reforms, a healthy fiscal outlook, and progress in economic diversification.
The FDICI report revealed that 82% of investors plan to increase their FDI in the next three years, expressing cautious optimism about the global economy. The United States continues to be the top-ranking country for FDI, followed by Canada, Japan, Germany, the United Kingdom, and France.
The report also noted that 66% of business leaders anticipate an increase in globalization in the next three years, driven by digital infrastructure and growing trade opportunities with limited barriers. However, they expect the nature of globalization to shift, with more regionalization and national governments pursuing strategies to increase self-sufficiency.
