Arab News, Tuesday, Jan 17, 2023 | Jamadi Al Thani 24, 1444
Saudi Arabia to surpass UAE in receiving FDI in 2023: Report
Saudi Arabia is expected to surpass the UAE in receiving foreign direct
investment in 2023, for the first time since 2012, as both nations continue to
be major beneficiaries of the inflow of funds, a recent industry report showed.
According to the Lumina Cross-Border insights
report, FDI into Saudi Arabia and the UAE hit record highs with $40 billion in
2022, showing a rise of 58 percent over the previous year.
“Key MENA projects driving FDI and UK-to-Middle
East investment in 2023 will include infrastructure and engineering, tourism and
hospitality, and clean/renewable energy, most notably, the megaprojects in Saudi
Arabia,” stated the report.
For instance, Saudi Arabia’s top seven
infrastructure projects will cost $690 billion to construct. These schemes are
NEOM, ROSHN, Diriyah Gate, Jeddah Central, Red Sea Project, AlUla, and
It added: “Regional presence for aspiring global
firms to take advantage of such growth is now seen as a must rather than a
The report further predicted that the two-way
investments between the Middle East and Europe will drive record FDI levels in
“As global corporates and funds increasingly set
up roots in the region, with talent continuing to move in, 2023
is anticipated to be another record year for FDI in the Middle East.”
It said that deal-making is also expected to
flourish due to a largely resilient regional-led global mergers and acquisitions
environment last year.
The report also predicts a significant change in
existing partnerships in the region as firms in the UK will reassess joint
ventures in the Middle East to determine their relevance today.
“2023 will be a tale of two halves, with H1 seeing
highly active Middle East corporates and funds continuing to invest into
European companies, as domestic markets continue to face varying levels of
economic turbulence. This will create a myriad of investment opportunities to
diversify globally and gain access to best-in-class skills and talents,” said
Andrew Nichol, partner at Lumina Capital Advisers.
He added: “In H2 we anticipate improving sentiment
across developed markets, which will drive global demand for natural resources,
oil included. The region is extremely well positioned for yet another strong