Dubai expected to attract higher FDI in 2014
Dubai is expected to achieve between ten per cent and 15 per cent growth in foreign direct investment (FDI) this year, marking an increase versus 2013, according to the government.
The increase will be buoyed by growth across different sectors, including tourism, services and logistics.
In 2013, Dubai's direct foreign trade totalled $230.46 billion (£147 billion), marking a 4.7 per cent increase compared to 2012, according to Business Year's 'UAE, Dubai 2014' report. Over 64.4 per cent of this was made up of imports, 14.9 per cent by exports and 20.7 per cent from re-exports.
The UAE's FDI is expected to be valued at $14.4 billion in 2014, up 20 per cent from $12 billion in 2013. It is clear that investors are flocking to Dubai to take advantage of the fact that it is tax-free and perceived as a 'safe haven' by many.
In the report, Fahad Al Gergawi, chief executive of Dubai FDI, the foreign investment office in the emirate’s Department of Economic Development (DED), said: 'The focus on growth [is] coming with mega projects that have been announced by the government.'
He added that the government expects FDI to grow by up to 15 per cent this year compared to that achieved in 2013, but declined to provide a forecast for next year.
The emirate's FDI is likely to reach AED4 trillion (£694 billion) due it providing the winning bid for the World Expo 2020 - a six-month trade event that is expected to attract 25 million visitors, 17 million of which will be international.
According to Business Year's 'UAE, Dubai 2014' report, the Expo could 'open up investment opportunities for domestic and foreign firms alike'. Projects worth AED30 billion will be built across the emirate, enhancing its infrastructure in preparation for the event.
Furthermore, the Expo is expected to create up to 100,000 new jobs between 2015 and 2021, adding 0.5 to 0.6 percentage points to Dubai's gross domestic product (GDP), which grew 4.6 per cent in 2013. The report notes that the DED is expecting GDP growth to rise by 4.7 per cent in 2014.