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Confidence in Dubai as Regional Foreign Investments Hub Increases

Dubai : 07 September 2010

Over 70 percent of investors who took part in the survey in the region and worldwide have investments or plans to invest in Dubai

Dubai is still viewed as a prime spot for foreign direct investments (FDI) and holds the leading place for these investments in the larger Middle East and North African (MENA) region.  Preliminary survey figures show that confidence in Dubai is growing.

The survey was handled by an agency of the Department of Economic Development (DED), the Foreign Investment Office (FIO), and reveals that over 70 per cent of local investors and those worldwide hold investments in Dubai or are planning to do so over the next three years.

There were over 1,000 investors surveyed from the region and across the globe.

Early analysis finds that 54 per cent of those surveyed are already investing in Dubai while 16 per cent more, both foreign and regional investors, plan to do so within three years time.  Many of these firms view Dubai as vital to gain access into the wealthy markets of MENA and retain an important and tactical presence there.

The wider MENA area includes an expanding workforce and a booming market of consumers numbering 1.7 billion.  Filled with a young and energetic population, many of the region’s residents are under 25 years old.

It is predicted by the International Monetary Fund (IMF) that the MENA region will experience 5.5 per cent growth in the GDP.  This expectation, along with the make up of the population, place MENA in an attractive light for foreign investments.

FDI flowing into the Middle East has grown dramatically over the last decade.  The region of the Gulf Cooperation Council (GCC) has seen FDI grow to $62 billion in 2008, up from $3 billion in 2000, as reported by the United Nations Conference on Trade and Development (UNCTAD).

FDI Intelligence reports that $21 billion of investments flowed into the UAE in 2008, which is a firm indicator of investor confidence.

This is encouraging, according to the CEO of the Foreign Investment Office.  Fahad Al Gergawi notes that with FDI flowing into Dubai, confidence remaining high and a positive outlook in terms of regional growth, the Emirate looks to have rebounded and will climb to the top of FDI destinations for investors worldwide.

Investors who were interviewed stated that Dubai is growing in economic maturity and becoming more attractive.

This outlook is anchored on Dubai creating a well built infrastructure and maintaining the innovative and business savvy advancements the area is known for.  The confidence investors have is based on Dubai’s historically stable performance in a variety of sectors.

A 2010 report from the AT Kearney FDI Confidence Index supports the position of Dubai, placing the UAE as the top country and Dubai as the Middle East’s preferred FDI location.  Dubai’s leading infrastructure, superior logistics facilities, smooth business dealings and safe environment cause it to stand above the crowd.

Investors look at Dubai as an entrance into the highly sought after MENA region.

Paul Holdsworth, Staff Writer, Gulf Jobs Market News
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