Report shows decline in FDI flows across Arab countries

Jordan Daily – The Arab Investment and Export Credit Guarantee Corporation, (Dhaman) has revealed a slight decline in foreign direct investment (FDI) flows to Arab countries during the past year, amounting to approximately $54 billion, representing a 3% decrease.

The decline in FDI flows in the Arab world aligns with the global trend, with global FDI falling by 12.3% to $1.3 trillion. The global decrease can be attributed to factors such as the ongoing Russian-Ukrainian war and its impact on the global economy, increasing inflationary pressures, and tighter financial conditions in most countries around the world.

According to the corporation’s annual report, Arab countries accounted for around 4.2% of global FDI flows and 6% of FDI flows to developing countries last year, maintaining the geographical concentration of inflows to the Arab region.

The top three countries attracted around 78% of total FDI flows, with the United Arab Emirates leading the way by attracting $22.7 billion, accounting for 42.3% of the total. Egypt followed with $11.4 billion, capturing 21.2% of the total, while Saudi Arabia ranked third with approximately $8 billion, representing 14.7% of total inflows.

Oman ranked fourth with a value of $3.7 billion and a share of 6.9%. Morocco, Bahrain, and Mauritania secured the fifth, sixth, and seventh positions, respectively, with values of $2.1 billion, $2 billion, and $1.1 billion.

This data underscores the varying levels of attractiveness and investment opportunities within the Arab region, with some countries attracting a larger share of FDI inflows than others. It also highlights the need for concerted efforts to enhance investment climates and attract more foreign investments to promote economic growth and development across the Arab world.