UAE seeks investment in various sectors to diversify economy

Country is encouraging investment in scientific research, logistics, health care, food security and renewable energy, says minister of state for foreign trade

The UAE is emerging as a model for economic growth, not only for the region but for the whole world, said Dr Thani Al Zeyoudi, Minister of State for Foreign Trade. Pawan Singh / The National

The UAE aims to attract investment in a number of new sectors to diversify its economy away from oil, the country’s Minister of State for Foreign Trade said.

“As the UAE strives to push forward its economic diversification agenda, we are encouraging investments in scientific research, logistics, health care, food security, manufacturing and advanced technologies, and renewable energy, among many other areas,” Dr Thani Al Zeyoudi told the World Investment Forum on Tuesday.

“Additionally, we are focused on driving innovation and empowering small businesses and start-ups by improving access to finance and encouraging public-private collaboration.”

The UAE, the Arab world's second-largest economy, is undertaking various measures to attract more FDI into the country. This year, it unveiled a new industrial strategy to boost the contribution of the industrial sector to Dh300 billion ($81.68bn) in the next 10 years from Dh133bn.

The country overhauled its commercial companies' law last year to attract more foreign capital and annulled the requirement for onshore companies to have an Emirati shareholder.

“The UAE today has all the makings of an ideal innovation hub complemented by advanced infrastructure and supportive legislative and regulatory frameworks,” Mr Al Zeyoudi said. “Through such forward-looking strategies, the country is establishing itself as a dynamic hub for advanced industries.”

The UAE economy is expected to grow 3.1 per cent in 2021, the International Monetary Fund said. That is higher than the Central Bank of the UAE's estimate, which projects the country’s economy will expand 2.1 per cent this year and 4.2 per cent in 2022.

“We are confident that our efforts in the current phase are key to strengthening the very foundation of our economy for the future by ensuring its ability to keep up with the sudden shifts in the global economic landscape,” Mr Al Zeyoudi said.

The country was “emerging as a model for economic growth … not only for the region but for the whole world”, due to its bold actions on the economic front, he said.

The UAE continues to attract investment in a number of sectors to boost its economy. The total foreign direct investments in the country surged 11 per cent in 2020 despite the pandemic.

The UAE climbed up in the inflow of FDI’s ranking to reach 15th position last year, Mr Al Zeyoudi said, citing the UN report. It also moved up six spots to 13th place in FDI outflow.

“These achievements can be attributed to many factors such as stability, modern infrastructure, effective economic policies and legislations, the UAE’s strategic location and open economy, free transfer of profit and revenues and assets, as well as a diverse modern tolerant society, among many others," he said.