UAE foreign direct investment hits record $48.3bn in 2025, ranked ninth globally
UAE foreign direct investment reached $48.3bn (AED177.3bn) in 2025, a 6% increase year-on-year, placing the country ninth worldwide as greenfield projects and AI infrastructure boost inflows.
The United Arab Emirates attracted $48.3 billion (AED 177.3 billion) in foreign direct investment (FDI) in 2025, marking a fourth consecutive year of record inflows and a 6 percent increase from 2024. This performance placed the UAE ninth globally for FDI inflows, while overall FDI stock in the country rose to AED 1.17 trillion, underscoring sustained investor confidence in the Emirates’ long-term economic strategy.
UAE Posts Record FDI Inflows in 2025
Sheikh Mohammed bin Rashid Al Maktoum highlighted the figures as evidence of the country’s appeal to global capital, noting both the rise in annual inflows and the increase in cumulative FDI stock. The government attributes the performance to a combination of strategic policy frameworks, infrastructure investment and targeted incentives aimed at facilitating new projects and reducing barriers to entry for foreign investors.
The Ministry of Investment’s 2026 report shows the country advanced to ninth place worldwide for inbound FDI and maintained second place globally for the number of greenfield projects, a metric that signals long-term productive investment rather than short-term portfolio flows. Authorities say these outcomes reflect a deliberate effort to attract capital that supports diversification, technology adoption and job creation.
Greenfield Projects Drive Capital Commitments
Greenfield investment remained dominant, accounting for roughly 45 percent of incoming FDI, with 1,562 new projects announced in 2025 and total greenfield capital expenditure of $34.1 billion (AED 125.2 billion). These greenfield commitments represented about 1.8 percent of global greenfield CAPEX for the year and reinforced the UAE’s role as a hub for new industrial and digital capacity.
Top sectors for these projects included manufacturing, which captured 30 percent of announced greenfield activity as authorities pursue onshoring and advanced production capacity. Telecommunications projects accounted for 29 percent, propelled by major initiatives such as the “Stargate UAE” AI computing hub in Abu Dhabi developed with domestic partners, while real estate investment accounted for some 7 percent as the country continues to draw talent and high-net-worth residents.
Employment and Sectoral Impact of New Projects
The 2025 wave of greenfield projects is estimated to have created more than 65,000 direct jobs across a mix of industries including transport and logistics, business services, software and IT, automotive manufacturing, financial services and telecoms. Officials say these employment gains support broader economic diversification goals by bolstering higher-value sectors and supply-chain capabilities.
Beyond immediate hires, capital committed to new facilities and digital infrastructure is expected to generate spillovers that strengthen local supplier networks and skills development, while improving the investment climate for future rounds of inward capital. The mix of capital-intensive projects and knowledge-driven investments points to a maturing ecosystem that can absorb larger and more complex foreign partnerships.
Changing Composition of FDI and Startup Momentum
The structure of incoming FDI showed more balance in 2025, with mergers and acquisitions accounting for about 8 percent of flows and reinvested earnings making up roughly 11.2 percent. This diversification of entry modes reflects both deal activity and growing confidence among foreign companies in the UAE as a regional base for expansion and retained earnings reinvestment.
Start-up financing also showed notable maturation, with average round sizes increasing to roughly $9.2 million as companies moved beyond seed stages into scaling phases. Observers point to an expanding pipeline of growth-stage ventures and larger-ticket venture investments that complement traditional project-based FDI, strengthening the country’s innovation and tech landscape.
Regional Leadership and Global Context
The rebound in UAE inflows came amid a broader recovery in global FDI, which rose to an estimated $1.6 trillion in 2025 after several years of decline, concentrating capital in a smaller set of economies and sectors. The Middle East, North America and Western Europe led regional growth, and the UAE emerged as a principal driver for the Middle East’s surge in greenfield CAPEX.
UNCTAD and national reporting indicate the Middle East led global growth in foundational greenfield investment with growth of 72.4 percent, and the UAE contributed an estimated 38 percent of the region’s greenfield capital expenditure. Analysts say the concentration reflects investor preference for stable regimes, attractive regulatory frameworks and projects tied to digital and industrial transformation.
Policy Targets and the National Investment Strategy 2031
The results align with the UAE’s National Investment Strategy 2031, which sets explicit targets to raise annual FDI inflows to $65 billion (AED 240 billion) and grow cumulative FDI stock to $600 billion (AED 2.2 trillion) by 2031. The strategy frames these targets as part of a long-term plan to anchor the country among leading global investment destinations and to channel capital into priority sectors.
To support those aims, the Cabinet approved the creation of a National Investment Fund in November 2025 with initial capital of $10 billion (AED 36.7 billion), intended to catalyse larger strategic projects and enhance the country’s investment pipeline. The Ministry of Investment says it will continue to refine policies, lower entry barriers, expand bilateral ties and work closely with federal and local partners to sustain momentum and attract diverse sources of capital.
Looking ahead, officials and market participants say maintaining regulatory clarity, expanding bilateral partnership frameworks and continuing to scale digital and industrial projects will be central to meeting the 2031 targets. The mix of larger greenfield commitments, stronger startup funding and a targeted sovereign fund puts the UAE in a position to deepen its role as a regional investment hub while supporting national diversification and employment goals.