Barriers and Opportunities for Enhancing Capital Flows
In the COMCEC Member Countries
20
from Europe in 201025, and within the high-income group, Saudi Arabia remained the
country with the highest FDI flows in 2012.
Figure 1.9: Magnitude of FDI flows by range for the COMCEC Member Countries within
the high-income group, 2012
Source: UNCTAD World Investment Report 2013
The UAE has recently become a regional hub for capital inflows, overtaking Saudi Arabia and
Qatar in 2013. FDI inflows to the UAE have rebounded from the US$4bn recorded in 2009,
amid Dubai’s declining property market, to reach US$9.6bn in 2012. Despite this, inflows
remain low relative to the period from 2004 to 2007, during which capital inflows had
tripled26. Currently, the UAE and Saudi Arabia together account for 83% of FDI.
1.3. GLOBAL CARITAL OUTFLOWS- A SNAPSHOT
In the last decade, many emerging market companies have expanded rapidly, enabling some to
start engaging in mergers and acquisitions (M&A) activity in other developing and developed
countries. Gross FDI outflows from emerging market economies had risen to $205bn by 2006
from $43bn in 2002. By the end of 2006, the total holdings of foreign assets by major emerging
market economies, excluding China, had reached $6.7trn, compared with $3.2trn in 2001.
The rise in foreign assets and foreign liabilities of many major emerging countries clearly
shows that developing countries are playing an increasingly important role in financial
globalisation.27 According to the UNCTAD World Investment Report (2013), developing
countries now account for one-third of global FDI outflows – a proportion that is rising. In
contrast, FDI outflows from developed countries as a whole fell by 23% in 2012, with outflows
from 22 out of 38 developed countries declining.
25
“Economic Prospects and Policy Challenges for the GCC Countries”, IMF, October 2012
26 Ibid.
27 “Capital flows in emerging market economies”, Bank for International Settlements (BIS), 2009
HIC (7) FDI flows, 2012
Saudi Arabia >$10bn ||||||||||||||||||||||||||||||||||||||||
UAE $5.5-9bn |||||||||||||||||||||||||||||
Kuwait $1-4.9bn |||||||||||
Oman $1-4.9bn |||||||||||
Bahrain <$1bn ||
Brunei $0.1-0.9bn ||
Qatar <$1bn ||