Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
Abu Dhabi attracted 42 greenfield Foreign Direct Investment (FDI) projects worth $595.8 million in the first half of 2025, while the UAE as a whole registered 613 greenfield projects drawing capital inflows of $5.42 billion, according to a research report released by Emirates NBD.
The capital’s FDI performance complements broader national trends, with Dubai continuing to lead the pack, attracting 526 projects valued at $3.03 billion. Sharjah came in second with 24 projects worth $1.47 billion—remarkable for the high average project size—followed by Ras Al Khaimah (RAK), which drew six projects totalling $188.6 million.
A significant component of the UAE’s FDI momentum is the establishment of 34 new regional headquarters, representing a combined investment of $386.1 million.
The report said this “underscores the UAE’s growing importance as a regional business hub”, as more multinational corporations view the UAE as a launchpad for operations across the Middle East and beyond.
“In H1 2025, the convergence of technology and sustainability emerged as a key investment theme,” Emirates NBD noted in its commentary.
The communications sector—particularly data centres and AI infrastructure—garnered $359.5 million across 16 projects. Notable developments include Microsoft’s partnership with Core42, a G42 subsidiary, to build sovereign cloud and AI infrastructure aligned with Abu Dhabi’s 2025–2027 strategy to become the world’s first AI-native government.
In May, G42 announced Stargate UAE, a 5GW AI data centre campus involving global technology heavyweights such as OpenAI, Nvidia, Cisco, SoftBank, and Oracle. The first phase, comprising 200MW, is scheduled for delivery by 2026.
Free zones accounted for $1.62 billion—or nearly 30%—of total FDI inflows in H1 2025, despite hosting just 17.5% of total projects. This reveals their attractiveness for large-scale ventures.
Leading the charge was Jebel Ali Free Zone with $474.1 million in investments, followed by Dubai South with $280.9 million, Al Hamra Industrial Zone ($127.1 million), and Dubai Industrial City ($114.4 million). Dubai International Financial Centre attracted $89 million in financial services projects.
“This concentration of high-value investments underscores free zones' appeal for capital-intensive operations,” the Emirates NBD report said.
“Free zones' 100% foreign ownership, tax exemptions, streamlined licensing, and world-class infrastructure continue to prove particularly attractive for manufacturing, technology, and logistics sectors,” the report added.
Sector-wise, business services led in project count with 183 projects, primarily in professional services, consulting, and waste management. Software and IT services followed with 108 projects, while financial services recorded 65. Transportation and warehousing secured 42, and industrial equipment attracted 39 projects.
While the real estate sector saw only 29 greenfield FDI projects in H1 2025, it led in capital investment, drawing $1.05 billion—largely driven by a $953 million mixed-use development in Sharjah by Kuwait Real Estate Company and IFA Hotels. Other notable investments included a $346.6 million polyethylene film recycling plant in Sharjah by Italy’s Greenthesis Group and the UAE’s BEEAH, and a $127.1 million adhesives facility by H.B. Fuller in RAK’s Al Hamra Industrial Zone.
Manufacturing activities attracted $1.06 billion in FDI across just 22 projects, indicating a strategic focus on high-value sectors such as automotive, chemicals, and advanced materials. Construction projects, limited to just three, drew a significant $1.12 billion.
The report also noted strong activity in sales and marketing operations, which accounted for 217 projects with comparatively modest capital inflows of $500 million.
The UK emerged as the leading source of greenfield FDI projects in H1 2025 with 120 projects, followed closely by India with 101 and the US with 94. However, in terms of capital investment value, Kuwait led with $955.7 million from just three projects—almost entirely driven by the $953 million investment by Kuwait Real Estate Company in Sharjah project.
The US ranked second with $889.5 million, while India came third with $677.9 million. China contributed $413.2 million across 16 projects, and Italy invested $387.6 million through 18 projects.
