FDI Attraction Policies in Middle East

Author(s)

Immanuel Giovanni Cicala , Vincenzo Palumbo ,

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Volume 13 - November 2024 (11)

Abstract

The policies aimed at attracting investments in the Middle Eastern market have undergone significant evolution in recent decades, reflecting the growing importance of Foreign Direct Investment (FDI) as a key tool for economic diversification and sustainable development. Governments, aware of the need to reduce dependence on natural resources, have implemented a series of strategies and reforms to create a more favorable environment for foreign investments. One of the most emblematic examples is that of the United Arab Emirates, which has developed free zones and economic cities like Dubai and Abu Dhabi, offering tax incentives, wholly foreign ownership, and cutting-edge infrastructure. Saudi Arabia, with its ambitious Vision 2030 plan, aims to transform itself into a global economic hub by opening key sectors such as tourism, entertainment, and renewable energy to international investors. Other countries like Qatar, Bahrain, and Oman are following a similar trajectory, adopting proactive policies to attract FDI. These countries offer competitive advantages such as relatively low operating costs, a strategic geographic location, and access to expanding markets. However, despite these advancements, there are still significant challenges that need to be addressed to further enhance FDI attractiveness. Political stability, regulatory transparency, investor protection, and the fight against corruption are crucial issues that governments must continue to manage carefully. Additionally, it is important to note that the regions are characterized by great economic and social diversity. Some countries are highly developed, while others are still developing and face significant challenges in terms of economic, social, military, and energy-related issues.

Keywords

FDI, Middle East

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