Economy

Sharjah to quadruple FDI to $10bn

July 14, 2024, 1:21 PM

Before 2022 only UAE and GCC nationals had the right to own freehold property in Sharjah

Leap to $2.75bn in 2023
Fifth-fastest growth globally
GDP up 6.5% in a year

Sharjah is aiming to quadruple the level of foreign direct investment into the emirate over the next five years.

The third largest of the seven emirates in the UAE, behind Dubai and Abu Dhabi, Sharjah reported a 140 percent jump in FDI between 2022 and 2023, to $2.75 billion, with 19 new greenfield projects launched.

Total FDI for the UAE was almost $31 billion last year.

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Data from fDi Markets shows that in 2023 Sharjah, with a population of 1.8 million, ranked as the fifth-fastest growing city globally in attracting overseas investment.

Mohamed Al Musharrakh, CEO of Sharjah FDI Office, told AGBI he expected FDI to double this year through 25 new projects.

“I think in five years we want to see this figure reaching around $10 billion,” he said.

Sharjah’s GDP increased by 6.5 percent in 2023, reaching close to AED145 billion ($40 billion). Al Musharrakh said he believed this would increase by a further 7 percent this year.

“A lot of inflows are coming,” Al Musharrakh said.

Almost all – an estimated 96 percent – of Sharjah’s GDP comes from non-oil activity.

Al Musharrakh said strong levels of investment were coming from countries within the Gulf Cooperation Council (GCC) as well as India, the UK and Germany.

“A lot of new Chinese investments are coming in manufacturing,” he said.

Private sector to propel Sharjah’s economic growth

China is the UAE’s largest trade partner, with bilateral trade reaching about $95 billion in 2023.

In May the Sharjah Research, Technology and Innovation Park conducted a number of high-level meetings in main Chinese cities, while Chinese delegations visited SRTI Park to explore investment avenues.

More than 700 Chinese companies operate in Sharjah’s markets and free zones.

The emirate currently operates seven free zones, with the addition of the Sharjah Communication Technologies Free Zone in Kalba city, announced earlier this month, which will fall under the umbrella of the Sharjah Communication Technologies Authority.

Sharjah has a particular focus on seven different sectors: advanced manufacturing, healthcare, tourism, green technology, transportation and logistics, human capital and innovation, and culture and tourism.

“We are focusing on advanced manufacturing. We want to attract more companies in technology,” said Al Musharrakh.

“Sharjah has been traditionally the manufacturing hub of the UAE, but now with more focus on technology, with having the Sharjah Research and Technology Park, with the labs that they have, the access to knowledge they have from different universities, the talent pool that these companies within the park attract from the American University of Sharjah, Sharjah University, I think we will be able to attract a lot of technology companies over there.”

The law was changed in 2022 to allow all nationalities to own freehold property in Sharjah. Prior to the change, only UAE and GCC nationals had that right, and other foreigners were limited to certain properties for a maximum of 100 years.

The legal shift triggered a boom in the emirate’s real estate transactions and a jump in non-Arab investors of 165 percent, local authorities said in January.