Finance

UAE invests $2.5 trillion overseas, with US the top recipient

March 25, 2024, 1:39 PM

A cashier rings up products at a Walmart store in San Marcos, Texas. Gulf wealth funds invest in US household names such as Walmart and Starbucks

$115bn invested in United States
72% from sovereign wealth funds
Egypt is second on list with $65bn

The UAE has invested an estimated $2.5 trillion overseas as of early 2024, with the United States the prime destination.

“The UAE has strengthened its position in the global economy,” Jamal bin Saif Al Jarwan, secretary-general of the UAE International Investors Council, was quoted as saying by the state-owned Wam news agency.

“It ranked first in the Arab region and West Asia and 15th globally.”

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About 72 percent of the money comes from the Emirates’ sovereign wealth funds.

The US has attracted $65 billion in bonds and $50 billion in direct investments, according to the council.

It is followed by Egypt on $65 billion, the UK and India, which each attracted $40 billion, and Morocco on $30 billion, though the organisation did not provide breakdowns of those figures.

Al Jarwan said the UAE’s investments abroad were performing well despite global economic fluctuations.

“We are currently operating in 90 countries,” he added.

“I expect India, Indonesia, ASEAN countries, Egypt, Morocco, Central Asian countries, Britain, France, Germany, the United States, Canada, some Eastern European countries especially Serbia, Greece and Turkey to be the focus of our attention.”

Most sovereign wealth funds in the Gulf remain heavily invested in the US while China represents a much smaller part of their portfolios, AGBI reported earlier this month, citing data from the consultancy Global SWF.

For example, 52 percent of the Abu Dhabi Investment Authority’s assets are in the US, against 5 percent in China.

Last month another Abu Dhabi wealth fund, ADQ, announced that it would pump $35 billion into building a resort city in Egypt, with the aim to transform it into “one the most important tourism destinations on the Mediterranean Sea and in the world”.

Apart from sovereign wealth funds, government-owned and quasi-governmental companies accounted for 18 percent of investments overseas. Another 7.5 percent came from family-owned and private companies while UAE banks accounted for 2.5 percent.

Al Jarwan said overseas investment had soared in the past few decades, rising from $1.9 billion during the period 1991-2000 to $53.6 billion in 2001-2010. By 2022 this figure had risen to $240 billion.