United Arab Emirates (U.A.E. The United Arab Emirates (U.A.E.) has committed to investing PS10 billion ($13.8 million) into the U.K. within the next five years. This boosts the London government, which had seen inward investment decline steadily since 2016 when the country voted out the European Union.
The Abu Dhabi Crown Prince Mohamed Bin Zayed Al-Nahyan visited Prime Minister Boris Johnson in 10 Downing Street London on 16/09/12.
The new commitment follows a PS1Billion’sovereign partnership’ agreement between the U.K. Office for Investment and Abu Dhabi Mubadala Investment Company. Mubadala, along with the PS200 million Life Sciences Investment Program of the U.K. government, agreed to contribute PS800 million. In the future, new investments will be made in areas such as energy transition and technology.
Steady decline
These investments could be used to reverse the decline in foreign direct investment (FDI), which has been steadily declining since the Brexit vote five years ago. The total commitment is approximately 70% of all inward FDI to the U.K.
In 2016, the U.K. saw a record $259 Billion in inward investment flows. This was mainly due to a few significant merger and acquisition transactions, such as the takeovers at SABMiller and A.R.M. The figure fell to $96 Billion in 2017, $65 Billion in 2018, and only $45.5B in 2019.
In 2020, the figure dropped even more due to the Covid-19 pandemic. According to the U.N. Conference on Trade and Development (UNCTAD), it was down to $19.7billion. However, the U.A.E. It was. However, one of few countries to see an increase in outward FDI last year, going from $18billion in 2019 to $19.9billion in 2020. That puts it just ahead of the U.K.
FDI flows are volatile. The U.K. is now the least likely recipient of FDI flows. In 2005, it was the largest country to receive them. However, this has fallen to just 16 in 2014. It is currently in the middle of this range.
The U.K. saw a decrease in FDI over some period starting in 2016, but this was in line with global trends. However, the U.K. experienced a fall in inwards FDI in 2019, when international inward investments increased by 6.5% and flow into the 27 E.U. increased by 7.5%. The UNCTAD reports that countries experienced an increase in FDI of 9.5%.
Despite Brexit, investment ties between Britain and the E.U. are strong. The relationship between the U.K. and the E.U. remains strong, despite Brexit. As per the House of Commons Library Report, the U.S. is currently the largest single investor in the U.K.
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