GCC eyes bigger share of $1t global green FDI

The GCC stands at a crossroads in its economic diversification journey, with a new report showing the region has significant untapped potential to attract climate-aligned foreign direct investment (FDI).

- Issac John [e-mail]

While more than $1 trillion in global green FDI flowed into projects between 2020 and 2024, the UAE, Saudi Arabia, and Oman together captured just $24 billion — or 2 per cent — of the total. This modest inflow contrasts sharply with the $132 billion the three countries invested abroad in green projects over the same period, highlighting a gap the region is now determined to close.

The analysis by Strategy& Middle East, based on more than 100 large-scale FDI deals exceeding $1 billion each, categorises green investment into hydrogen and ammonia, renewable power, green industrials and chemicals, batteries, electric and hydrogen vehicles, sustainable construction, and carbon capture. The findings reveal that 53 per cent of all major cross-border investment in the period went into green sectors, with hydrogen, renewable power, and batteries alone accounting for 80 per cent of flows. The momentum peaked in 2022-2023 as post-pandemic recovery boosted climate-aligned spending, though inflows remained strong in 2024 at $158 billion, nearly triple the level of 2020.