RIYADH: Saudi Arabia is expected to surpass the UAE in receiving foreign direct investment in 2023, for the first time since 2012, as both nations continue to be major beneficiaries of the inflow of funds, a recent industry report showed. According to the Lumina Cross-Border insights report, FDI into Saudi Arabia and the UAE hit record highs with $40 billion in 2022, showing a rise of 58 percent over the previous year. “Key MENA projects driving FDI and UK-to-Middle East investment in 2023 will include infrastructure and engineering, tourism and hospitality, and clean/renewable energy, most notably, the megaprojects in Saudi Arabia,” stated the report. For instance, Saudi Arabia’s top seven infrastructure projects will cost $690 billion to construct. These schemes are NEOM, ROSHN, Diriyah Gate, Jeddah Central, Red Sea Project, AlUla, and Qiddiya. It added: “Regional presence for aspiring global firms to take advantage of such growth is now seen as a must rather than a nice-to-have.” The report further predicted that the two-way investments between the Middle East and Europe will drive record FDI levels in 2023. “As global corporates and funds increasingly set up roots in the region, with talent continuing to move in, 2023 is anticipated to be another record year for FDI in the Middle East.” It said that deal-making is also expected to flourish due to a largely resilient regional-led global mergers and acquisitions environment last year. The report also predicts a significant change in existing partnerships in the region as firms in the UK will reassess joint ventures in the Middle East to determine their relevance today. “2023 will be a tale of two halves, with H1 seeing highly active Middle East corporates and funds continuing to invest into European companies, as domestic markets continue to face varying levels of economic turbulence. This will create a myriad of investment opportunities to diversify globally and gain access to best-in-class skills and talents,” said Andrew Nichol, partner at Lumina Capital Advisers. He added: “In H2 we anticipate improving sentiment across developed markets, which will drive global demand for natural resources, oil included. The region is extremely well positioned for yet another strong year ahead.”