Algeria 
Bahrain 
Egypt 
Iran 
Iraq 
Israel 
Jordan 
Kuwait 
Lebanon 
Libya 
Morocco 
Oman 
Palestine * 
Qatar 
Saudi Arabia 
Syria 
Tunisia 
United Arab Emirates 
Yemen Emergence of strategic sectors but still limited efficiency: Study looks at trends of foreign investment in the Mediterranean
November 30, 2016
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An analysis of the trends of foreign investment and business partnerships in the Mediterranean released recently, has revealed that MED countries attracted a growing number of Foreign Direct Investment (FDI) projects in strategic sectors but the FDI level remains below the performance expected. The study was carried out as part of the Mediterranean Investment and Partnership Observatory (MIPO observatory), created under the EU-funded EUROMED Invest project.
According to the study, MED countries have attracted a growing number of Foreign Direct Investment (FDI) projects in strategic sectors for the region: software, automotive, medicine, agribusiness, renewable energies, transport, logistics, etc. But the FDI level remains below the performance that could be expected from the region, given the weight of its GDP or population.
Financial crisis, economic crisis and Arab spring have not ruled out the attractiveness of MED countries: they attracted 2 to 3% of foreign investment in the world during the decade 2006-2015, compared to 1% in 2000. Despite the many reforms that have improved the business climate, the performance of the MED countries did not meet their expectations: not enough investment, value creation and in fine not enough job creation in the region marked by high unemployment, notably within an increasingly graduated youth.
However, there are also encouraging trends such as the sectoral rotation of foreign investment towards sectors with higher added value, creating more direct employment in the short term. In terms of origin, Europe leads with almost half of the FDI projects announced over 10 years, but powerful challengers have emerged and are gaining ground, BRICS (Brazil, Russia, India, China and South Africa) and Asia in the lead.
Finally, MED countries’ national performances are very diverse: Israel and Turkey are the regional champions, followed in Northern Africa by Egypt and Morocco, respectively 2nd and 5th most attractive African countries in 2015. Jordan and Lebanon are the most performing countries in the region in terms of FDI / GDP and FDI / population ratio, but they suffer from regional instability.
The aim of the EUROMED Invest project is to boost private business and investment within the Euro-Mediterranean region to contribute to inclusive economic development. The project’s activities aim to empower Euro-Med business and investment networks to implement targeted strategies in support of SME development in specific sectors: agri-food, water and alternative energies, tourism, transport and logistics, cultural and creative industries.
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