Al-Shal Report: 2025 Records Highest Outflow of Funds from Kuwait in Five Years
A report issued by Al-Shal Economic Consulting stated that the 2025 Foreign Direct Investment (FDI) Flows report from the United Nations Conference on Trade and Development (UNCTAD) has been released. In this section of our report, we will focus on FDI flows in the Gulf Cooperation Council (GCC) countries.
The Al-Shal report clarified that aggregate figures indicate that inbound FDI flows to each GCC country last year reached approximately $98.5 billion, an 18.2 percent increase over inbound flows in 2024. Meanwhile, outbound FDI flows totaled approximately $130.4 billion, resulting in a deficit of about $31.9 billion in favor of outbound flows.
On a country-by-country basis, the United Arab Emirates (UAE) received the largest share of inbound flows, amounting to approximately $48.2 billion, up from $45.6 billion in 2024. Saudi Arabia received approximately $32.6 billion, up from $21.3 billion in 2024, followed by Oman with $13.3 billion, up from approximately $12.5 billion in 2024. Together, these three countries accounted for approximately 95.6 percent of total inbound FDI flows to the GCC.
The remaining three countries, which received smaller shares, were Qatar with approximately $3 billion, Bahrain with approximately $821 million, and Kuwait with approximately $497 million. These three countries collectively accounted for 4.4 percent of total inbound flows.
Regarding outbound FDI flows, the UAE led with approximately $63.4 billion, followed by Kuwait with approximately $36 billion, and Saudi Arabia with approximately $27 billion. These three countries accounted for approximately 96.9 percent of total outbound flows.
The other three countries, which had lower outbound capital flows for direct investment, saw Qatar leading with approximately $3.3 billion, followed by Bahrain with approximately $550 million, and Oman with approximately $181 million. These three countries accounted for approximately 3.1 percent of total outbound flows.
Over the longer term, covering the period from 2021 to 2025, total inbound FDI flows to the six GCC countries amounted to approximately $374.9 billion, while total outbound FDI flows reached approximately $432.4 billion. The UAE received approximately 44.8 percent of these inbound flows, followed by Saudi Arabia with 35.2 percent, Oman with 14.4 percent, Bahrain with 3.9 percent, Kuwait with 1.2 percent, and Qatar with 0.5 percent.
Al-Shal noted that returning to our focal point, Kuwait, whose figures appear concerning—particularly in the most recent year, 2025—shows that inbound FDI flows decreased by approximately 70.9 percent in 2024 compared to 2023, and fell further by approximately 19.1 percent in 2025 compared to 2024, despite being the lowest among the five other countries.
However, a more alarming development is that outbound direct investment flows to the rest of the world reached approximately $36 billion, or about 3.5 times the outbound flows in 2024. This can be classified as capital flight or exodus, with the value reaching approximately 72.4 times the inbound flows.
Over the past five years, Kuwait received approximately $4.5 billion in inbound foreign investments, while it exported approximately $86.7 billion in direct investment capital abroad. This resulted in a deficit between inbound and outbound flows of approximately $82.2 billion in favor of outbound flows, with the highest outbound flows occurring in 2025.
Al-Shal clarified: “This is the reality of Kuwait’s business environment and how extremely poor it is at attracting foreign investment, and how it repels domestic capital, driving it to invest elsewhere. The figures are unequivocal; they do not flatter, nor do they lie, and no amount of interviews with global multinational institutions and companies can compensate for this.”
The report emphasized that while attracting foreign capital is a positive development, the priority should be to examine the reasons behind the exodus of domestic capital to settle abroad. Unless there is a partial and gradual shift in the mindset of local capital owners toward stability in their homeland, it is only natural that the reception of foreign capital will remain scarce, and perhaps even fall below the cost of the incentives offered to attract it.
