Beirut (AsiaNews) Foreign Direct Investment (FDI) to the Mideast rose by 51 per cent in 2004 but the surge was still far lower than the entire Asian continent, according to the 2005 Report of the United Nations Conference on Trade and Development (UNCTAD).
Investments to the region Mideast reached US$ 9.8 billion but only represented 7 per cent of Asia's total FDI.
Turkey and Saudi Arabia were by far the biggest recipients with US$ 2.7 billion and slightly less than US$ 2 billion respectively.
Syria received US$ 1.2 billion in FDI in 2004, an increase of 11.3 per cent over the previous year. By comparison, Lebanon, which receives barely more than a fifth of the amount invested in Syria, witnessed a decrease of 19.6 per cent in 2004 compared to 2003.
UNCTAD officials said that, because of high oil prices, oil producing countries in the region had excessive liquidity soaked up in mergers and acquisitions as well as real-estate projects.
Since the petroleum industry and electricity and telecommunication are the main strategic sectors in the region and are closed to foreign investors, it is "no wonder the region sill lags behind the rest of the world," said Lebanese Economy Minister Sami Haddad, who was present at the launching. "Only Egypt and Pakistan are starting to open up these sectors," he added.
With 36 per cent of all FDI going to developing countries the declining trend of the last three years was reversed in 2004, the report noted.
Seven of the ten economies with the largest increases in FDI were developing or transition economies, while the ten largest declines were in developed countries.