Middle East investors favour the UAE and shun Syria

DubaiThe UAE followed by Saudi Arabia and Qatar offer the best investment opportunities in the Middle East and North Africa, according to regional investors.

In contrast, war-torn Syria scored worst for investor sentiment, followed by Lebanon and Jordan.

Investors were slightly positive on Bahrain, the only Gulf state to witness significant unrest in recent months, and slightly negative on Egypt, which is undergoing a fraught transition to democracy after years of one-party rule.

The survey by FTSE Global Markets found that political risk and liquidity were the top concerns for the 90 investment firms who participated.

The report authors suggest continued unrest in Syria and the surrounding area is likely to concentrate assets in economies that have not faced political upheaval.

“Heightened political risks in the Mena [Middle East and North Africa] region have two effects: the concentration of assets in those countries that are deemed more stable, and a shift in the types of assets employed,” says Andrew Neil, head of research and new media, FTSE Global Markets.

“It is no surprise then that in the more stable markets in the GCC investors are increasingly looking at equity-based investments and in the riskier markets in the North Africa and Levant bonds seem to be the investment vehicle of choice, particularly the relatively safe haven of sovereign bonds.”

©2013 funds europe