Record Gulf investment brings hope, and worry, to workers

Money flowing into and out of the Gulf Cooperation Council countries reached record levels in 2025, and behind the figures sit real questions for the workers, businesses and communities who depend on where the next investment lands. A new report by UN Trade and Development (UNCTAD) finds that the region drew in more foreign capital than at any point in a decade, even as a mounting crisis in the Strait of Hormuz now threatens the momentum people across the region and beyond had begun building their plans around.

For those living in the economies doing the receiving, the shift was tangible. Foreign direct investment into GCC countries rose 18% to roughly $99 billion in 2025, well above the 6% growth recorded globally. Outward investment from the region climbed 11% to $130 billion, exceeding inflows by almost $31 billion. Announced greenfield investment, which captures firms’ plans to establish or expand operations, jumped 66% to around $78 billion, with project numbers up 12% at a time when such announcements fell 10% worldwide.

The benefits, however, have not been spread evenly across the communities of the six member states. The United Arab Emirates remained the largest recipient, attracting around $48 billion, while Saudi Arabia accounted for about three-quarters of the regional increase. Together, the two economies absorbed more than four fifths of all inflows into the GCC. UNCTAD attributes these differences to market size, international connectivity, and the way diversification programmes and investment reforms open opportunities for foreign investors, factors that help explain why investment, and the jobs and activity that follow it, cluster in some places rather than others.

Which industries attract the money matters to the people hoping to work in them. The information and communication industry drew the largest share of announced greenfield value in 2025. Automotive and construction investment each rose more than five-fold. Yet the report offers a note of caution for those expecting factory floors: more automotive investment does not necessarily mean deeper manufacturing integration, since many projects in supply-chain-linked industries involve retail, distribution and other downstream activities rather than manufacturing itself.

The financing picture tells a similar story of concentration. International project finance value rose 65% to $114 billion in 2025, even as the number of deals fell 16%, a shift towards fewer, larger and more digital commitments. Financing for telecommunications infrastructure more than tripled to almost $24 billion, with the $20 billion Stargate UAE artificial intelligence data-centre project accounting for much of the increase. Such cloud and AI infrastructure demands exceptionally large financing, and the surge reflects the ambitions of GCC economies, particularly Saudi Arabia and the United Arab Emirates, to position themselves as regional and global digital hubs, an ambition with consequences for the skills and technology base of their workforces.

Gulf investors, meanwhile, are increasingly part of life in other regions. Announced greenfield investment outside the GCC more than tripled, from $139 billion in 2016 to 2020 to $461 billion in 2021 to 2025, with Egypt and the United States as the leading destinations. China and India have gained importance as sources of investment flowing into the Gulf. Taken together, these trends reinforce the region’s role as a bridge linking Asian capital and production networks with markets in Africa, Europe and North America. For communities in developing economies, particularly in Africa and parts of Asia and Central Asia, Gulf capital carries real weight, especially for infrastructure and the energy transition, where financing gaps remain large.

That interdependence is precisely what the Strait of Hormuz crisis now puts at risk. Preliminary indicators for the first half of 2026 point to a sharp, region-wide weakening of investment activity. Prolonged disruption could push sovereign investors and state-linked companies to prioritize domestic resilience, infrastructure and diversification projects at home. Long-term international investment programmes nevertheless remain substantial, but delays to overseas investment could weigh on infrastructure and renewable-energy projects in developing countries, places where the stakes for ordinary residents are highest.

According to the report, stronger transport links and alternatives to vulnerable maritime routes can support resilience, while a better investment environment, deeper regional integration, and investment in skills, technology and domestic suppliers remain important to sustaining diversification. For the region’s investors and the communities that host their capital alike, the coming period will test whether the connections built over the past decade can hold.