How Could Foreign Direct Investment Obtain A Legal Protection in Saudi Arabia - Dissertation Example

i Arabia 51 3.1 Introduction 51 3.2 FDI Dispute Resolution 52 3.2 The Arbitrability of FDI Related Disputes in Saudi Arabia 53 3.3 Arbitration Law in Saudi Arabia 55 3.4 Conclusion 58 Chapter Four 59 Findings/Conclusion and Recommendations 59 4.1 Findings/Conclusion 59 4.2 Recommendations 62 Bibliography 64 Chapter One/History and Background of the Study I.I. Introduction According to a Gulf Cooperation Council (GCC) report, Saudi Arabia continues to lead all GCC states in FDI inflows.2 GCC FDI inflows dropped by 15 % in 2008 as a result of the recent global financial crisis although FDI declines for GCC states were not as steep as other developing economies.

3 Therefore trends prior to the global financial crisis of 2008-2009 are more instructive as it reflects a more reliable understanding of independent variables and thus are not impacted by the global financial crisis that impacts all other economies. A report by the United Nations’ organization, the Economic and Social Commission for Western Asia (ESCWA) in 2008 is therefore more instructive. According to ESCWA FDI inflows in ESCWA states began an “upward trend” in 2002 with total inflows reaching a “new record of US$55.

6 billion in 2006 an increase over US$10.8 billion three years earlier in 2003.4 The major FDI recipients among ESCWA states are Egypt, Saudi Arabia and the United Arab Emirates (UAE). Each of these countries made a variety of reforms and made significant investments in infrastructure and by 2006 they attracted 74 percent of all FDI inflows among ESCWA states.5 According to the United Nations Conference on Trade and Development (UNCTAD) Saudi Arabia is the world’s tenth largest recipient of FDI inflows attracting US$48 billion dollars in FDI inflows in 2008 and US$36 billion in 2009.6. According to a Gulf Cooperation Council (GCC) report, Saudi Arabia continues to lead all GCC states in FDI inflows.

GCC FDI inflows dropped by 15 % in 2008 as a result of the recent global financial crisis although FDI declines for GCC states were not as steep as other developing economies. Therefore trends prior to the global financial crisis of 2008-2009 are more instructive as it reflects a more reliable understanding of independent variables and thus are not impacted by the global financial crisis that impacts all other economies. A report by the United Nations’ organization, the Economic and Social Commission for Western Asia (ESCWA) in 2008 is therefore more instructive.

According to ESCWA FDI inflows in ESCWA states began an “upward trend” in 2002 with total inflows reaching a “new record of US$55.6 billion in 2006 an increase over US$10.8 billion three years earlier in 2003. The major FDI recipients among ESCWA states are Egypt, Saudi Arabia and the United Arab Emirates (UAE). Each of these countries made a variety of reforms and made significant investments in infrastructure and by 2006 they attracted 74 percent of all FDI inflows among ESCWA states.

According to the United Nations Conference on Trade and Development (UNCTAD) Saudi Arabia is the world’s tenth largest recipient of FDI inflows attracting US$48 billion dollars in FDI inflows in 2008 and US$36 billion in 2009. Since the middle of the 1980s a number of countries in the Middle East and North Africa have made a number of reforms aimed at “improving the fundamental determinants of return on investments”.