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UAE Leads GCC In Foreign Investment As Inflows Hit $60 Billion

Foreign inflows into GCC equity markets surged in February 2025, with a net inflow of $2.47 billion, marking a significant jump from $939 million in January. The UAE led the way with $2.47 billion in inflows, followed by Saudi Arabia with $352 million and Kuwait with $304 million. However, Qatar saw outflows of $212 million, while Oman experienced a more significant outflow of $446 million.

Year-on-year, foreign inflows have more than doubled from $890 million in February, reflecting a broader trend of growth. Cumulative foreign inflows across the region have now surpassed $60 billion, a significant rise from $50 billion in August 2024 and $30 billion in March 2022.

This momentum can be attributed to several factors, including index inclusions, strong corporate earnings growth, and global emerging market funds directing more capital toward GCC markets.

Investor Confidence Boosted By Strong Inflows

Saudi Arabia remains the leader in foreign inflows, accumulating $34 billion, followed by the UAE at $20 billion. Kuwait has attracted $4.7 billion, while Qatar has faced more erratic flows, accumulating $3.1 billion. The increase in foreign investment highlights rising confidence in GCC markets.

Implications For Public Companies

The February data points to a shift in investor preferences, with capital flowing back into the UAE while Saudi Arabia continues to see steady inflows. Public companies in strong-performing markets are encouraged to leverage this momentum by providing clear updates on business strategies and future growth plans. For countries like Oman and Qatar, which have experienced outflows, addressing concerns about liquidity, earnings visibility, or macroeconomic risks will be key.

Proactive engagement with foreign investors will be crucial to securing stable and long-term foreign capital as allocations become more dynamic.

Abu Dhabi And Dubai Show Strong Performance

Among the emirates, Abu Dhabi and Dubai have experienced notable foreign inflows. In February, Abu Dhabi saw net inflows of $2.26 billion, while Dubai recorded $208 million. Over the long term, Abu Dhabi has accumulated $15.9 billion in net inflows, and Dubai has attracted $4.2 billion in foreign investment.

Shein Targets $25 Billion Valuation In Hong Kong IPO As Growth Slows

Shein is reportedly targeting a valuation of around $25 billion in its planned Hong Kong IPO, a sharp decline from the nearly $100 billion valuation the online fashion retailer achieved in a 2022 fundraising round.

Two people familiar with the plans said the company was likely to target about $25 billion, while another source put the expected range at $25 billion to $28 billion based on the proposed price band.

IPO Valuation Falls Sharply

Shein plans to sell up to 8% of its shares in the offering, according to a person familiar with the plans. At a $25 billion valuation, that would translate into an IPO of as much as $2 billion.

The latest target is also below the $30 billion to $40 billion valuation the company was seeking earlier this month as it began meeting with potential investors.

Founded in China in 2012 and now headquartered in Singapore, Shein sells low-cost clothing to consumers in about 160 countries. The company is expected to launch its long-awaited Hong Kong IPO later this week.

Trade Restrictions Weigh On Growth

Shein’s valuation has come under pressure as major markets tighten rules affecting low-cost e-commerce shipments. The European Union, for example, has moved to impose additional fees on cheap parcels from platforms such as Shein and Temu. EU Tightens Rules On Low-Cost E-Commerce Parcels

In the U.S., the removal of an import duty exemption for small packages has also affected the company. Shein reported a $99 million quarterly loss in the first quarter of 2026 as sales growth slowed, while a one-time accounting charge further weighed on its results. Shein Reports First-Quarter Loss Ahead Of IPO

Investors Question Shein’s Growth Prospects

The steep reduction in valuation reflects growing concerns over slower growth, higher trade costs, regulatory pressure and stronger competition across global e-commerce.

Some investors who reviewed Shein’s recent financial statements or attended IPO presentations told Reuters they were skeptical that the company could return to the growth rates that supported its $98.2 billion valuation in 2022. Shein’s Slowing Growth Tests Investor Appetite

A lower IPO valuation could also affect Shein’s existing investors. Under the terms of its IPO filing, the company may have to issue additional shares to certain pre-IPO investors if its valuation falls below agreed thresholds.

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