The GCC equity markets witnessed a notable decline in foreign investor inflows, recording $939 million in January 2025, a new report suggests. According to investor relations consulting firm Iridium Advisors, this figure represents a decrease from $1.04 billion in December 2024 and $1.42 billion in November 2024.
Saudi Arabia led the way with net inflows of $694 million, followed by Kuwait at $133 million and the UAE at $115 million. Qatar maintained a nearly neutral position, with inflows of $8 million, reversing its $43 million outflow from December. Although inflows remain positive, the recent slowdown indicates that foreign investors are becoming more selective in their allocations.
Saudi Arabia remains at the forefront of the region regarding cumulative foreign inflows, amassing $33.49 billion as of January 2025—nearly double the UAE’s total of $17.61 billion. The UAE, having been the top recipient of inflows in 2024, has witnessed a deceleration in momentum, suggesting that investors are reassessing valuations following last year’s robust market performance. Meanwhile, Kuwait has shown steady growth with a cumulative inflow of $4.41 billion, while Qatar stands as the least attractive market for foreign capital, with inconsistent flows totaling $3.31 billion over the past year.
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Evolving market conditions and engagement
The foreign flow data from January suggests that while foreign investors remain engaged in the GCC, their approach has become more measured. Saudi Arabia’s dominance in cumulative inflows highlights long-term investor confidence in its market. The UAE’s recent slowdown indicates that investors are becoming increasingly sensitive to valuations, as per Iridium Advisors. To maintain foreign interest, the firm advised companies to prioritize clear communication regarding their growth strategies, capital allocation, and financial performance. As market conditions evolve, investor relations teams should proactively articulate their value proposition and actively engage with foreign investors, the report concluded.
