The GCC received a trifling $24 billion of the more than $1 trillion in global green foreign direct investment (FDI) that flowed between 2020 and 2024, even as these countries invested $132 billion in green projects abroad.

Between 2020 and 2024, Saudi Arabia, the UAE, and Oman together represented the bulk of large-scale activity in the GCC, accounting for 29 outbound and 10 inbound green FDI deals.

An analysis by Strategy& said the region has a compelling opportunity to emerge as a major destination for climate-aligned FDI.

The region possesses notable competitive advantages, including the lowest production cost for solar energy in the world, with 6 of the 10 lowest-cost solar projects globally being based in the GCC.

Between 2020 and 2024, 53 per cent of all large-scale global FDI went into green sectors. Hydrogen and ammonia, renewable power, and batteries alone accounted for 80 per cent of this green investment.

Most outbound investments from the GCC targeted hydrogen and ammonia projects in Egypt and Mauritania, while inbound deals largely emerged from China, India, and the US, targeting investments in hydrogen and electric vehicles.

Saudi Arabia received the lion’s share of investments at $12.6 billion. This was closely followed by Oman with $8.9 billion, including two major Indian-backed projects in green ammonia and green steel.

Strategy&’s report outlines four strategic recommendations, including landmark policy moves, investment de-risking, green industrial development, and strategic outbound investment.