Case Study: Vision2033 Ltd. and Greenfield FDI in Dubai
Vision2033 Ltd., a Canadian-based consumer goods company, is planning a major international expansion as part of its global growth strategy. The company specializes in sustainable and innovative products that appeal to environmentally conscious consumers. Vision2033’s leadership team has identified Dubai as a potential location to establish its first overseas production facility, leveraging the city’s top global ranking for greenfield Foreign Direct Investment (FDI) and its status as a hub for consumer goods
In 2023, Dubai attracted 1,070 greenfield FDI projects—more than double those in Singapore (442) and London (431). Total FDI capital inflows into the emirate reached AED 39.26 billion ($10.69 billion), with consumer goods, energy, e-commerce, and tourism ranking as top sectors. Dubai’s government aims to attract AED 650 billion ($176.97 billion) in FDI by 2033 as part of its vision to double the economy’s size.
However, Vision2033’s management is concerned about labour market challenges in Dubai. The city’s competitive business environment has led to a high demand for skilled workers, particularly in advanced manufacturing. Additionally, integrating employees from diverse cultural backgrounds presents challenges in maintaining workplace harmony and productivity.
Vision2033 is also evaluating the financial risks involved in this greenfield investment, such as the large upfront capital required to construct and operate its facility, the potential for fluctuating demand in the consumer goods sector, and the need to balance sustainability with cost-efficiency.
The company views Dubai’s advanced infrastructure, government support for FDI, and global connectivity as significant opportunities but remains cautious about the risks of entering such a competitive and culturally diverse market.
Questions
2 Mark Question:
Define greenfield Foreign Direct Investment (FDI).
4 Mark Question:
Give one advantage and one disadvantage of Foreign Direct Investment (FDI) to a country like Dubai.
10 Mark Question:
Evaluate the opportunities and risks for Vision2033 Ltd. in establishing a greenfield FDI project in Dubai.
Source: Dubai beats Singapore, London as top city for ‘greenfield’ FDI projects – Al-Monitor: The Middle Eastʼs leading independent news source since 2012 05/05/2024
This is used solely for the purpose of this exam question.
Case study, questions and copany name created by L7 Tutors ltd.