While the Middle East turns into a more appealing location for FDI, understanding the investment dangers is increasingly important.

Pioneering studies on dangers linked to international direct investments in the MENA region offer fresh insights, attempting to bridge the gap in empirical knowledge concerning the risk perceptions and administration strategies of Western multinational corporations active widely in the region. For instance, research project involving several major worldwide businesses in the GCC countries unveiled some interesting findings. It suggested that the risks related to foreign investments are a great deal more complex than simply political or exchange rate risks. Cultural risks are perceived as more essential than political, economic, or financial risks based on survey data . Additionally, the study discovered that while elements of Arab culture strongly influence the business environment, many foreign businesses find it difficult to adapt to regional traditions and routines. This difficulty in adapting constitutes a danger dimension that will require further investigation and a change in just how multinational corporations run in the region.

Working on adjusting to regional traditions is necessary however enough for successful integration. Integration is a loosely defined concept involving a lot of things, such as for example appreciating regional values, understanding decision-making styles beyond a limited transactional business viewpoint, and looking at societal norms that influence business practices. In GCC countries, successful business connections are far more than just transactional interactions. What influences employee motivation and job satisfaction vary significantly across countries. Hence, to truly integrate your business in the Middle East a couple of things are essential. Firstly, a business mindset shift in risk management beyond economic risk management tools, as specialists and solicitors such as Salem Al Kait and Ammar Haykal in Ras Al Khaimah may likely recommend. Next, methods which can be effectively implemented on the ground to translate the new strategy into practice.

Although political uncertainty appears to take over news coverage regarding the Middle East, in recent years, the region—and specially the Arabian Gulf—has seen a stable upsurge in international direct investment (FDI). The Middle East and Arab Gulf markets have become increasingly attractive for FDI. Nevertheless, the present research on what multinational corporations perceive area specific risks is scarce and frequently does not have insights, an undeniable fact solicitors and danger specialists like Louise Flanagan in Ras Al Khaimah would probably be aware of. Studies on dangers associated with FDI in the region tend to overstate and predominantly focus on political risks, such as for instance government instability or policy changes that could affect investments. But recent research has started to illuminate a critical yet often overlooked aspect, particularly the consequences of social facets in the sustainability of foreign investments in the Arab Gulf. Indeed, a number of studies expose that lots of companies and their management teams notably overlook the effect of cultural differences, due primarily to too little understanding of these social variables.