While Saudi Arabia remained the largest Arab destination for FDI, attracting nearly $147.1 billion, the UAE's share stood at $73.4 billion, making it second top investment recipient in the region, according to the UNCTAD's 2010 global investment report.

The Kingdom, which lured nearly $36 billion in foreign direct investments in 2009 alone, came second in the Arab World in terms of capital exports, pumping $40.3 billion in FDI during 1990-2009, the report said.

The FDI flow out of the UAE, which cornered nearly 26 percent of the combined foreign capital received by the GCC, climbed to a record high of $15.8 billion in 2008 from $14.5 billion in 2007 before plunging to $2.7 billion in 2009 on the back of the global financial crisis and lower oil prices.

Last year, the UAE accounted for around 0.4 percent of the world's total, 1.5 percent of the FDI in developing countries and more than 10 percent of the Arab FDI inflow, said the report.

UNCTAD figures also revealed that the bulk of the UAE's FDI targeted neighboring countries, with $62.4 billion invested in the region during 1990-2009. Saudi Arabia accounted for nearly 70 percent of the UAE's investments while Egypt, Morocco, Lebanon, Libya and Tunisia were also major recipients.

Qatar, the world's biggest LNG exporter, emerged as the third largest FDI target within the GCC, attracting $28.1 billion during the past two decades. It was followed by Bahrain, with cumulative FDI of about $14.9 billion, according to UNCTAD.

While FDI flow into Oman stood at around $13.2 billion, Kuwait emerged as one of the laggards in the region, attracting only $986 million. In terms of FDI outflow, Qatar overtook Kuwait for the first time at $16.03 billion as the latter pumped only $16.01 billion during past two decades, according to the report.

Across the Arab region, Egypt attracted a cumulative FDI of about $66.7 billion, making it the largest FDI recipient and the third in the whole Arab World during 1990-2009. Morocco ranked fourth, attracting around $40.7 billion, followed by Lebanon and Tunisia, with $32.08 billion and $31.8 billion respectively, according to the report.

While conflict-battered Iraq received $5.06 billion, the occupied Palestinian territories attracted only $1.2 billion due to persistent tensions and Israeli restrictions.

The UNCTAD report showed that FDI flow into the GCC witnessed a drop of 16.67 percent to $50 billion in 2009 over a year earlier due to the global fiscal crisis that started in 2008.

The FDI flow into the UAE, a major victim of the global economic downturn, fell from $13.7 billion in 2008 to nearly $4 billion in 2009, one of its lowest levels over the past 15 years, according to the UNCTAD report.

Last year, FDI flow into Saudi Arabia slumped from a record high of around $38.1 billion in 2008 to about $36 billion. The only exception was Qatar where FDI inflow more than doubled from $4.1 billion in 2008 to $8.7 billion in 2009.