Bullish outlook for FDI sector in UAE
Many key factors of strong economy in place
Shaikha Bodour bint Sultan Al Qasimi and Barry Johnson on the final day of the 2015 World Forum for Foreign Direct Investment in Sharjah on Tuesday. — Supplied photo
Sharjah — The UAE’s foreign direct investments industry is very bullish and positive coupled with right economic policies that are vital for a vibrant FDI attraction. Many of the key determinants of a strong FDI economy are in place here, a top official of the Global FDI Association said on Tuesday at the concluding day of 2015 World Forum for Foreign Direct Investment, organised by the Sharjah Investment and Development Authority, or Shurooq, under the theme “Where East meets West”.
“The first thing you have is enthusiasm and commitment at the senior levels of the UAE government. The UAE in many regards conforms to best practices; FDI is coming to this country not because they have an economic story to tell; they also have a good living story to tell because at the end of the day, people want to come where their businesses can do well and where they can also live and exist in an environment that is dynamic and inspires you. And its clear that all of this is offered in UAE and in Sharjah,” Barry Johnson, chairman of the board of the Global FDI Association told Khaleej Times.
What makes the uae business sector tick?
> The UAE in many regards conforms to best practices
> FDI is coming to the country not because it has an economic story to tell; it also has a good living story to tell
> The UAE’s economy is expected to grow four to five per cent, which is always a good sign because investment wants to go into growth economies where money is being spent and where there is economic vibrancy
“There are some headwinds that are related to geopolitical and sort of to the economic growth that are related to a number of things globally that are interrelated. But at the same time you have the UAE’s economy here that is expected to grow four to five per cent, which is always a good sign because investment wants to go into growth economies where money is being spent and where there is economic vibrancy.”
The total global FDI stock is more than $25 trillion, as estimated by the Unctad, and it sees an eight per cent decrease in total global FDI inflow to $1.26 trillion in 2014, impacted in large parts by the $130 billion buyback of shares by Verizon from Vodafone.
Johnson, however, does not expect a return to the $1.9 trillion mark witnessed in 2007, with forecasts of very modest FDI increases as a result of slow economic growth, volatility in currency and commodity markets, and elevated geopolitical risks in developed and developing countries.
“But there are some positive highlights; the strengthening of economic growth in the US, the demand-boosting effect of lower oil prices, proactive monetary policy in the eurozone, coupled with increased liberalisation and promotion measures,” he explained.
Johnson added: “Notwithstanding the global challenges, there are some advantages that UAE certainly enjoys. The country has witnessed rise in the number of tourists and visitors coming because clearly this is the busiest passenger airport in the world and guess what, before investment comes tourism, people visit before they invest. You have the ability to get people here. You have a leg up in terms of getting people to want to invest.”
The Global FDI Association is the first and only association in the world exclusively for professionals driving FDI. It is a global association focused on helping governments to create business environments and provide optimal conditions for foreign investors. The association’s mission is to create a clear FDI dialogue between government and industry, raise the profile of an activity that makes a quiet but significant contribution to the global economy and providing an unmatched forum for debate, deal-making and professional education.
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