9/11 has led to return of capital invested abroad

ABU DHABI — The 9/11 attacks have led to the return of most of the capital invested abroad to the region, benefiting the national economy to a great extent, an economic expert has said.

By Atef Hanafi

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Published: Mon 21 Nov 2005, 9:11 AM

Last updated: Thu 2 Apr 2015, 8:45 PM

"The September 11 events have led to the inflow of a major portion of capital invested abroad. These funds have been pumped into the national economies of countries in the region, including the UAE," Dr Jawad Al Anani, former Jordanian deputy prime minister, who is currently an economic expert with the International Monetary Fund (IMF), told Khaleej Times.

Dr Jawad Anani spoke at length on privatisation and the role of the government in development.

Stating that there was no clear view on the success of privatisation because of different circumstances and problems in different countries, he said: "What succeeded in Jordan failed elsewhere, for instance in Mexico and Argentina. There must be perfect planning before the process of privatisation is launched."

Concerning privatisation in the UAE, he said the idea was based on multiplier effect rather than fighting corruption, since the situation was different in the Emirates from other countries.

Dr Anani said the role of the government in the Emirates was not the outcome of ethnic thinking, but was due to the fact that the capabilities of the Emirates people in production for the past 50 years had been limited.

"The government should, in such cases, set up infrastructure and launch other services, and it is actually been done with high quality here," he said.

He pointed out that with the rapid changes the country was facing, it does not provide these services merely to its own people, but also to 2.5 million foreigners who are in need of most of these services.

He said this is what makes privatisation a reality, which is perceptible in the education sector where expatriate students shifted from government schools to private institutions, leading to mushrooming of private schools.

The same is the case with the health sector where new private hospitals have been built after treatment in government hospitals became the domain for nationals, he said.

Dr Anani said the absence of a taxation system in the UAE made privatisation a matter of sharing in community development, where everyone knows his or her role.

The talk about privatisation not needed in the UAE is wrong, he said. Though the economy is strong, the need for more services makes it necessary to come up with more alternatives, he added.

He emphasised on the need to come up with more income-generating alternatives, and not merely depend on oil revenue, like investment in different industries, which will also generate job opportunities.

"The growth in population is 7.2 per cent including 2.5 per cent among nationals," he pointed out.

On the need to have a strategic partner in privatisation operations, Dr Anani said a strategic partner is a must, in view of the requirement of advanced technology, administration and expertise.

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