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Dubai ranked fifth financial centre outside US, Europe

DUBAI - Dubai is boosting the emergence of the Gulf Cooperation Council (GCC) region as a centre of activity in the global financial industry, according to a study undertaken by UK-based global research organisation Chatham House.

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The study titled 'The Gulf as a Global Financial Centre: Growing Opportunities and International Influence' examines the prospects for the economies of the Gulf Cooperation Council (GCC) countries and the potential development of the region as a Global Financial Centre.

The study pointed to Dubai's high ranking in the City of London's Global Financial Centres Index (GFCI) for March 2008. The Index ranked Dubai 24th, ahead of cities like Shanghai, Stockholm, Brussels, Mumbai and Madrid. The Chatham House report highlighted the fact that, outside Europe and North America, Dubai was ranked fifth in the world in the London survey.

Dubai was also cited by the survey as being the number one among financial centres to "become significantly more important over the next two to three years." As a destination where businesses are thinking of opening in the next few years, Dubai was ranked number one. Bahrain was ranked 39th while Qatar was ranked 47th in the overall GFCI Index.

Extrapolating from the GFCI report and its own estimates for economic and financial sector growth, Chatham House said the GCC could overtake both Australia and Tokyo in the rankings over the next decade. The GCC economy has approximately tripled in size in just five years and the combined GDP will be well above $1 trillion in 2008, while the states' external financial wealth in the form of sovereign wealth funds (SWFs) and foreign exchange reserves alone is more than double this figure, the study said.

The GCC 'brand', which has been very successful in promoting the visibility and image of the region, should be actively pursued to further enhance market power and credibility, the Chatham House study suggested.

"Economic growth and wealth creation," it said, "will continue to provide the big punch behind the 'brand'."

The study further talked about the need for GCC countries to "aggressively" correct the tendency for observers to view the region as a 'developing economy'.

The GCC's average GDP per capita is now almost on a par with many developed economies while its non-energy GDP per capita is well above emerging-market levels, it noted.

mark_townsend@khaleejtimes.com