UAE, a promising investment destination

Shurooq is all set to promote investment opportunities at 12th edition of World Forum for FDI, writes Muzaffar Rizvi

The investment outlook in the UAE appears to be very promising as the emirate offers excellent infrastructure, political and economic stability, a tax free environment and an ideal geographical location, according to top official of Shurooq.

Marwan Al Sarkal, chief executive officer of Sharjah Investment and Development Authority (Shurooq), the UAE in general and Sharjah in particular offer what can arguably be considered one of the best platforms for foreign direct investment.

“The UAE’s economic growth is very robust despite fall oil prices decline in international markets. The government forecasts 4.5 per cent gross domestic product growth in 2015,” Al Sarkal told Khaleej Times in an exclusive interview ahead of 12th World Forum for Foreign Direct Investment being held in the region for the first time.

Sharjah will host the three-day event, which is scheduled to start today. It will be attended by CEOs and senior executives from local and international organisations, investment promotion agencies and economic development organisations. In previous years, the forum has taken place in the world’s foremost business hubs: London, Shanghai, Amsterdam, Brussels, Philadelphia and Valencia, among others.

The Shurooq chief executive said the ease of doing business is among the highest in the region and continues to improve rapidly. The real estate sector is enjoying a boom based on strong and sustainable foundations.

“The UAE is welcoming leading global events to its shores, from the imminent 2015 World Forum for Foreign Direct Investment in Sharjah, to the World Expo 2020 in Dubai. Upon stable political and economic foundations, investors are seeing abundant opportunities across the UAE in a multitude of sectors,” he said.

About the outlook in other Gulf countries, he said it varies from country to country, depending on factors such as the level of political volatility and economic dependence on oil revenues. Overall, however, the Gulf region presents outstanding investment opportunities, especially because some other regions of the world are experiencing subdued economic growth. 

Promising outlook

Referring to data from the United Nations, he said the Middle East as a whole saw $44 billion FDI inflows into the region in 2013 while the UAE attracted more than $10 billion investment during the year – a substantial rise over the corresponding year. The cumulative FDI in the UAE stood at $60.76 billion from 2006 to 2013 and the similar steady trend also continued last year.

“We are confident that this forum will help boost that volume, by exploring the big questions that face investors today and helping find the solutions to overcome barriers to FDI in the region,” he said.

Elaborating the forum’s programme, he said the three-day event will discuss the role of diplomacy and geopolitics in FDI, alternative cross-border financing options to transitional financing, how to navigate bureaucracy, and the development of top talent. In each of these areas there is plenty that Sharjah, the UAE, and the region can offer the rest of the world.

“The theme of this year’s forum is ‘Where East Meets West’.  A key topic that will be discussed is the challenge of bridging cultural differences in business practices.  We’ll look at which companies have got this right in the past and learn from what mistakes they’ve made along the way.

“How can these differences cause conflict in the multinational workplace and how can they be overcome? It’s a challenge, for sure, but by no means an insurmountable one. The way to resolve it is by dialogue – as we’re doing at this forum – to understand how and why each side approaches business in the way it does.” 

Transparent communication

Sharjah Ruler set to open forum today Sharjah — The 2015 World Forum for Foreign Direct Investment (FDI), organised by the Sharjah Investment and Development Authority (Shurooq), kicks off  today at the Al Jawaher Reception & Convention Centre in Sharjah. His Highess Shaikh Dr Sultan bin Muhammad Al Qasimi, Member of the Supreme Council and Ruler of Sharjah; Sultan bin Saeed Al Mansouri, UAE Minister of Economy; and Shaikha Bodour bint Sultan Al Qasimi, Chairperson of Shurooq, as well as top officials from local and international investment agencies and organisations will attend the three-day event. Dr Sultan bin Muhammad Al Qasimi will deliver the opening address of the forum, followed by Sultan bin Saeed Al Mansouri, and Shaikha Bodour Al Qasimi, after which Sir Tim Berners-Lee, inventor of the World Wide Web, will present the opening session, ‘Leapfrogging competition: Tech strategy for business’. In addition to Sir Berners-Lee, the forum will present keynote addresses by Gurcharan Das, former chief executive, Procter & Gamble India, who will be exploring the topic ‘India versus China — Who will win the race?’ and Ms Robin Chase, founder and former chief executive of Zipcar and Buzzcar, who will expound on ‘Building an international business’. Delegates, visitors, and speakers will also be taken on a tour of the Saif-Zone — the Sharjah Airport International Free Zone. — business@khaleejtimes.com

Al Sarkal said there are also the risks that can affect any region, such as political, security and macroeconomic risk, which are affecting investment prospects in some parts of the region – but these are not prevalent in the UAE.

“Other than that, it is about showing foreign investors that we have the infrastructure, business climate, regulatory clarity and incentives in place to be a highly attractive FDI destination. One of the crucial factors is clear and transparent communication with prospective foreign investors at all times, ensuring they are aware of precisely what to expect when they make an investment,” he said.

To a question about possible FDI inflows into the region, he said it is very difficult to put a precise figure on how much investment should come to the Gulf.

“What I can assert with confidence is that the region’s potential for FDI is enormous, with the scope to grow well beyond volumes as they are today.

“I can say that with confidence because the region overall is seeing robust economic growth — both in total and in terms of rising incomes per person — increasingly free and liberal business environments, workforces enjoying better education and improved healthcare, more effective regulation, and so on,” he said, adding that this isn’t just restricted to one or two sectors — it’s across the entire economy.

“We’re seeing exceptional advances in every industry from construction and manufacturing to energy, financial services, and research and development in high tech industries. However, at this point in time the Gulf countries do not yet receive their fair share of FDI’s when compared to other regions around the world.

“As I mentioned before, we have the perfect platform and we must work on attracting a larger share of FDI’s to our region. The Gulf region welcomes all kinds of foreign investment – ultimately to foster mutually beneficial relationships,” Al Sarkal concluded.

— muzaffarrizvi@khaleejtimes.com