Consultative approach key to economic growth

A consultative approach between regulators and banks is important for balance between sustainable economic growth and protecting the system.

By Staff Report

  • Follow us on
  • google-news
  • whatsapp
  • telegram

Published: Tue 18 Feb 2014, 10:57 AM

Last updated: Tue 7 Apr 2015, 10:15 PM

Abdul Aziz Al Ghurair delivering key-note address at the GCC Regulator’s Summit in Dubai. — Supplied photo

This was stated by UAE Banks Federation chairman Abdul Aziz Al Ghurair during a keynote speech at the opening session of Thomson Reuters 8th Gulf Cooperation Council (GCC) Regulators’ Summit. The event is organised in collaboration with the Dubai International Financial Centre.

“Collaboration and inclusion are key elements of the consultative approach which, in my view, will protect the interest of all stakeholders. The UAE Banks Federation has seen the UAE Central Bank playing a positive role in this regard, taking a balanced approach on regulations, while encouraging growth and protecting the financial system. They have been pro-active in conducting regular dialogue with the industry to ensure that regulations not only secure the long-term health of the banking system, but also protects consumers and help the economic growth of the country,” Al Ghurair said.

“We all know that the financial services industry is the backbone of any economy. This sector not only impacts the economic growth of the country but also influences the daily lives of its people. Therefore, regulators in each country have a challenging task of enforcing regulations, which ensure that banks and financial service companies remain healthy and also contribute to the economic growth in different economic cycles,” he added.

Nadim Najjar, managing director, Middle East, Africa and Russia / CIS, said: “In 2011, Thomson Reuters polled more than two thousand senior governance professionals, compliance officers and legal counsels. The results of our survey showed that the increase in regulation over the past several years has significantly impacted the performance of compliance professionals, the companies that they work for, and the broader economy as a whole. And around 71 per cent — of those surveyed said that the global economy is now being negatively impacted by the burden of excessive regulation.”

“Although we still see regulatory issues that deter foreign investment in the region, there are also limitless possibilities especially as we move to clarify our regulations. The GCC regulatory landscape has been experiencing ongoing significant change during the past few years. In response to the global financial crisis in 2008, GCC regulators have embarked on a wide-ranging reform agenda,” he added.

Najjar pointed out that the top themes in 2013 remained money laundering, risk management, terrorism finance, data security, global sanctions enforcement, and the new international core principles such as Basil III and the International Organization of Securities Commissions (IOSCO). “We have also seen development and further regulation in the field of Islamic Finance, especially in terms of Shariah standardization and compliance,” he noted.

Many speakers focused on the ongoing effort to attract institutional investors and to limit the scale and impact of speculative investing. Additionally, regulatory representatives stressed the importance of expanding co-operation and communication, not only among authorities within countries, but also between countries in the region. Panelists spoke about supporting and expanding the SME sector by facilitating freer and more robust access to capital markets, as well as more proactive help from lenders.

They highlighted some of the challenges facing the broader regional co-operation and pointed out that GCC jurisdictions are still in the process of developing and implementing new regulatory and legislative frameworks. Speakers at the first session recognised that the GCC is and can continue to be a coherent player on the global market and that greater co-operation will help both to promote and protect the region’s long-term economic interests.


More news from