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Dubai’s economic success model for China, Arab world

Improved information sharing to underpin greater bilateral ties.

Zhou Wenzhong, secretary-general of Boao Forum for Asia,speaking at the Boao Forum for Asia Financial Cooperation Conference in Dubai on Monday. — Wam

Dubai’s economic success is a model for China and the wider Arab world, said top industry experts at the Boao Forum for Asia Financial Cooperation Conference on Monday in Dubai.

During a panel discussion titled: ‘Role of Dubai in Cross-Regional Financial Cooperation in Asia Pacific Market: Current Status, Potentials and Opportunities’ they also said that improved information sharing between the UAE and China would serve to underpin greater bilateral investment and financial cooperation.

Abdullah Mohammed Al Awar, CEO of the Dubai Islamic Economy Development Centre, opened with noting the size of the rapidly growing Islamic economy, and particularly the growth of Shariah-compliant financial instruments. He told delegates that global Islamic banking assets stood at close to $2 trillion at the end of 2014, and are expected to exceed $1 billion by 2015. He said Islamic asset-backed financial instruments, such as sukuk, could be ideal tools for facilitating the planned $8 trillion-worth of infrastructure projects planned in Asian economies, and the $800 billion worth of projects planned in the GCC.

Talking the potential opportunities, Al Awar said: “I think one is in infrastructure projects. The fact that sukuk and other Islamic finance instruments have an asset-backed nature, but also the concept of business risk sharing, could be appealing to investors looking for a longer-term tenure and the sort of stable, predictable cash flow that sukuk offers,” he said. “This is one of the opportunities that could be tapped into between both regions.”

Joining the panel discussion, Jia Kang, president, China Institute of Supply Economics; Research Fellow, Research Institute of Fiscal Science, Ministry of Finance of China, elaborated on the ties between China and the UAE, and specifically the role Islamic finance could play in deepening this relationship.

Kang noted that China, like Dubai, has seen rapid, double-digit economic growth in recent years and emphasised the importance of the new Silk Road to the future of both economies. He said the emirate’s success in financing infrastructure projects and in utilising innovative Public-Private-Partnership (PPP) models offered valuable lessons to China and the wider Arab world. Chirag Shah, chief strategy and business development office at the Dubai International Financial Centre Authority, talked about Dubai’s role as a gateway to business opportunities in Asia and Africa.

Shah said the DIFC served as a microcosm for the global financial architecture, noted that, at its launch 10 years ago, 80 per cent of firms in the financial free zone hailed from Western Europe and North America.

Today, more than 40 per cent of companies come from the Middle East and Asia.

“Firms from the Middle East and Asia are now ready to take on a global role. Where there is trade, finance is likely to flow and will follow. It would be incorrect for anyone to ignore the growing economies of the Middle East, Africa and South Asia,” he added.

— abdulbasit@khaleejtimes.com