Mena firms told to project brands better globally

Mishal Kanoo and Badr Jafar discussing the challenges faced by local businesses in attracting FDI at the World Forum for Foreign Direct Investment in Sharjah. — Supplied photos

Sharjah — Local businesses in the UAE have called upon major companies in the Middle East to project their brands better abroad as they have the potential, capability and ability to compete.

The statement was made by representatives of local businesses at a session titled ‘East Meeting West: Geopolitics and Foreign Direct Investment’ at the World Forum for Foreign Direct Investment currently running in Sharjah. The three-day event will conclude today.

Badr Jafar, chief executive officer of Crescent Enterprises, said businesses have the potential and for a region with 400 million people, they have a lot to offer.

“This is the best way of projecting cultural growth. The region is so largely accessible in news but so under-projected in brands. I think some companies do not project their brands abroad because they lack confidence,” he said. Jafar also stressed that the UAE has set an example for the region and has worked on many development projects over a span of 30 years that have gained it international reputation. 

Global challenges

Meanwhile, local and international businesses in the UAE have pointed out a number of global challenges facing FDI, including overnight policy changes, cultural disconnect, ineffective legislation, ornamental corporate governance and corruption.

“The biggest challenge concerns legislation. Judges attempt to make rulings on what they deem to be important, yet are themselves not aware of the full picture,” said Mishal Kanoo, deputy chairman, Kanoo Group.

“Enforcement and respect of contracts are major issues. Corporate governance should not be implemented ornamentally. Some companies were asked to leave their host countries due to politics and this is a worry. In this case, a business has to look short-term to protect its operations,” said Jafar.

Suparna Singh, head of minerals and vice-president corporate planning, Essar, expressed concerns about investments in some African and developing countries where overnight changes in policies occur due to political conditions.

Mode of operations in some companies and trade sanctions worried Moosa Al Moosa, president UAE and finance director Middle East and Africa, Dow Chemical Company; while cultural disconnect was an issue for Badlisyah Abdul Ghani, CEO, CIMB Islamic Bank Berhad.

Local and international firms’ senior executives stressed on the importance of local partnerships, government and public affairs, and understanding of local cultural sensitivities to attract FDI.

“You do not eat your pie, you always share your pie. Partnerships are important and the local people in their own host country are an invaluable resource as they know what best works within their locality. Partnerships grow both parties and increase opportunities,” said Kanoo.

He also advised FDIs to research their partners before setting up business. “I have seen the nature of partnerships changing. The use of a local name is not enough reason to share equity. FDIs must make sure the partner is sustainable and adds value. This happens more now in the GCC states who are protective about doing business locally. Offshore and free zone operations are available which cater to the interests of FDIs and UAE firms expanding globally,” said Jafar.

— sandhya@khaleejtimes.com