Surging International Trade and Investment Reported in the UAE
In spite of slowdowns in economies across the globe, foreign trade has increased by 23 percent in the UAE, hitting Dh923bn last year.
This figure is around four times the global average and was reported by an MoFT official in Dubai, speaking at the “Seminar on Trade Facilitation” covering Arab nations and including a focus on regional integration with regards to a Multilateral Trade System. Both the Islamic Development Bank and the GCC’s secretariat were involved in the seminar.
Twelve Arab nations sent representatives, as well as several international organizations, and discussions covered various proposals and working papers designed to ease trade channels and exchange mechanisms.
Assistant undersecretary for FTA (or Foreign Trade Affairs) at the Ministry of Foreign Trade, Juma Al Kait, noted that the UAE’s ratings have improved in worldwide trade, flows of investment and business set ups. Al Kait stated that these improvements resulted from the emirates’ adopted policies.
Al Kait also noted that insufficient administration and disorganization in trade activities remain as trade impediments. He gave several examples, including complications in customs regulations, requirements for transportation, quality assurance and standardization, as well as hidden requirements that do not serve the stated purpose, which is maintaining public and consumer safety.
National markets have changed with more global integration and more businesses are establishing headquarters in places that facilitate operations, such as higher production input, greater export channels and more freedoms, allowing the firm to offer timely service to their clients, according to Al Jait.
He stated that the movement of goods remains paramount in investment decisions, and reminded listeners that barriers at the border and in administration are important factors. He related the ease of transit and trade within a nation, particularly developing countries, has an effect on the economic development, plans and opportunities within that nation. He credited the surging trade to major economic developments in the UAE, driving the nation to the top among regional and global trade hubs.
Abu Dhabi Noted as the Most Productive Economy
Out of 27 so-called “cities of opportunity,” Abu Dhabi nabbed top spot for most productive economy, according to a recent report from PricewaterhouseCoopers and the Partnership for NYC.
The capital of the UAE ranked above leading cities, such as New York and San Francisco, L.A. and Chicago in terms of productivity.
The PwC report entitled “Cities of Opportunities 2012″ took a close look at the performance of urban centres known to be involved in finance, culture and commerce. Each city’s future was also rated and forecasted up to 2025. Several criteria were used to rank cities, and Abu Dhabi was found among the top cities in terms of hospitals per capita.
Future employment rates from now until 2025 were factored into the study, and included sectors like transportation, education, communications, manufacturing and hospitality.
PwC noted that Abu Dhabi has moved into a select group of cities worldwide, with the study findings indicating that the majority of employment will be centred in culture and leisure, hitting 20.3 percent by 2025. PwC also expects Abu Dhabi’s overall business services to expand by almost nine percent. The UAE has always had a positive climate for growth, according to PwC, but Abu Dhabi claimed special attention as a “City of Opportunity” due the capital’s status as a cultural, commercial and financial centre with continued growth and development, according to senior partner at PwC Abu Dhabi, Jacques Fakhoury.
PwC noted that Abu Dhabi workers add significant value to the nation’s economy, as reflected in the productivity ranking. Besides having the largest number of hospitals per capita, the capital also ranked highly among emerging economies in terms of security, health and safety, tying for first place with Tokyo.
QNB Group Reports Stronger Growth Prospects in MENA Region
Forecasts for the global economy remain bleak as major economic centres battle lower levels of growth in real GDP. On the other hand, the economic outlook for the MENA region has grown stronger with increasing oil prices and higher levels of government spending, based on a review by the QNB Group. This report of the October World Economic Outlook by the IMF was released at the annual IMF meeting in Tokyo.
Revisions have resulted in lower real GDP growth globally, marked down to 3.3 percent this year and 3.6 percent next year. Due to weaker than expected recovery in 35 different advanced economies, the outlook for global growth has fallen. Since these nations make up 51.1 percent of total worldwide GDP, the weaker numbers have created a drag on the overall global economy.
Cuts have been made in GDP growth forecasts for those advanced economies, with expectations dropping from 2.0 percent to 1.5 percent next year. According to PwC, the reduction of deficits through fiscal policy implementation is the main reason for smaller growth forecasts. IMF warnings indicate that long term growth stability could be impacted by austere fiscal policies. Weak levels of loan growth resulting from risk aversion could also impact growth.
Growth in the US has been reduced to 2.1 percent for next year, due to domestic and external risk factors. The ripple effect of Eurozone debt presents external risks for the largest economy in the world, and fiscal contraction, budget cuts and the conclusion of tax holidays in the opening months of 2013 present domestic risk factors. The deteriorating US economy has impacted confidence and increased risk aversion around the globe.
Developing Asian economies present a global growth engine. This area of the world represents 25 percent of worldwide GDP. Growth forecasts for the developing portion of Asia dropped by 0.3 percent, due to lower levels of external demand and concerning levels of domestic demand in China, reaching 7.2 percent for next year.
The MENA region’s growth prospects have expanded, with 5.3 percent growth forecasted for this year and 3.6 percent next year. A clear distinction exists in the MENA region, between oil exporting nations and importing nations, and this gap has widened. Growth prospects for oil exporters have increased from 4.8 percent forecasted in April of this year to 6.6 percent, while prospects for importing nations have dropped from 2.2 percent in April’s forecasts to 1.2 percent for the year.Paul Holdsworth, Staff Writer, Gulf Jobs Market News