Region offers sea of opportunities for sustaining GDP growth

Dubai: If there are challenges in the face of global financial turmoil, opportunities also exist, Emaar Properties chairman and co-chair of the Summit on the Global Agenda, Mohammad Ali Al Abbar said at the opening of the inaugural World Economic Forum in Dubai on Friday.

"Recently so much of our attention has been focused on the looming financial crisis," Al Abbar said. "In the process we have perhaps overlooked the opportunities that we already have within our reach."

He pointed to the one-trillion dollar Gulf economy as an example of "compelling economic bloc."

"Despite the challenges of softening oil prices and higher financing costs, the region will support sustained GDP growth. On the demographic side, some 65 per cent of our population is under the age of 25, that is about 200 million people. They are our strongest asset and the source of growing domestic demand."

Diversification

And not just restricting to the Gulf only, he expects the wider region, stretching across Middle East, North Africa and South Asia, to experience steady economic growth.

This region, home to one-quarter of the world's population is estimated to grow at an annual average of six to seven per cent and cumulative investments are expected to exceed $15 trillion the next 10 years, Al Abbar said.

"The BRIC economies of Brazil, Russia, India and China will also continue their growth curve, despite some temporary dips. These economies will fuel global growth," he said.

Crediting the timely intervention of the UAE government in averting any crisis, Al Abbar added that the UAE, like other Gulf economies, has demonstrated "smart resilience" to the global financial crisis.

The reason for the relatively lesser impact of the oil prices softening on the country has to large extent been due to the economic diversification model it has pursued, he said.

Roadmap

With a focus on non-oil sectors such as tourism, education and information technology, it can serve as a "roadmap" for other emerging economies, which are now adjusting to the new global realities.

He views that the UAE has a stake in working together with various nations in solving the crisis.

The most evident example of the country becoming coupled with the US and other parts of the globe has been the stock market which has had a precipitous decline with the fight of foreign institutional investors, who have exited emerging economies to cover their positions back home.

And in the property sector, investors have come in from various parts of the world, leading to a boom in the past few years.

Financial services is another sector which have witnessed increasing influx of international players, including global investment banks and private equity and hedge funds.

"Today, we have already confidently moved into this economic reality. The UAE is integrated fully into the global economy and it is in our interest to fully participate in the global revival of the financial sector and focus on shared growth," Al Abbar said.