London: Investment in the UK from the Gulf is expected to be stable this year amid falling oil prices, according to a government official.
Global benchmark Brent crude has dropped by 50 per cent to around $50 (Dh183.50) a barrel since June 2014. But it reached a 2015 high on Tuesday to $63 a barrel.
“I expect to see a reasonably consistent level of engagement with the UK, certainly relative to other countries because the fundamentals of the UK are strong,” Dominic Jermey, chief executive of UK Trade and Investment (UKTI), told reporters in London on Wednesday.
In the last five years, the UK has been regarded as an economically and politically stable destination, and this has attracted investors and businesses there.
“For a Gulf investor, you are looking for a steady, predictable return. You are looking for opportunities that are going to see through the ups and downs of the economic cycle. The consistent message that I get back when I talk to Gulf investors is that for them the UK offers that steady predictability because it is well regulated; when you have a change in government, it doesn’t mean that everything then changes,” Jermey said.
According to him, the UK is more attractive to businesses in comparison to other countries in the Eurozone, which have slipped into deflation. However, inflation, as measured by the UK consumer prices index, reached a record low of 0.3 per cent in January.
“Our relative attractiveness has increased significantly and I think that will have an impact on those companies that are looking for medium-term prosperity and longer-term partners. They will find the UK a much safer environment in which to invest,” he said.
The UK is looking to attract investment from the Gulf. Retailers from the region that expand into the UK will have “access to one of Europe’s largest markets [and] the rest of Europe … access to the innovation and competitiveness of the UK market,” Jermey said.
There are three million small- and medium-sized businesses in the UK, he said.
On the impact of the three Emirati sisters who were injured after a claw hammer attack in their London hotel last year on the capital’s image as a desirable destination for trade and investment, Jermey said: “I think it made no difference at all in terms of perception in the medium term.”
