Sustainable trade is the way forward

The best way to tackle the fallout of international financial crisis is to bolster business and consumer confidence and get people to invest, trade and rebuild the world economy. But the global financial crunch has knocked credit extension, consumer spending and company investment in the UAE and across the world. Without these an economy cannot grow.

Banks are reluctant to lend money - especially at low interest rates - because the crisis has made them nervous about the ability of people and companies to repay their loans.

In the Federal National Council on Tuesday, Obaid Humaid Al Tayer, the Minister of State for Financial Affairs, said the government would continue to ensure that there was enough liquidity in the local banking system. He also announced that the UAE is formulating legislation to ensure banks guarantee the deposits of their customers.

The banks need to support government's efforts to keep the economy moving, and begin to responsibly extend credit to those who can afford it.

Getting people and businesses in the UAE to trade and spend sustainably is the best way to keep the local economy growing during the international financial crisis.