The UAE is exploring future investment opportunities after the Covid-19 pandemic transformed economies, paved the way for new sectors, hastened the use of advanced technology and raised the need for sustainable growth.
The Emirates, the Arab world's second-biggest economy, will host the inaugural Investopia global investment summit on March 28, 2022, the Ministry of Economy said on Wednesday.
The forum will host a global gathering – including world leaders, private sector companies, banks, family businesses, investment funds, universities and research institutions – to launch more than 100 investment opportunities in the UAE, the region and the world.
Investopia “will be a platform for dialogue on the future of world economies”, said Abdulla bin Touq, UAE Minister of Economy. “Through this platform, we are offering a new space to formulate innovative models for the future business environment and partnership patterns that will generate new investment opportunities.”
As part of its plans to boost economic growth, the UAE will seek Dh550 billion ($150bn) of inbound foreign direct investment over the next nine years, amid plans to eventually attract Dh1 trillion in FDI by 2051, according to the Ministry of Economy.
Investopia is one of the events within the first set of the Projects of the 50 developmental and economic initiative that was announced by the UAE government earlier this year.
It is also the first platform that unifies all national investment opportunities and development projects from all emirates in line with the Projects of the 50 initiative, the ministry said.
The opportunities are in priority sectors such as information and communications technology, education, health care, transport, supply chains, logistics, entertainment and media, financial technology, energy, water and space, it said.
The summit will focus on promoting responsible and sustainable investments to maximise their developmental and social impact.
It will also focus on investments in digital transformation – especially in trade, services and digital supply chains – and review the shift to distance learning, remote working and e-commerce, which paves the way for wider applications of artificial intelligence, robotics, blockchain and 5G telecoms services.
The summit will also provide participants with a database of investment opportunities and incentives in various countries. Governments will be able present their development projects to investors and investment regulators.
Asked about expectations for the UAE's GDP growth this year, Mr bin Touq said economic expansion will exceed the forecasts of 2 per cent to 3 per cent given by the UAE Central Bank and the International Monetary Fund.
The UAE has spent billions of dirhams in economic stimulus measures to support businesses since the Covid-19 outbreak began last year.
Business activity in the country's non-oil private sectors continued to improve in October, boosted by the easing of Covid-19 restrictions, a rise in tourism and increased spending amid the economic recovery.
The UAE's headline PMI reading climbed to 55.7 in October, from 53.3 in September, underpinning a marked increase in new business during the month, driven by rising spending amid the opening of Expo 2020 Dubai.
A reading above 50 indicates economic expansion while anything below points to a contraction.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Fireball
Moscow claimed it hit the largest military fuel storage facility in Ukraine, triggering a huge fireball at the site.
A plume of black smoke rose from a fuel storage facility in the village of Kalynivka outside Kyiv on Friday after Russia said it had destroyed the military site with Kalibr cruise missiles.
"On the evening of March 24, Kalibr high-precision sea-based cruise missiles attacked a fuel base in the village of Kalynivka near Kyiv," the Russian defence ministry said in a statement.
Ukraine confirmed the strike, saying the village some 40 kilometres south-west of Kyiv was targeted.
If you go
The flights
Etihad (etihad.com) flies from Abu Dhabi to Luang Prabang via Bangkok, with a return flight from Chiang Rai via Bangkok for about Dh3,000, including taxes. Emirates and Thai Airways cover the same route, also via Bangkok in both directions, from about Dh2,700.
The cruise
The Gypsy by Mekong Kingdoms has two cruising options: a three-night, four-day trip upstream cruise or a two-night, three-day downstream journey, from US$5,940 (Dh21,814), including meals, selected drinks, excursions and transfers.
The hotels
Accommodation is available in Luang Prabang at the Avani, from $290 (Dh1,065) per night, and at Anantara Golden Triangle Elephant Camp and Resort from $1,080 (Dh3,967) per night, including meals, an activity and transfers.
