Dubai FDI chief aims to break down trade barriers

For Fahad Al Gergawi, attracting foreign direct investment is an ongoing and constantly evolving mission. Ahead of Expo 2020, his is a role that will only grow in importance.

Dubai has traditionally been a trading hub, according to Fahad Al Gergawi, the chief executive of the Dubai Investment Development Agency. Pawan Singh / The National

Foreign direct investment (FDI) is the solid evidence that the international business community values a country’s economic policies, its infrastructure plans and its overall “liveability”.

Attracting FDI is also one of the fundamental drivers behind economic growth, and has been a feature of policymakers’ strategy in Dubai since the foundation of the UAE in 1971. “If you build it, they will come”, the motto often attributed to the emirate’s leadership, encapsulates the essence of Dubai’s appeal for FDI: we will provide you with the essential foundations for sound investment in our country; in return, we seek your presence here, in physical and financial form.

In recent years, the magnetic strength of Dubai – and the rest of the UAE – has accelerated beyond traditional sources in Europe, the United States and India. The emirate’s status as a “safe haven” during troubled times in some countries in the Middle East has given FDI a new impetus.

Official figures show FDI into the UAE has tripled since 2009 and is expected to rise again by 20 per cent this year, to nearly US$15 billion.

The man in charge of implementing the policy – Fahad Al Gergawi, the chief executive of the Dubai Investment Development Agency (known also as Dubai FDI) – explains the strategy, and how it fits in with the emirate’s grand plan to stage Expo 2020.

How important is FDI as a part of Dubai’s economic expansion plans?

FDI is the lifeblood of any economy. It drives reform, improves quality of life and ultimately brings prosperity. Attracting FDI is one of the cornerstones of a country’s further economic development. Apart from capital investments, FDI has other advantages, most notably knowledge and technology transfer, increased trade flows, job creation and increased opportunities for local businesses. Dubai has traditionally been a trading hub and the policy thrust on economic diversification and ease of doing business offers wider scope for foreign and investment. While logistics, trade and tourism remains the key drivers of economic activity, Dubai’s strategic plan for sustainable development is essentially linked to attracting best-in-class knowledge and expertise from everywhere through long-term investments.

What are the main attractions for foreign investors in Dubai?

Dubai is a central location between the East and West as well as North and South, well-connected to a consumer market of over 2.2 billion people across the Middle East, North and East Africa and South Asia. A world-class infrastructure for diverse business operations is already in place as a result of sustained public and private sector investments. Dubai is also a cosmopolitan community that provides quality living and varied lifestyles as well as a global leader in services. With its zero tax environment and focus on ease of doing business, Dubai provides investors a competitive environment to navigate and make quick decisions. Setting up a business in Dubai is sophisticated yet simple and investors have various options to choose from, including over 23 free zones that allow 100 per cent ownership and repatriation of income and profits.

What sectors are most likely to generate high returns to FD investors?

Dubai is the third re-export centre globally after Hong Kong and Singapore. Trade, services, logistics, aviation and tourism will continue to be a major driver of economic activity in Dubai, providing more opportunities across allied sectors such as transport, hospitality and leisure too. Information technology, financial services and health care are sectors that have fast evolved as a key contributor to Dubai’s GDP. Dubai’s real estate and construction sector is also getting back on track for healthier, realistic growth. In recent years, Dubai has also launched landmark initiatives such as the Green Economy Partnership, Islamic Economy and Dubai Smart Government to make Dubai a hub of excellence and innovation in each of these sectors. The initiatives are backed up by strategies to create partnerships to attract expertise and enterprise in each of these sectors. Dubai continues to develop its growth plans and strategy with substantial emphasis on bringing high value to foreign direct investment. With its strong links to Africa, the Middle East and South Asia, which together accounts for one-third of world population, Dubai offers the best growth proposition for anyone who choose to invest in the city.

How is the FDI policy being coordinated with the Expo 2020 project?

Preparations for Expo 2020 are being coordinated by a dedicated higher committee and Dubai Investment Development Agency will fully support the roadmap to be evolved by the committee. The FDI policy will always involve making Dubai a business friendly environment by reducing barriers to entry and encouraging trade and investment. However, Dubai FDI’s policy will not be solely directed to Expo 2020, but also towards the development of Dubai beyond the event.

Which foreign countries are the biggest investors in Dubai?

As of now the US, the UK and India account for the major share of FDI inflows to Dubai. But at the same time we are witnessing the source markets expanding with more and more multinationals and companies from different regions and countries expressing interest in moving to Dubai. In recent years companies from Latin America are making their presence felt in Dubai along with many from western and eastern Europe.

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