DUBAI // Abu Dhabi is to assess the feasibility of existing projects due to the global crisis, a member of the Abu Dhabi Economic Development Council has admitted. Hussain al Nowais said today that the emirate is also considering mergers in its banking and financial services sector as the global financial crisis signalled a need to review some of the city's positions. "I think the credit crisis will help us reflect and make sure the projects we are proceeding with are attractive and feasible," he said.
Mr Nowais, who is also chairman of Emirates Holdings, one of the largest holding groups in the country and a board member of other government institutions in the capital, added that it was time to "reflect and consolidate". "The fundamentals of the economy are strong," he added. There has been speculation that the credit crunch will force banks in the region to consolidate on the back of tight lending conditions and slower project funding. In September, there was talk that Abu Dhabi Commercial Bank (ADCB) would fall into the arms of larger rival National Bank of Abu Dhabi (NBAD) to create the biggest lender in the UAE.
Both banks denied plans to merge were in the offing. Last month, banks were warned to brace for slower growth in their loan books after a period of massive expansion in the past year. The Government has offered banks an emergency Dh70 billion (US$19.05bn) injection of funds in an attempt to ease a credit shortage, the first round of which will be offered on favourable terms on condition the money is not used for speculative activities. Mr Nowais was speaking on the sidelines of the opening day of the inaugural Summit on the Global Agenda in Dubai, which will see some of the most influential thinkers of our time coming together to try and solve the most pressing problems facing humanity.
Economics and finance are among the key topics to be discussed during the three-day conference by more than 700 experts from academia, business, government and society. Klaus Schwab, founder and executive chairman of the World Economic Forum, said: "This is an exciting and historic venture, made more timely by recent events. "The challenges faced by the world today are more complex, more interrelated, more intractable than ever before. "In these crucial times, what we want to do is find the right formula with transparency so that the next generation can benefit. We just have to look at the global financial crisis to see we need to do something about our future." Mr Klaus, speaking yesterday, highlighted the importance of the role developing countries such as the United Arab Emirates could play in framing the future. "Strong emerging countries have a say on how the future is shaped, and one of the reasons why we will have the summit in Dubai is because the country here has a vision and a strong growth potential," he said. Health, religious extremism and social values are also on the agenda for what will become an annual event. Delegates will select the 10 most important ideas for improving the state of the world. Participants will form Global Agenda Councils and engage in workshops, setting prioritiy areas for action and collaborating on possible solutions. "Problems in the world usually start in the developed countries and then hit the emerging, or developing countries," said Mohammed Alabbar, member of the Dubai Executive Council and chairman of Emaar, who used as an example the current global economic crises that started with the crash of the US housing market. "Dubai is a perfect place for such an historic meeting, which comes at a time when the world is facing challenges that have no parallel," he added. The event was due to be officially opened by Sheikh Mohammed bin Rashid, Vice President of the UAE and Ruler of Dubai. Ideas from the summit, which is held in partnership with the Government of Dubai and took 11 months to plan, will be presented at annual meeting of the World Economic Forum in Davos, Switzerland, in January. shafez@thenational.ae * With Reuters copy
