By Staff Writer www.arabianbusiness.com
The UAE Minister of Economy’s keynote speech from the 4th Arabian Business Forum is shown in full below
Your excellencies, ladies and gentlemen,
It is indeed an honour to address such a distinguished gathering of leaders from the government, key institutions and strategic business sectors.
Your presence here shows your confidence in the strong fundamentals and long term growth prospects in the Gulf region, and especially the UAE.
The UAE has demonstrated its ability to sustain economic momentum and drive growth despite the global slowdown and turmoil in some parts of the region.
Stability and unity are the cornerstones of social and economic prosperity in the UAE. As a federation of seven emirates the UAE has remained the most stable and successful example of unity in the Arab world.
The UAE remaining a beacon of stability and prosperity is one of the most important factors that bring us together on platforms like the Arabian Business Forum.
For the UAE government, it is also an opportunity to strengthen our communication channels with the business sector and deliver clear messages on where we stand now and where we are headed.
At the very outset let me make it clear that the UAE is firmly on the growth track – this year we are set to grow by 3-3.5 percent, with inflation well under control.
The UAE was the world’s 13th largest exporter with $235bn or two percent of the world’s total merchandise exports in 2010, surpassing major exporting countries such as India, Australia, Brazil and Malaysia, according to the latest World Trade Organisation (WTO) report.
The UAE was also ranked 18th largest importer in the world, having imported $170bn worth of merchandise goods, representing 1.4 percent of the world’s total imports.
According to the UAE National bureau of Statistics monthly inflation index declined for the fourth consecutive month in April 2011 by 0.10 percent, falling from 1.1 percent from 1.2 percent in March.
We expect inflation to rise 1 to 1.5 percent this year but it will not impact growth as economic diversification and increasing activity in logistics, trade and tourism sectors continue to create new opportunities.
The UAE is already a well-diversified economy with over 70 percent of its gross domestic product coming from non-oil economic activity.
Continuing infrastructure investments and the government’s decision to ensure that every corner of the country benefits from such investments present vast prospects for diversified economic activity.
For example, the government recently announced a $1.6bn infrastructure investment in the northern emirates, chiefly intended to provide better utilities coverage across these emirates.
The UAE is also a unique model where the private sector has entrenched itself as a major contributor to social and economic progress, chiefly on account of the diversity of its expertise and job creation.
Lately, the UAE has opened up further avenues for private sector expertise through public-private partnerships in a wide range of sectors.
For example, we are currently working on a US$11bn nationwide rail transport project and plan to spend 500 billion dirhams on aviation infrastructure over the next 10 years.
I cited these projects just to show the scale of developments the UAE will witness in the coming years and the level of expertise demanded by them.
As you are aware, ongoing infrastructure developments and structural reforms in the UAE reveal our focus on positioning the UAE as a global business destination.
We already have an advantage in being centrally located with fast and convenient access to the emerging markets across the Middle East, North Africa and South Asia (MENASA).
We know that is not enough. We want to build stronger links with the world, improve connectivity and facilitate movement of capital and goods to be acknowledged as global hub and gateway to the MENASA region.
The private sector can help us in our efforts to integrate global best practices into our business environment and facilitate transfer of world-class technology and expertise into the UAE.
The UAE will make sure that businesses and investors in the country find a comprehensive growth ecosystem, providing easy access to financing and markets as well as a competent regulatory framework, ethical business practices, fair competition and transparency.
The Ministry of Economy is currently working on the development and issuance of 19 laws to enhance performance of the UAE economy, through clearly defining and streamlining trademark, industries, arbitration, competition, investment, companies and small and medium enterprises (SMEs).
The new laws will reflect the best international practices in the conduct of business and take the UAE closer to its goal of being recognised as a knowledge-based economy.
The Ministry of Economy is committed to raise awareness about the fundamental concepts of a knowledge-based economy across the private and public sectors. Earlier this month the Ministry organised a ‘Knowledge Economy Forum’ to strengthen awareness on knowledge economy.
Driving the evolution of a knowledge-led economy is the strategic objective of the government.
The Ministry of Economy is committed to attract international expertise to support economic development by focusing on the introduction of advanced technologies.
These are aimed at boosting the efficiencies of various industrial and economic sectors. We are also focused on promoting a culture of innovation and research & development.
The world’s recent financial crisis raised many challenging questions to the world economies and the UAE was not different. As the GDP contribution of some major sectors such as real estate and construction began to decline, we were left with the question about the new economic sectors that we need to focus on. For a long time the UAE pursued a policy of diversification that proven to be a successful model that can sustain growth even during difficult times. The government represented by the Ministry of Economy and thus careful SWAP analysis of selected sectors identified such as industries, trade and tourism as the pillars that will form the core of our growth focus for the next five years.
The industrial sector currently contributes 10 percent to the UAE’s GDP, amounting to over AED160bn at current prices and according to our vision, we expect a positive growth in this sector, especially in downstreaming chemical industries, ship building, pharmaceutical and auto parts.
Trade, which traditionally played a major role in emirates such as Dubai will continue to benefit from the superior infrastructure and the growing demand from neighboring countries that enjoy high economic growth. Trade has registered positive growth of five percent for the year 2010.
The third sector that we expect positive growth in is the aviation and tourism. Taking advantage of the advanced tourism infrastructure and the keen commitments of both the federal and local governments to create an ideal environment to attract tourists to the UAE targeting a figure of 15 million tourists by 2020 from the current figure which is 9 million. This objective is not difficult to achieve specially the UAE does hold the necessary success tools such as airlines networks, modern airports and the best hotels in the region.
The UAE also sees itself as an integral part of the common vision and destiny of the Gulf region.
It’s part of the remit of the Ministry of Economy to remove barriers to movement of goods and facilitate trade between the GCC countries.
Recently, the 44th meeting of the Gulf Cooperation Council (GCC) Committee for Trade Cooperation and the 33rd meeting for the GCC Committee for Industrial Cooperation was hosted in Abu Dhabi.
GCC ministers who attended the meetings were able to make significant headway in ironing out major issues relating to goods movement and customs within the region. A major achievement was the approval for certificates of origin issued by GCC and the UAE Ministry of Economy.
We are confident the UAE and the Gulf region will make substantial progress in terms of unified positions and reforms as we move forward.
The challenges we foresee will further stimulate such closer co-ordination and integration with the global economy.
I take this opportunity to congratulate the organisers of the Arabian Business Forum for this exceptional assembly of industry leaders and decision-makers.
I hope this conference provides a new dimension and impetus to economic strategy and growth in the GCC. Wish you all success.
(HE Sultan Bin Saeed Al Mansoori is the UAE’s minister of economy. He was speaking at the 4th Arabian Business Forum, held at the Armani Hotel Dubai on May 23, 2011)