Sunday, 19 May 2013

UAE Building GDP By Investing Wisely in Ports/Infrastructure

In the business world there is an old adage that states "You have to spend money to make money." When you are a nation that wants to grow their economy, the UAE’s Minister of Economy, Sultan bin Saeed Al Mansouri, believes "If a country is not building, it’s economy is stagnant." He continued by saying, "A robust construction sector signals economic vibrancy and infuses energy into a number of other sectors as well, generating demand for building materials and technological innovations, and thereby boosting the economy further." Just taking a look at what is happening in the UAE now and in the past decade, proves that his theory is 100 per cent correct.

The UAE’s massive infrastructure projects have not only created economic stimulus leading to increased prosperity but they are also laying a solid foundation for future growth in the region. Their vision for their major ports are a testament to what can be realized, when you have a philosophy you strongly believe in and go about implementing it. In December 2012, the UAE opened its multi-billion dollar Khalifa Port and Jebel Ali Port is currently undergoing an expansion that will raise it’s annual capacity to handle 19 million TEU by 2014. The two ports are expecting to be complimentary to each other and will not be in competition together.

The UAE has also been working on diversifying their economy and have poured substantial amounts on investments into building new manufacturing centers creating even more jobs and adding to their GDP. Although the nation’s GDP level has not been as strong as before the western financial crisis began in 2008, it still managed to weather the storm by and large and is now reviving it’s ambitious plans to keep building for the future and GDP is expected to grow at record rates accordingly as the west continues to climb out of their fiscal nightmare they put themselves in.

In the meantime, the UAE has been capitalizing on the growth of the east’s emerging markets and sees many great investment opportunities for the future, where there was little before. As the country grows it’s manufacturing base while diversifying it’s economy, their non-oil exports into these new growth markets will help contribute to grow their GDP. The UAE is in a perfect geographical location to take full advantage of the growth of the world’s emerging consumer markets and they are building their economy and their ports to do so. The UAE’s leadership is determined to adapt to the ever-changing growing global economic landscape and are giving investors a good reason to invest, by building their domestic infrastructure and economy, in order to do it. It seems like a simple enough strategy for other countries to emulate.

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