Dubai exports driven by free zones

Dubai - Internet City and Media City

Businesses operating from free zones in Dubai now drive a full 40 per cent of the emirate’s Dh217 billion (US$59bn) export market as the importance of the economic clusters continues to grow.

Companies based in these economic hubs exported or re-exported Dh86bn worth of goods during the first half of the year.

That compares with Dh131bn worth of direct exports and re-exports from local businesses outside the free zones, according to Dubai Exports, an agency under the Government’s Department of Economic Development.

“The start of this year has been very promising, particularly in terms of trade and exports for Dubai,” said Saed Al Awadi, the chief executive of Dubai Exports. “Exports are continuously growing, with some products showing high potential to expand further.”

India alone commanded a 45 per cent share of the value of total exports from Dubai during the first six months of the year, which is up from an average of 40 per cent for all of last year. The country’s appetite for gold and jewellery has helped to make it the top export destination for the emirate.

Switzerland is another popular export destination for the same reason. India and Switzerland together accounted for 87 per cent of Dubai’s precious-metals exports last year.

Demand for Dubai’s commodities has been growing globally as more investors flee to what they perceive are safe alternatives to local stock markets, which have been volatile of late.

Exports of prepared food products, chemicals and cement have also been strong and are expected to grow further, said Mr Awadi.

But the growth of trade from Dubai’s free-zone businesses, in particular, illustrates how much of an effect these companies are having on the local economy.

The first free zone, Jafza,opened 26 years ago at the port of Jebel Ali. This hub, along with others that were launched about that time, were “started initially to promote re-export”, says Jitendra Gianchandani, the chairman and managing partner of Jitendra Consulting Group, which advises businesses about free zones.

Yet many business consultancies have also popped up in newer free zones in recent years.

While the turnover of these consulting services are not included in Dubai Exports data, they are also having a major effect on the local economy, experts say.

More than 50 free-zone companies in the information and communications technology sector alone have expanded their operations this year, said Malek Sultan Al Malek, the managing director of Dubai Outsource Zone and Dubai Internet City.

via Dubai exports driven by free zones – The National.

Zuma urges opening up of world economy

CAPE TOWN/SOUTH AFRICA, 12JUN2009 - Jacob Zuma...

Johannesburg – World markets must open up to the least developed countries that had become “innocent bystanders” of the global financial crisis, President Jacob Zuma said on Thursday.

“We feel strongly about the need to open up the world markets in order to stimulate the recovery of the global economy,” he told a business meeting in France.

“The participation of low-income countries in global trade is crucial for their growth and poverty reduction endeavours,” Zuma said.

The meeting took place on the sidelines of the G20 Summit in Cannes.

Zuma said change was inevitable in order to curtail the effects of the crisis and “realistically” attain a higher and more equitable growth.

“We believe that this current crisis should lead to a realisation that change is inevitable. Balanced growth is just as important as strong and sustainable growth.”

Addressing growth was not possible without first dealing with the root causes of imbalances in the global economy.

“To this end, we need stronger commitments from large deficit and surplus countries to do a number of things.”

These included strengthening the fiscal policy environment, maintaining appropriate monetary policies and refraining from protectionism.

Zuma said surplus countries should support investment in developing and low income countries.

This would contribute enormously to promoting development, poverty reduction and decent work.

“Populations in emerging economies and least developed countries will continue to be subjected to harmful and excessive economic volatility and risks until agreement on these often divisive issues is reached within the G20,” Zuma said.

via Zuma urges opening up of world economy: Fin24: Economy