First German-Arab Investment Conference calls for continued economic partnership development

The rallying call came yesterday at the opening session of the UAE's first German-Arab Investment Conference, organised by Dubai International Capital and DaimlerChrysler in Dubai. The two-day conference is being held under the patronage of H.H. Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Chairman of the Executive Council.

Al Ansari pointed out that economic diversification is a high-priority for Arab investors, with massive increases in individual net worth, budget surpluses and rising oil-prices, generating a large capital pool in the region. In addition, Germany's recent powerful economic restructuring process has seen its productivity hit the highest level in eight years.

"The world's third largest economy, Germany, and the Middle East and North Africa region have a long-standing relationship. However, further proactive dialogue is needed to aid the development of long-term strategic partnerships," Al Ansari said.

The investment forum has brought together prominent German Chief Financial Officers and senior executives from major corporations including Bodo Uebber, DaimlerChrysler; Dr. Kurt Bock, BASF; Stephan Gemkow, Deutsche Lufthansa; Kiran Bhojani, EON; Dr. Klaus Sturany, RWE; Dr. Werner Brandt, SAP; Joe Kaeser, Siemens; and Hans-Peter Ring, EADS; and influential investors and business leaders from the Arab region.

"The German economic model and that of the Arab world have similar features, and both can greatly benefit from each others' sustained development. We believe this forum will be a key platform to develop bilateral investment opportunities between these two financial powerhouses," added Al Ansari.

Recent economic reforms in Germany have seen the country experience a self-proclaimed Wirtschaftswunder, or economic miracle, which is proving to be a major tool in drawing increased foreign direct investments from the Arab world.

Germany has increased productivity over the last two years, averaging a 1.7 percent annual rate rise, doubling its performance from 1998-2004. In addition, German merger and acquisition activity is likely to top US$ 160 billion per year in 2005 and 2006 - double that of the previous three years.

The Middle East is also boasting considerable growth rates with the Institute of International Finance recently reporting that the GCC grew 75 percent in the last three years making it the 16th largest economy in the world.

High net worth individual wealth has also grown significantly in the Middle East since 2002. In the last financial year, it grew by 28 per cent - faster than any other region in the world. Currently, GCC citizens own more than a trillion dollars in assets held abroad in global financial systems.

Al Ansari said: "If we take the fact that the GCC alone is expected to accumulate a budget surplus of US$ 500 billion between 2005 and 2010, and combine this statistic with massive increases in available capital, the Arab world is proving to be a very promising investment partner."

The forum between the Middle East and Europe's largest economy has attracted high-level sponsorship from Goldman Sachs, JP Morgan and Freshfields Bruckhaus Deringer.