A letter from Berlin

Last week saw the 5th annual German-Arab business forum in Berlin, and around 500 representatives gathered to hear about future prospects for the $70bn-a-year in German trade with the Middle East.

Such occasions are great for networking, but also offer a chance to gain a fresh perspective on the Middle East, its opportunities and problems. So what was the message from Berlin this year?

September 11th has quietly dropped off the agenda. Hardly anyone mentioned this fateful date, and the feeling was very much, let's get on with business, nothing has really changed. Indeed, German exporters are now probably more welcome than ever in the region, their US rivals somewhat less so.

Secondly, Saudi Arabia succeeded in arousing a good deal of interest in its economic reform process. True, the Kingdom rolled out its finance minister, foreign investment chief and the head of the chambers of commerce. But their message was exactly what a business audience wanted to hear.

Saudi Arabia is promising to open more sectors to foreign business in the near future, and its electricity and water sectors offer a $40 billion investment opportunity. Moreover, the $25 billion Saudi Gas Initiative will mark the return of the foreign oil majors to Saudi soil, though negotiations are currently stalled and drew little comment in Berlin.

Outside the Kingdom, German exporters see potential in the reforming economy of Syria and even Egypt, where a host of power projects will be attracting attention from the likes of Siemens over the next decade.

There is also a big push to get small and medium sized companies to begin exporting directly to the Middle East. The Berlin forum witnessed the launch of the Business Gate Middle East, an Internet portal designed to put SMEs directly in touch with the region.

This is good news for the Middle East, as German SMEs are well known for their efficiency and low costs, and will undercut the larger groups that normally charge a substantial mark-up for their services. It also shows how the opening of regional markets can bring unexpected benefits in the shape of more cost competition amongst exporters.

For there is no doubt that German exports and investment will continue to benefit economic growth in the Middle East, and have a good deal to contribute in terms of technology, expertise and organization.