Dubai International Financial Centre

By spring at the latest the first clutch of famous names from the financial services industry will be licensed to operate from the DIFC. There will also be numerous announcements about the individual laws governing the centre as well as rules and regulations issued by its new regulatory council.

In September the DIFC will receive an enormous promotional benefit from the holding of the annual meetings of the World Bank and International Monetary Fund in Dubai. This will launch the DIFC on to the global stage, and the World Bank has already promised to launch the first DIFC bond.

From the point of view of the $2 billion physical infrastructure of the DIFC - on a long strip of land from the Emirates Towers behind the Sheikh Zayed Road - construction will get under way. First to emerge from the ground will be a huge translucent arch, The Gateway, symbolizing transparency.

And over the next few years several new skyscrapers will appear and a maze of interlinked office buildings. The world's first new financial community since London's Canary Wharf will be virtually complete within five years at the most.

To undertake the DIFC at a time when the world's financial community is mired in its worst recession for 30 years might seem ridiculous. And yet banks and financial institutions are queuing up to get licensed. Why?

The answer is that they are looking beyond the near term problems of the Middle East - such as an imminent possibility of war in Iraq - and towards a brighter future. They can see a massive, neglected opportunity to develop capital markets and a financial centre to serve a wealthy region, and they are going to seize it. Furthermore, Iraq and Iran may be problem areas today, but they are the customers of tomorrow.

Moreover, the DIFC will offer a world-class banking infrastructure with operating and living costs at a fraction of that found in the major financial hubs like London and New York. At a time when costs drive the bottom line, this is an argument likely to hold weight in many boardrooms.

In deliberately courting the top 100-200 financial institutions in the world, the DIFC is not trying to create an offshore banking hub. It will leave that business to Bahrain.

Rather the DIFC will serve the needs of international investment banks, insurance and re-insurance companies, Islamic financial institutions and provide back-office services for the giants of the global financial community.

For these institutions the regulatory framework has to meet the highest standards in the world, and the DIFC has recruited some of the best regulatory talents to ensure that these requirements are fulfilled.

But make no mistake, the DIFC will dwarf any other free zone project attempted by Dubai in recent years, and it is an important step for the development of the entire region.