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Time & Temperature in Doha

Economic Developments in the Middle East: Projects and Perspectives
Time to invest in Middle East

TRIBUNE NEWS NETWORK DOHA Speakers at the plenary on ‘Economic Developments in the Middle East: Projects and Perspectives’ said that for those with the dough and desire this was the time to invest in the Middle East, as not only were the bourses down over 50 per cent on an average but also the region was one of the few projected to grow during 2009 on strength of continuing public sector investment. Suggesting investors to distinguish between stressed assets and stressed asset holders, they said there could be stressed asset holders but most of the assets in the region were not stressed. Former US Ambassador to Greece and Senior fellow at Rand Charles Ries who moderated the plenary during the ‘Enriching the Middle East’s Economic Future IV Conference’ which concluded here on Tuesday, said that during the current year though the Middle East would face more dilemmas but it will continue to be a place of phenomenal opportunity. Raghu Mandagolathur of Markaz Investment Bank in Kuwait said that while the overall growth rate of Middle East economy would dip from 6 percent in 2008 to 2.5 percent in 2009 it would remain in the positive domain. “Only Saudi Arabia (-0.9), Kuwait (-1.1) and UAE would suffer negative growth. Qatar, which had doubled its production of gas, remains one of the brightest spots though it would suffer fall in exports,” he added. Among the strengths of the region, he recounted the oil and gas resources, low population and its young age profile, besides the welfare model of state where government expenditure kept the economy sustainable. “On the flip side are undiversified petroleumbased economies, high unemployment, ageing infrastructure, lack of regulatory mechanism, high inflation and an inflexible labour market,” he added. He said that the global economic crisis had come to the region as a blessing in disguise as it had led to inflation cooling off. He said despite the fall in petroleum prices it remained a profitable top produce as the current price of $52 a barrel was significantly above the break-even cost of $40. “The region has 2.7 trillion worth of projects of which 74 per cent are in real estate. About 50 percent of the cancelled projects belong to the UAE leaving the rest with much less cancellations,” he added. Thomas Caldwell, chairman and CEO of Caldwell Financial Limited, said that the financial system had been stabilised in the US, and the investor confidence across the world is likely to return sooner than later. “The Middle East has liquidity and demand and the stocks were under priced making it the right time to invest. This is the time to own a part of a bank rather than keep money in a bank,” he said. James Pickup director and general counsel of Middle East Investment Initiative, and Richard Schofield, senior lecturer, Department of Geography, Kings College, London, also spoke on the occasion. (AJ)

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