Sharjah FDI Forum 2019 to examine spurt of emerging global challenges

Business Bureau. Gulf Today

In recent years, the trend in Foreign Direct Investment (FDI) flow to developing countries in Asia and Africa have continued to increase (World Investment Report 2019, UNCTAD). Future growth in FDIs continue to favour emerging markets.

While experts see the flow of investments from developed economies to emerging markets as a normal trend, they predict that it will not impact the growth rate of the host countries.

The World Bank, International Monetary Fund and the UN are in agreement with reports issued by the Davos World Economic Forum that the global economy has been facing a mix of long-standing and emerging vulnerabilities since the global crisis in 2008. Limited intervention policies in the wake of a new crisis; disruptions by intensifying automation and digitalisation; and a build-up of protectionist pressures against a backdrop of rising nationalist and populist politics, all foretell an uncertain future.

These changes and their impact will be in focus during the 5th edition of Sharjah FDI Forum, which will take place on November 11-12, at the Al Jawaher Reception and Convention Centre (JRCC) in Sharjah. The event held under the patronage of His Highness Sheikh Dr Sultan Bin Mohammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, is organised by the Sharjah FDI Office (Invest in Sharjah), which operates under the Sharjah Investment and Development Authority (Shurooq).

Mohamed Juma Al Musharrkh, CEO of Invest in Sharjah, said: “Through the two-day event, we aim to highlight key developments in the global economy, and provide clear perspectives to companies, investors and decision makers on formulation response mechanisms, through a range of discussions led by local, regional and international economists.”

He said that migration of investment to emerging markets helped achieve balanced growth and stimulated global trade. However, he stressed the need to identify the reasons behind investors’ interests in these markets in order to assist experts in their global economic forecasts and help them map the movement of investments.

The Invest in Sharjah CEO said that the forum would showcase Sharjah and the UAE as a model for sustainable growth and resilience by diversifying and focusing on vital sectors such as education, healthcare, smart infrastructure, services and manufacturing. He cited a recent World Bank report that predicted a growth in regional markets.

Al Musharrkh said the formulation of policies based on the requirements of future economies, including an emphasis on advanced skills and smart infrastructure, was what set the regional market apart. This encouraged inclusive and balanced sector-wise growth, he said, pointing out that investment in economies should be focused on sustainability and long-term growth.

The IMF’s World Economic Outlook 2019 suggests a practical mechanism for the adoption of effective measures by institutions and policymakers to protect growth and sustainability. These include spending on structural reforms, ensuring the sustainability of public resources over the medium term, and facilitating macroeconomic policies based on country-specific circumstances.

The UN Environment 2018 Annual Report revealed that global investments in renewable energy reached US$ 288.9 billion in 2018, far exceeding funding in fossil fuels. Also, the Middle East and Africa region witnessed a leap of 57 percent in investment to USD$ 15.4 billion, while investment in the Americas (excluding Brazil and the United States) declined 23 percent to $ 9.8 billion. The same applied to the information technology sector. Stronger investment flows into emerging markets has contributed to the growth of communications, renewable energy and information technology sectors, and allowed better distribution of technology.

Commenting on the shift of technology from established economies to emerging markets, Al Musharrkh said: “In the next few years, we will see a significant reduction in the technological skills gap globally, and a qualitative improvement in smart services, infrastructure, legislation and regulations in emerging markets, due to the increasing opportunities they provide.”

“FDI in industry and technology sectors in the developing and emerging markets will lead to the advancement of the health and education sectors. We have seen giant industrial and technology companies move to markets outside their countries. This necessitates their involvement in the development of education and R&D in order to have skilled human resources in management, production and marketing for the sustainability and growth of their businesses. In this manner, FDI becomes a key player in the development of host countries,” he continued.