DIFC looks to double number of companies
'Institutions are using Dubai not just as a base for business in the Gulf, but as a base to access a much wider area.'
February 17, 2013 11:07 by kippreport
The Dubai International Financial Centre (DIFC) looks to double the number of companies over five years by serving as a base for business with China, south Asia and Africa.
With political unrest plaguing parts of the Middle East and Western financial firms still retrenching because of debt problems in their home markets, the business environment is challenging for Dubai.
But Jeffrey Singer, chief executive of the DIFC Authority, which manages the business zone, says Dubai could keep expanding rapidly as the Gulf’s main financial centre by becoming a conduit for trade and investment with a larger region.
“Increasingly, institutions are using Dubai not just as a base for business in the Gulf, but as a base to access a much wider area,” he tells Reuters.
The DIFC, which opened in 2004, is one of the UAE’s “free zones”, offering foreign investors 100 percent ownership.
The number of registered firms operating in the DIFC rose by 7 percent last year to 912, while workers at those firms jumped by
16 percent to 14,000. The DIFC says it wants to double its size in five years from 2011, when it had 848 companies.
In the past the DIFC has had to contend with the shrinkage of some of its top U.S. and European clients. This week, Citigroup Inc began laying off investment bankers across its Europe, Middle East and Africa division, with 50 positions to be eliminated in the near term.
But Singer says that, overall, cutbacks of investment bankers and back-office staff at Western institutions in the DIFC had been more than offset by expansion in other areas, as foreign firms tried to capture part of the oil-rich Gulf’s infrastructure spending boom.
In some cases, retrenchment by foreign firms in the Gulf region has prompted them to bring back staff from other parts of the region to Dubai, actually boosting their presence in the DIFC.
“The European presence has grown every year in terms of both employment and the number of firms here,” adds Singer.