Feeding off each other
DIFC is the world’s 7th most competitive financial center, while Dubai is the 10th, according to a report by the DIFC and KPMG in the UAE. The authorities claim that DIFC’s success-story is boosting Dubai’s profile. How?
December 22, 2009 12:53 by Dana El Baltaji
The Dubai International Financial Centre (DIFC) was ranked seventh out of 15 countries in a competitiveness study titled the ‘International Financial Centres Competitive Assessment Report’, conducted by the DIFC and KPMG in the UAE.
DIFC beat notable financial centers in the West, including Frankfurt, Germany and Paris, France. It also outclassed regional centers surveyed in the report, including Doha, Qatar and Riyadh, Saudi Arabia.
Interestingly, however, while DIFC was ranked seventh, Dubai was ranked tenth. The DIFC’s “world-class legal and regulatory standards” and its “independent regulator and judiciary system” were cited as reasons for its competitiveness, which suggests that Dubai’s own regulator and judiciary system are not as world-class.
In fact, the DIFC’s independent legal framework begs the question: If Dubai’s judiciary system is as outstanding as local officials claim, why would the government feel the need to create an independent financial center like DIFC in the first place? If Dubai’s legal system is world-class, it should be enough to attract foreign businesses, right?
Maybe not. The governor of the DIFC Ahmed Humaid al-Tayer said in an emailed statement that “the results of the report underscore the interdependent relationship between DIFC, Dubai and the UAE. While Dubai and the UAE have gained from DIFC’s achievements in the international arena and its strong commitment to global best practices, DIFC has benefited immensely from the infrastructure created by Dubai and the UAE.”
In short, DIFC’s got the first-class goods, while Dubai and the UAE have skeletal framework.
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