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Feeding off each other

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

However, according to Vijay Malhotra, Chairman and CEO of KPMG in the UAE, DIFC will help boost Dubai’s image internationally: “DIFC’s performance on the International Financial Centres Competitiveness Assessment Report is a reflection of its leading soft and hard infrastructure […] The results of the report clearly highlights that, leveraging on DIFC’s immense potential, Dubai is all set to play an important role in the global financial services industry map.”

Either Malhotra is an upbeat, optimistic man, or Kipp is looking at the wrong report, because coming in tenth place out of 15 locations isn’t exactly an indication that Dubai is ready to play an “important role” globally. Dubai beat financial centers like Doha, Riyadh and Dublin, Ireland, which is hardly an achievement.

Kipp understands that this is a difficult time for Dubai, but there’s only so much positivity you can juice out of this report. Dubai’s reputation as a viable financial hub is in trouble due to years of poor transparency laws and corporate governance practices; and while Dubai government’s gargantuan debts have harmed the emirate’s reputation significantly of late (have we agreed that they’re government entities, or is that still in dispute? Shall we call them private-public to stay on the safe side? How about public with a private twist?), reports about a lack of a clear-cut legal framework in Dubai have circulated for years. Dubai’s problems extend beyond its debts, that’s for sure.

So how will DIFC elevate Dubai’s profile if the emirate’s core issues as a financial center (lack of transparency, etc) are not addressed? And why is anyone proud to note that an independent financial center within Dubai fared better than the emirate’s own financial center?

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