x Abu Dhabi, UAEWednesday 26 July 2017

Mutual benefit in trade, ministers tells US

Sheikha Lubna al Qasimi, the Foreign Trade Minister, has called for closer business relations with America, citing a better understanding by both countries.

Sheikha Lubna al Qasimi, the Foreign Trade Minister, visited the United States this week.
Sheikha Lubna al Qasimi, the Foreign Trade Minister, visited the United States this week.

Less than three years after a political firestorm overtook DP World's bid to acquire ports operations in the US, Sheikha Lubna al Qasimi, the Foreign Trade Minister, has called for closer business relations with America, citing a better understanding by both countries. In a speech before the National US-Arab Chamber of Commerce in Washington DC on Friday, Sheikha Lubna said the UAE had learnt hard lessons from the Dubai Ports World controversy and vowed to enhance trade and industry between the two nations. "One of the lessons of the 2006 DP World fiasco was that we lacked a sufficient understanding of the US and the need to meet various constituencies here," she was quoted by state news agency WAM as saying. "We learned a lesson the hard way that it's important to reach out across the country and not to focus only on Washington DC." Sheikha Lubna told the audience of business people, diplomats and officials that the UAE's continuing strong economy will be vital to a US economic recovery. In 2006, Dubai Ports World, wholly owned by the Dubai Government, took over Singapore-owned P&O, which had management contracts to run six major US seaports, 16 lesser ports, and dock works in another 21. The year before, DP World had approached the US government's foreign investment watchdog to gain approval. But the deal sparked fierce bipartisan opposition from Republican and Democratic representatives who, in a congressional committee, voted 62-2 to block it. Despite support for the deal from George W Bush, the US president, and amid claims that opposition was fuelled by anti-Arab racism, DP World ceded the arrangement and turned over US ports operations to an American company, a wholly owned subsidiary of the insurance giant, American International Group. In September AIG was the subject of the biggest bailout of a private company in US history. AIG gained a US$85-billion (Dh312bn) line of credit in return for a 79.9 per cent equity stake by the US government after its credit rating was reduced by exposure to the failing mortgage market. Since the deal failed, the UAE and other nations with large sovereign wealth funds (SWFs) have met to allay concerns about investments by the funds. In Chile in September, the leading SWF nations agreed on a voluntary code of conduct that included not using their wealth for political purposes. The UAE is home to the world's largest SWF with the Abu Dhabi Investment Authority controlling assets estimated to be $500 billion. Sheikha Lubna told the private luncheon, hosted by the National US-Arab Chamber of Commerce, that the UAE's continuing strong economy would aid the two countries' economic and political links. David Hamod, the president and chief executive of NUSACC, said the turmoil in global markets was timely for the meeting's focus. "The Arab world has the potential to play a very important role in helping to stabilise global financial markets, and US institutions are looking for reliable, well-heeled investors," Mr Hamod said. "[Sheikha Lubna's] presence here has sent a strong message that the UAE remains open for business, and there is keen interest in two-way trade and investment. "If the US wants to continue promoting trade and investment with the Arab world we should listen to Sheikha Lubna." Sheikha Lubna said the image in the US of the UAE was dominated by its oil and gas reserves, but nearly half of its gross domestic product was generated from services. "That is because when you export to the UAE, you are looking at a potential market of almost a billion consumers in the Arab world and Asia," she said. "With this in mind, we have developed some of the world's best logistics centres when it comes to imports, exports and re-exports." Of the two men vying for the US presidency on Tuesday, Republican senator John McCain supported the DP World deal at the time. His Democratic opponent, Barack Obama, opposed it, as did former Democratic candidate, senator Hillary Clinton. Yesterday, Sheikha Lubna opened the NUSACC policy maker's conference with a speech that cited the UAE's status as the US's largest trade partner in the Middle East, and the 21st biggest importer of US goods and services. jhenzell@thenational.ae @Email:jhenzell@thenational.ae