DUBAI: The development of free zones can help resource-reliant countries in Latin America successfully diversify their economies, panellists told the inaugural Global Business Forum on Latin America 2016 which was recently held in Dubai. Speaking during a panel session entitled Accelerating Diversification – The Power of Zones, Hamad Buamim, President and CEO of the Dubai Chamber of Commerce and Industry, highlighted the success of the Dubai free zone model, which started with the establishment of Jebel Ali Free Zone in 1985. Today, he said, more than 20 free zones operate in the emirate, accounting for 75 per cent of Dubai’s exports, and 25 per cent of its GDP. “Free zones are clusters of the economy that have diversified Dubai, enabling us to achieve what we have done today. I think one thing free zones were successful in was inventing the single window services. They were able to get all the government departments and private sector players together and offer their customers something that nobody offered at that time. Free zones were ahead of their time,” said Buamim.
Dubai Chamber’s president and CEO expressed his optimism about Dubai’s model of connecting, airports, ports and free zones as a concept that could be adapted in Latin American countries. “It’s a great concept that gives it a major advantage. So if other countries take this concept and are able to address it in that way and reach an underserved market where they can distribute to, I think it can work there as well,” he said. Also speaking on the panel was Nasser Al Madani, board member of the World Free Zones Organisation and Assistant Director General of Dubai Airport Free Zone, who explained why the UAE and Middle East could learn valuable lessons from Latin American countries with established and successful free zones.
“Latin America, in terms of free zones, has been in the industry [much longer than] Dubai and has a lot of successful examples [such as] single-company free zones and off-shore free zones,” Al Madani said.
He added that he sees 100 per cent foreign ownership as the main attraction for companies setting up in Dubai’s free zones. He added that services provided within these areas as well as the proximity of nearby ports and airports also play a major role in attracting foreign companies to the emirate. Sharing his perspective, Paul Griffiths, CEO of Dubai Airports, said that more direct air services between the UAE and Latin America would be the first step to developing trade relations. In his view, Dubai could serve as a transport hub to drive trans-shipment to other destinations worldwide which could create a “multiplier effect” for Latin American exporters.
“Direct air services to a hub like Dubai with 260 onward destinations give immense opportunities for communication and trade to be established,” Griffiths said.“The existence of free zones both at point of origin and point of trans-shipment will be a tremendous way to boosting that. The development of Dubai World Central phase 2 will [allow future] capacity to foster trade links between Latin America and the Middle East,” he added.
The inaugural Global Business Forum on Latin America, organised by Dubai Chamber of Commerce and Industry, held at Atlantis the Palm on November 9 and 10, 2016, is aimed exploring and identifying existing trade and investment opportunities in the region. More than 500 prominent stakeholders took part in the forum, including heads of state, policymakers, CEOs, business leaders, investors, and industry professionals, in addition to heads of private banks, sovereign wealth funds, and private equity firms.
