Arab capital migrating from the US and European portfolios, mutual funds and unit trusts are seeking suitable investment opportunities in the UAE, Dubai in particular, following last year's terrorist attacks in the USA, said Juma Fahad Al Juma, a prominent Saudi businessman. Al Juma, visiting Dubai to establish an office here, said it is not easy to find safer investment areas in the Arab world due to the absence of functional mutual funds and advanced unit trust that invest money in domestic markets. "Dubai has to remove every possible hurdle that delays the investments of migrating Arab capitals by speeding up the procedures of establishing its International Financial Centre."
"Huge funds held by Saudi businessmen and traders are poised for investment in the UAE because it has a very strong base to evolve into a future capital market. "The move to establish an international financial market following the setting up of the Dubai and Abu Dhabi stock markets are positive indications that tempt us to channel our money into this market safeguarded by government laws and regulations." He pointed out that Saudi businessmen have been the major investors in several mutual funds in the West, especially those in the IT technology and telecommunications. "The amount of money invested in the US in the last two decades by the Saudi businessmen is ten times the capital invested by them in Saudi Arabia," said Juma.
"The absence of advanced capitals apparatus and regulated mutual funds in the Arab world is the main reason why businessmen from Arab world favoured to go overseas to keep their capital in the West for it has very strong financial institutions," explained Al Juma. "These institutions operate in a very systematic manner under strict regulations, a factor that is missing in the Arab world." Arab countries also lag behind in terms of advanced infrastructure, said Al Juma.
He said Arab capitalists and businessmen seeking investment opportunities are also concerned with the political stability in their own countries. "One of the outcomes of the September 11 is that some of the Arab banking and financial institutions have come with good ideas to establish highly advanced capital funds apparatus to attract migrated capital in Bahrain and Saudi Arabia and in Dubai. Many investors, especially those with very huge sums, prefer mutual funds much more than any other productive and industrial projects which need a lots of operating capital and close monitoring by the owners. (The Khaleej Times)
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