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Private equity poised as UAE relaxes restrictions
As the UAE opens up to foreign ownership, an expert panel convenes at our Dubai campus to consider private equity’s role in the region
The United Arab Emirates has seen enormous change. Oil wealth has transformed the desert into a landscape of resorts, skyscrapers and green neighbourhoods.
As it has grown it has diversified into tourism, financial services and technology, retail and luxury goods. Dubai, where London Business School (LBS) runs a campus has positioned itself as a regional magnet for talent. All ingredients are there for the next stage of its economic growth in the Middle East.
Earlier this year, the UAE government said it would support more foreign investment, when it allowed 100% foreign ownership of firms in more than a 100 different economic activities across 13 sectors including renewable energy, agriculture, e-commerce and manufacturing.
As part of our 2019 Worldwide Alumni Celebration event, an expert panel was welcomed to our Dubai campus by Evie Boustantzi (EMBADJ2013), General Manager at b.fm, a facilities services company, and President of the LBS Alumni Gulf Association. The panel was chaired by Florin Vasvari, LBS Professor of Accounting, Chair of Accounting faculty and Academic Director of the Private Equity Institute.
Panellist Sheikh Maktoum Hasher Maktoum Al Maktoum, Chairman of Risk and Board Member at Commercial Bank of Dubai and Chairman of Artemis Resources, began the discussion saying that the driving force behind Dubai's rise has been its vision for infrastructure and ease of doing business.
Sheikh Maktoum described a gradual opening up process taking place within the economy and explained why the economy was in parts still restricted to some Emirati ownership.
"Stability is good for business," he explained. "And one part of stability is the distribution of wealth. The fact that the UAE government restricts foreign ownership has meant we have kept more wealth among the local population."
He argued the UAE had fared better compared to many other resource rich nations who had wasted opportunities for short-term cash.
"Would you interpret these relaxed foreign ownership rules as being a sign that there's no need for restrictions on foreign owners anymore?" probed Professor Vasvari.
