Page 402 - Sustainable Cities and Communities Design Handbook

Business Ventures and Financial Sector Chapter j 19 375

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business (Doing Business 2011) ; 35th among 183 countries in the Index of
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Economic Freedom (2012) ; and 28th among 178 countries in transparency
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and accountability (Corruption Perceptions Index 2011). In addition, the
UAE is a contracting party to the General Agreement on Tariffs and Trade
(GATT) since 1994 and a member of the World Trade Organization (WTO)
since 1996. It is also a member of the Greater Arab Free-Trade Area in which
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all GCC states participate.
The country is committed to maintaining the policy of economic openness,
actively seeking to develop economic/business projects that are in harmony
with the changes taking place in the world. The improved credit and loan
provision as well as major public investment project expansion measures
contribute to building the country’s positive economic growth, despite the
current unfavorable economic environment.
To attract strategic foreign investments and to add value to the existing
business community as well as to provide a stable and attractive business
environment, the UAE government continues to launch initiatives and
incentives to boost its investment environment. Nevertheless, the volume of
investment might contract as a result of the restructuring of global businesses.
The UAE economy has been slowly recovering from the 2009 crisis and its
balance sheets have improved. The authorities strengthened the banking sector
through liquidity support, recapitalization, and deposit guarantees, and the
emirate of Abu Dhabi provided financial support to the emirate of Dubai.
The Dubai Financial Support Fund was called to support troubled entities in
the emirate and has now almost exhausted its funding of 20 billion USD. There
are several factors that might undermine economic recovery. They are the
following:

l Massive property projects and uncertainty regarding their size: The excess
supply of property in Dubai, which will further increase (as unfinished
projects come to completion), will continue to weigh on property prices
and growth prospects. Abu Dhabi’s strategy to increase its housing
supply may also pose risks by placing additional pressure on the property
market.
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l Government Related Entities (GREs) debt rescheduling:According to
the International Monetary Fund, GREs have an estimated 32 billion USD
of debt due in 2011e12 (of which at least 5 billion USD is in the real

4. http://www.ukiet:doingbusiness.org/rankings.
5. http://www.heritage.org/index/ranking.
6. http://cpi.transparency.org/cpi2011/results/.
7. http://www.polishbusinessgroupuae.com/page.aspx?l¼1&pg¼8&md¼pagedetail.
8. Government Related Entities.