From China’s Emergence to the need for Smart Cities, the Middle East is well placed to benefit from what the future holds, according to a number of experts who attended the region’s first SALT Conference, held recently in Abu Dhabi.
Their verdict chimes in with the remarks made by the UAE’s Minister of Cabinet Affairs and the Future Mohammed Al-Gergawi in his opening speech at Dubai’s Arab Strategy Forum earlier this month, where he spoke of
The possibility of a “bright future,” provided Arab states to take advantage of upcoming opportunities
“Our Region still has increasing strategic importance and possesses huge human potential,” said Al-Gergawi, who noted that more than 100 million Arab youth were predicted to enter the labour market over the next 10 years.
Parag Khanna, Managing Partner of FutureMap, a Data and Scenario based strategic global advisory firm, used the term “West Asia” to describe the Middle East while discussing the region’s prospects in the context of the Asian growth story.
“If this collection of countries in Asia, such as Pakistan and India, grow at just 5 percent, (they will have) a combined GDP equal to China’s present GDP in less than 10 years,” he said.
Among the key drivers of Asian financial growth and reform identified by Khanna are savings and consumption, local currency liquidity, capital-account liberalisation, and purchasing-power parity.
“Asia has been getting a lot of things right in economic and structural reforms. What Japan and South Korea have already done, and China is doing with its capital account, means a lot of countries want to do that too and manage their balance of payments. This copycat effect is going to continue to play out,” he added.
“We are currently living in a tripolar economic world, with North America, Europe and Asia standing as very important pillars today”.
The mobility of people and the growing mobility of capital are going hand in hand. In the last 15 years, China accelerated (the pace of) its outbound investments into infrastructure.
“The regions that have benefited the most from Chinese outbound investments are Europe, Africa, West Asia, East Asia and the Middle East and North Africa, namely Saudi Arabia, the UAE and Egypt,” said Khanna.
Referring to China’s One Belt One Road (OBOR) initiative, he pointed out that the trend it represented was irreversible, adding that the regions that belonged together in the “Silk Road” spirit were going to continue to reconnect no matter what.
Today, China is the UAE’s largest non-oil trading partner even as the UAE’s trade with Southeast and South Asia, particularly India, keeps growing.
“In terms of the geography of the UAE and Abu Dhabi, when historians talk about the ancient Silk Roads and the pre-colonial world, (we talk about) Afro-Eurasia,” Khanna added. “It captures Africa, Europe and Asia and the 16th-century world was Afro-Eurasia.
“What’s happening today is the resurrection of this Afro-Eurasian system. So, there couldn’t be a better time to be based in the UAE and looking multi-directionally into how to be a connector and a bridge between these three very important demographic and economic regions.”
In his remarks at the future-focused Arab Strategic Forum, Al-Gergawi had also posed the crucial question: In which direction are (Arab) countries heading?
The answer, strictly from the standpoint of urban development, is smart cities.
Conceptually, a smart city integrates information and communication technology and various physical devices connected to the Internet of Things (IoT) network to optimise the efficiency of different operations and services and connect to citizens.
In recent years, interest in smart cities has grown in tandem with technological, economic and environmental changes such as the shift toward online retail and entertainment, climate change, greying societies, urban population growth, and pressures on public finances.
With 60 percent of the global population or 5.5 billion people expected to live in cities by 2050, a gradual move over to smart cities is inevitable, according to Thomas Bardawil, Director at Plug and Play Smart Cities.