Via Gulf News
By Suzanne Fenton, Staff Reporter
Dubai: Senior officials have said Dubai must focus more on capital-intensive business practices rather than depend on foreign labour in order to become more competitive in global markets.
Dubai was ranked 16th out of 65 global economies in the National Competitiveness Report for 2009 – the first time the emirate has featured in the eight-year-old report.
The report is published annually by the Institute for Industrial Policy Studies at Seoul National University.
Hani Al Hamli, secretary-general of the Dubai Economic Council, said that in a changing world, countries were competing in various sectors to benefit from globalised markets.
“From there arises the role of the Dubai Competitiveness Council & that aims to enhance Dubai’s competitiveness in global markets through enhancing local economic growth.
“This is achieved through developing sophisticated clusters which will make valuable contributions towards economic growth that will ultimately lead to propensity,” Al Hamli said.
Dubai was ranked ahead of Germany, Japan, France and New Zealand.
“Dubai has so far achieved great success due to its strengths. Dubai now has to turn its eyes to solving its weaknesses. With this new strategic direction & Dubai can turn this crisis into an opportunity for another take-off,” said Hwy-Chang Moon, professor of the graduate school of international studies at Seoul University, when he presented the report.
The report said Dubai’s strengths lay in the context of business, related industries and domestic demand. Its weaknesses, according to the report, included its workforce.
Al Hamli added that any strategy to take Dubai forward had to emphasise less dependence on workers.
To be less dependent on foreign labour, Dubai needs to focus more on capital-intensive rather than labour-intensive methods.
“For example, the construction industry is very labour-intensive if you use many workers, but it can be a highly capital-intensive industry if you approach it differently,” said Dong-Sung Cho, professor at the college of business administration at Seoul University.
Regional standing: Exports lead the way
Dubai exports remain by far the most competitive within the GCC, with 46 industries in Dubai considered competitive at a regional level.
The findings form part of a Revealed Comparative Advantage (RCA) index, the first in a series of research projects conducted by the Dubai Chamber of Commerce and Industry (DCCI). Dubai has the regional advantage in 11 export sectors relative to other Arab nations. Globally, Dubai exports are competitive in five sectors, with semi-precious to precious stones and metals and imitation jewellery holding first place on the index.
The index also showed that Dubai exports had competitive advantages in 23 industries relative to the global norm. “The indices are useful for measuring how Dubai’s total exports by sector and industry stack up against local or regional competition, and for identifying specific countries in which Dubai’s exports are competitive,” said Hamad Bu Amin, director-general of DCCI, at the chamber’s Economic Seminar on Sunday.
The DCCI has also begun research on another potential index which would measure the competitiveness of Dubai exports relative to specific competitors for specific destinations by sector, industry and product over time, according to the Azzeddine Azam, professor of economics at the University of Nebraska and visiting professor at DCCI.