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Sun 13 Sep 2015 12:05 PM

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China ‘still key to Dubai’s growth’, says DIFC chief

Essa Kazim pledges ongoing confidence in Chinese economy during visit this week

China ‘still key to Dubai’s growth’, says DIFC chief

Dubai International Financial Centre (DIFC) will continue targeting China for future growth despite its economic meltdown last month, its governor Essa Kazim has said.

A team of DIFC officials visited Beijing and Shanghai last week to detail the free zone’s plans to triple in size by 2024.

China, the DIFC said in July when announcing its ten-year expansion strategy, is a key target market in plans to increase assets under management from $10.4 billion to $250 billion, grow its balance sheet from $65 billion to $400 billion and hike up total number of financial companies operating within the free zone from 382 to 1,000.

The China stockmarket crash in August could have threatened to put the DIFC’s plans off course – but DIFC deputy CEO Arif Amiri insisted at the time that it was “business as usual as far as our value proposition to China is concerned.”

“We are undeterred by market fluctuations,” he added.

Speaking to prospective Chinese investors in Beijing on Saturday, governor Kazim declared a further vote of confidence in the Chinese economy.

“China is rich in opportunity and optimism,” he said. “Seven per cent growth of a $10 trillion economy is still more than three times the growth experienced by the United States and 5 times that of India in absolute terms.

“DIFC’s 10-year strategy is providing new avenues for Chinese trade and investment flows, aligning with the country’s efforts to diversify and source new consumers for its economic production.”

In particular, Kazim pledged to support the Chinese One Belt, One Road (Obor) project, a trading initiative to encompass East and South Asia, the Middle East and Africa, which is also a key plank of the DIFC’s 10-year strategy.

“The DIFC’s position at the heart of a vast economic region with an estimated combined GDP of $7.9 trillion will help China catalyse the Obor trade and investment initiative,” he said.

As much as half of DIFC’s expansion will be driven by increased economic activity in the ‘South South’ economic corridor (encompassing Asia, Middle East, Africa, and Latin America), the DIFC announced in July, with the rest generated by existing DIFC clients, continued improvement of services and extension into global markets.

Asian financial firms make up 11 percent of the total financial firms operating in the DIFC at present, it said, including China’s four largest banks representing more than half of the country’s banking sector in terms of balance sheet size.

The Management Offices of PetroChina, CPF Limited and ZTE Corporation make up the rest of the seven Chinese firms based at DIFC.

Chinese nationals account for 10 percent of Dubai’s expat population – around 200,000 people, the DIFC added.