Air Liquide S.A. is reportedly aiming to increase its total investment in the Gulf region to $1bn from $200m at present, according to Chief Executive Benoit Potier when speaking at the opening ceremony of the French industrial gases group’s regional office for the Middle East.
The world’s largest industrial gas supplier noted that it plans to increase its investments in the Middle East to develop more production capacity closer to the region’s cheaper energy products.
“This region [the Middle East] will be very important,” said Air Liquide CEO Benoit Potier in Dubai recently, according to Bloomberg.
“Energy is cheap and feedstock is available,” Potier said at the opening ceremony of the French industrial gases group’s regional office for the Middle East.
Air Liquide is certainly not alone in its interest in expanding production in the Middle East. Mohamed al-Mady, the CEO of Saudi Basic Industries Corp. (SABIC) told Reuters that petrochemicals producers in the Middle East are among the primary benefactors of the region’s access to low-cost energy, especially in light of an expected demand surge from Asian markets for chemicals.
Output from the Middle East will apparently account for 17% of global output by the end of 2010, compared with 10% at the beginning of 2000.
At the same time as a flock of investment in the region, the UAE’s real economic growth rate – which excludes the direct impact of changes in oil prices – is among the highest in the world, a new report has revealed. The country has achieved a compound annual growth rate (CAGR) of 9.3% in the past five years, says the study by Global Research, part of Kuwait’s Global Investment House.
Oil is likely to continue to play a crucial role in the UAE’s growth. However, non-oil GDP is likely to dominate overall growth in real and nominal terms, with the private sector playing a bigger role in the future.
“Going forward, the government’s main challenges include pushing ahead with diversification into more labour-intensive activities and leveraging the emirate’s strong hydrocarbon sector to stimulate and support broader economic growth,” adds the report.
The economy posted its fifth consecutive year of strong economic growth and is expected to show healthy growth in 2008 as well on back of high oil prices, strong regional liquidity and the infrastructure and construction developments that are well underway.