ONE of the most striking phrases in David Cameron’s recent speech on Europe was his recognition “that a new global race of nations is underway today”. Adapting to a fast-changing global economic order is critical to the continued prosperity of the UK. Over the past decade, a huge amount of focus has – quite rightly – been placed on strengthening the UK’s ties with the Bric nations, as we strive to realign our patterns of trade to reflect the reality of these fast-growing markets.
But no less important have been ongoing efforts to foster closer two-way partnerships across the Gulf. The government views this region as a priority, and it is important that UK firms follow this lead to fully explore the opportunities available in the face of intense competition from our rivals.
Relationships are key to developing business in this global race. That is why building on the work of previous City delegations is an important element of what we do. A delegation will travel to the region – to Kuwait, the UAE, Egypt, Bahrain and Qatar – later this week, following on from a recent visit to Oman.
There is a huge amount of goodwill towards the UK due to our historic ties. This is reflected in the fact that the Gulf accounted for over £17bn of total exports in 2011, making it the UK’s seventh largest export market, and a bigger one than India, Russia and Mexico combined.
But there is scope to broaden and deepen this relationship. A case in point is the huge range of opportunities available in regional infrastructure investment.
Currently, 15 of UK Trade and Investment’s 56 High Value Opportunities are in the Gulf. Qatar is forecasting up to $200bn (£126.6bn) of infrastructure expenditure in preparation for the 2022 World Cup, Kuwait’s National Development Plan contains $108bn for infrastructure development and Oman has a $20bn programme of infrastructure development, encompassing roads, rail, ports and airports.
In order to win a share of this business, however, we need to demonstrate why UK firms should be seen as the region’s commercial partner of choice. The key differentiator for the UK is our hard-won reputation for delivering major high-quality projects on time and on budget – as demonstrated memorably by the 2012 Olympics. The City has vast experience in mobilising the capital and providing the services required throughout a project’s lifecycle – from design to delivery.
In addition to infrastructure, there is a growing demand across the Gulf for knowledge-intensive services in which the UK excels. These include education, research and healthcare, as economies diversify away from petrochemicals.
From the City’s perspective, we believe that sharing skills and experiences will ensure this longstanding relationship continues to go from strength to strength. But in this global race, we cannot afford to underestimate the hunger of our competition.
Roger Gifford is lord mayor of the City of London.