Things might be grim in much of the western world, but as Europe stumbles and the U.S. gradually recovers, it’s been a very different story in the Middle East. This region, noted for being one of the world’s most violent, if no the most violent, places is on the up economically.
According to research published by HSBC’s Global Connections Trade Forecast, the rate at which imports are growing to the region is expected to exceed that of exports – the opposite of what’s happening in the U.S., U.K. and other European countries.
The fact that there is an appetite for imported goods in the Mid East and other emerging countries like China, who is forecast to overtake the U.S. as the world’s largest importer by 2026, represents a huge opportunity for international businesses. Already, there has been an influx of expats to the Middle East and in particular the relatively attractive safe havens of the U.A.E., Qatar and Bahrain where there is economic growth and low taxes. These countries have extremely favourable taxation policies in comparison to developed economies like that of our own. Free trade zones galore and personal income does not attract tax in many of the emirates. Perhaps that would explain why multinational banks such as HSBC have been setting up offices and offering a plethora of business products like these targeting those in the import business.
So how can we in the West take advantage of what’s happening? Well, for a starter we cannot afford to sit back and watch it happen from afar. We need to be proactive, and get involved. Businesses that already export to established marketplaces in other developed countries need to think about how they can approach these emerging economies. Perhaps that means setting up a small office there. Maybe it means sending a member of staff to build sales, as so many companies have been doing over the past few years. Or you could take the most conservative approach and attend some trade shows and network.
With the world’s balance of economic power shifting, undeniably, now is the time to take action. Now is the time to get in there and start selling. Now all we need is for the government to grant businesses a tax repatriation holiday (Apple just raised billions of dollars in debt as that was a cheaper option compared to using their overseas cash) for businesses who do what everyone wants them to do – go and sell products and services overseas. But that’s a story for a different day.