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3/5/24, 10:12 AM Harnessing FDI for Driving Trade report launched during MC13 in Abu Dhabi | Emirates News Agency

Harnessing FDI for Driving Trade report launched during MC13 in Abu Dhabi
Wednesday, February 28, 2024 6:10 PM3 minutes Reading

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ABU DHABI, 28th February, 2024 (WAM) -- Dr Thani bin Ahmed Al Zeyoudi, UAE Minister of State for Foreign Trade, has launched a new report
on the importance of harnessing Foreign Direct Investment (FDI) to transform trade infrastructure and processes during the 13th Ministerial
Conference (MC13) of the World Trade Organisation (WTO) in Abu Dhabi.
Titled “Investing in Global Trade Growth: Harnessing FDI for Driving Trade”, the report reviews the challenges that countries, particularly
developing countries, face when seeking to build and maintain their trade infrastructure and proposes a framework to help them to address them.
According to the report, many of these challenges are financial, with funding gaps inhibiting investment in transportation networks, logistics and
warehousing facilities, customs and border-control functions and IT systems – all of which limit a nation’s private sector from participating fully in
global trade.
The report cites research by the World Economic Forum that suggests a 10% improvement in infrastructure quality can lead to a 1% increase in
GDP growth. Bringing down the costs of trade, and improving the transparency of trade processes, will also allow more SMEs, women-owned
businesses and youth-led firms to tap into global markets.
Foreign direct investment channelled towards trade infrastructure can play a vital role. However, this endeavour, particularly in emerging and
developing economies, comes with a myriad of challenges and risks, which deter investors. This includes financial risks such as corruption and
currency fluctuations, political instability, a cumbersome regulatory environment, under-developed technological ecosystems, and environmental
obstacles.
The report makes two major recommendations for governments looking to create the optimum environment for investment inflows. The first is a
Framework for Trade Infrastructure, which would focus on providing a risk-mitigation mechanism for trade infrastructure, offering political risk

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