Decision makers in the Gulf Arab countries began to feel the increasing effects on their economies as the British begin their 1 year countdown to formally withdraw from the EU.
According to a study by Cambridge Econometrics, Britain could in a worst-case scenario lose a total of 482,000 jobs by 2030 due to Brexit.
Richard Branson, British media and airline tycoon stated fears that Britain’s withdrawal from the EU could mean a disaster for his country.
British firm’s scores have already declined, even ended business in the Gulf States due to the vague economic view of Britain after withdrawing from the EU.
Britain’s General Trust and Daily Mail in December 2016 ceased the 14 year publication of the free tabloid daily “7Days” in Abu Dhabi and Dubai.
Killik&Co, British investment and financial consultancy firm on Feb. 2017 ended its 10 year existence in the Gulf, closing down its only foreign office in the banking free zone Dubai International Financial Center.
It was not the only British firm that recently withdrew from the region. Balfour Beatty, Britain’s biggest construction and infrastructure investment in Feb. 2017 announced it was going to sell its entire Middle East business to its UAE’s joint venture partner Dutco.
Carillion, Britain’s second major construction service firm equally made headlines on 15th Jan. when it entered compulsory liquidation due to its massive bank debts.
Craig Plumb, head of research for North Africa and Middle East at the real estate advisory firm JLL in Dubai said that the sluggish British Pound coupled with reduced investment from British institutional and individual investors also had an adverse effect on the Gulf States’ property market.
Plumb added that however, nothing changes for about 100,000 British citizens residing in the UAE, as their salaries are not exposed to the risk of currency exchange, hence they are not affected by reduced purchasing power when buying property in the UAE.
Even before the Brexit vote, other Gulf Arab companies withdrew from London, as Bahrain’s biggest Islamic financial institution Gulf Finance House in 2015 delisted from the LSE.
However, the undersecretary of the UAE’s Ministry of Economy for Foreign Trade Affairs, Abdullah Bin Ahmed Al Saleh said that the UAE was keen to increase two-way trade with Britain and their existing partners in Europe, plus with their new partners in Latin America, Africa and elsewhere.
According to Britain’s Department of International Trade, the UAE is Britain’s largest importer in the Middle East.