DHL Global Connectedness Index: United Arab Emirates becomes world’s fifth most connected country as globalization hits record high

February 14, 2019 - 10:20
DHL Global Connectedness Index: United Arab Emirates becomes world’s fifth most connected country as globalization hits record high

  • The UAE rose five places on the Index to rankfifth in the world after The Netherlands, Singapore, Switzerland and Belgium
  • The Middle East and North Africa is world'sthird most globally-connected region after Europe and North America

 

DUBAI, UAE - Media OutReach - February14, 2019 - DHL has releasedthe fifth edition of the DHL Global Connectedness Index (GCI) -- a detailedanalysis of globalization, measured by international flows of trade, capital,information and people.

 

The latest edition of the GCI saw the United ArabEmirates (UAE) surge to fifth place in the world for global connectedness. Thecountry's rank stood at 18th in 2004. It entered the top 10 in 2012 (ranking 9th),and continued rising all the way to its present 5th position, a record rank forthe country and the highest rank achieved yet by a country from the Middle Eastand North Africa region. The UAE has proactively supported connectedness by,for example, fostering vibrant activity in free trade zones such as the AbuDhabi Airports Free Zone (ADAFZ) that focus on non-oil products as part of thegovernment's economic diversification strategy. Israel, Bahrain, Mauritius,Qatar, Saudi Arabia, Seychelles and Lebanon all made it into the Index's Top 50,while Sub-Saharan African countries like Nigeria, Sierra Leone and Guinea onthe West African coastline showed remarkable improvements in connectivity.

 

The 2018 index measures the current state ofglobalization, as well as individual rankings for each country, based on thedepth (intensity of international flows) and breadth (geographical distributionof flows) of countries' international connections. The world's top five mostglobally connected countries in 2017 were the Netherlands, Singapore,Switzerland, Belgium and the United Arab Emirates. Middle East and North Africais the world's third-most connected region, behind Europe and North America.

 

"While oil exports continue to underpin the Emirates'connectedness to the global economy, the establishment of free trade zones likethe ADAFZ has attracted businesses worldwide, serving as a strategic hub andgateway to Abu Dhabi, the UAE and the wider region,[1]"said Nour Suliman, CEO Middle East and North Africa, DHL Express. "Increasedtrade from companies based in these zones have directly contributed to the risein the UAE's non-oil foreign trade in sectors like aviation, pharmaceuticals,technology and e-commerce, accounting for 62% of total trade.[2]Over the past few years, deals with key partners like Saudi Arabia have reachedUS$10 billion,[3]while UAE-India trade partnerships are expected to cross US$100 billion by2020.[4]"

 

"The region continues to face geopoliticalheadwinds as well as issues around quality and reliability of infrastructure, butthings are changing thanks to new policies and investments from government andindustry alike. DHL Express recently opened a US$5.8 million logistics facilityin Jordan as part of the company's commitment to invest US$170 million ininfrastructure developments across Middle East and Africa[5]as we continue to drive greater regional and global connectedness withinnovative, high-quality end-to-end logistics services."

 

The new GCI report represents the firstcomprehensive assessment of developments in globalization across 169 countriesand territories since the Brexit referendum in the United Kingdom and the 2016presidential election in the United States. In spite of growinganti-globalization tensions in many countries, connectedness reached anall-time high in 2017, as the flows of trade, capital, information and peopleacross national borders all intensified significantly for the first time since2007. Strong economic growth boosted international flows while key policychanges such as US tariff increases had not yet been implemented.

 

A central theme of research by GCI co-authorsSteven A. Altman and Pankaj Ghemawat is that at the global level, the world isstill less connected than most people think it is, even after globalization'srecent gains. For example, just about 20% of economic output around the worldis exported, roughly 7% of phone call minutes (including calls over theinternet) are international, and only 3% of people live outside the countrieswhere they were born. The report also debunks the belief that distance isbecoming irrelevant. Most countries are much more connected to their neighborsthan to distant nations.

 

Emergingeconomies remain less connected than advanced economies

 

The GCI continues to reveal vast differencesbetween levels of globalization in advanced versus emerging economies. Emergingeconomies trade almost as intensively as advanced economies, but advancedeconomies are more than three times as deeply integrated into internationalcapital flows, five times for people flows, and almost nine times with respectto information flows. Additionally, while leaders from large emerging marketshave become major supporters of globalization on the world stage, emergingeconomies' progress in terms of global connectedness has stalled.

 

Note toeditors:

The report was commissioned by DHL and authoredby Steven A. Altman, Pankaj Ghemawat, and Phillip Bastian of the New YorkUniversity Stern School of Business and the IESE Business School. The 2018 DHLGlobal Connectedness Index draws on more than 3 million data points frominternational flows covering trade, capital, information and people. Itdocuments and dissects levels of globalization, both at the global level andfor 169 countries and territories that jointly account for 99% of the world'sGDP and 97% of its population.

 

The report and additional background informationcan be downloaded at logistics.dhl/gci.

 

DHL -- The logistics company for the world

 

DHL is the leading global brand in the logistics industry. Our DHL familyof divisions offers an unrivalled portfolio of logistics services ranging fromnational and international parcel delivery, e-commerce shipping and fulfillmentsolutions, international express, road, air and ocean transport to industrialsupply chain management. With about 360,000 employees in more than 220countries and territories worldwide, DHL connects people and businesses securelyand reliably, enabling global trade flows. With specialized solutions forgrowth markets and industries, including technology, life sciences andhealthcare, energy, automotive and retail, a proven commitment to corporateresponsibility and an unrivalled presence in developing markets, DHL isdecisively positioned as "The logistics company for the world."

 

DHL ispart of Deutsche Post DHL Group. The Group generated revenues of more than 60billion euros in 2017.


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