Offset Study, Innovative Financing for Global Health
Established in 1998, UOG is controlled by the governments of Abu Dhabi and Dubai. The group is in charge of channelling defence-related investments into profitable projects in various sectors to help diversify the UAE economy. The funds emanate from the offset investment programme of the federal defence ministry, a programme which requires foreign defence suppliers to invest locally an important part of their UAE orders.
UOG identifies to projects in which offset investments are to be placed by the foreign suppliers in partnership with local investors. Several huge defence companies have set up offices in Abu Dhabi to launch offset projects identified by UOG. These include Aerospatiale and Giat of France (which has a $3.75 bn tank deal), aircraft giant CASA of Spain and Newport Shipbuilding of the US.
CASA is involved in a tile and bricks project in the Mussaffah industrial zone. Giat is participating in a range of ventures, and may take a share in the Emirates General Petroleum Corp. (EGPC) when it is privatised. UOG resulted from the integration of Dubai’s armed forces into the federal General Headquarters of Abu Dhabi in 1997, which led to increased co-operation between the two emirates.
In February 1998, the governments of Dubai (DNOC) and Abu Dhabi (ADNOC) signed a final agreement on the supply of Khuff gas to Dubai’s Jebel Ali free zone (see Gas Market Trends No. 3). In December 1998 it reported that a new joint stock company to be based in Abu Dhabi city as part of UOG would develop gas in Qatar’s North Field and supply it to Abu Dhabi and would have a marine pipeline built for the purpose. It was said that other UOG related firms would be set up to market the gas in Abu Dhabi and build distribution pipelines, with international engineering companies likely to be included as partners. It was also said that the project’s technical and marketing studies have been completed by “Intec Engineering and Paragon of the US”.
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