Davos 2025: Mubadala's Khaldoon Al Mubarak says new US economic strategy will spur growth

The new US administration’s economic policies will promote growth, the head of Abu Dhabi’s sovereign wealth fund has told the World Economic Forum in Switzerland.

Speaking in Davos, Khaldoon Al Mubarak, Mubadala’s managing director and chief executive, said that the US, where President Donald Trump has announced a swathe of measures to cut regulation, would lure in investors.

However, the head of the World Trade Organisation (WTO), Dr Ngozi Okonjo-Iweala, told delegates that a trade war “would not benefit anyone”, even though Mr Trump has spoken of imposing heavy tariffs on imports. In a session titled Finding Growth in Uncertain Times, Mr Al Mubarak said that when Mubadala looked for growth, its primary focus was on Asia and the United States.

“There’s a clear strategy that the US is embarking on – and that will spur growth in the US. And it will make it very attractive for investors,” he said. “Asia, I think continues to be a very important continent for growth.”

Mr Al Mubarak said that Mubadala and the UAE were committed to “heavy investment in the AI enablement space”. “We're looking at that, and that will spur growth in the UAE and, more importantly in this case, globally,” he said. “And the US will be a massive area for growth in [AI]. I expect the same in Asia and I expect us to follow these pathways.”

Børge Brende, a former Norwegian foreign minister and the World Economic Forum’s president and chief executive, said current global growth levels of around 3.3 per cent were “not bad”, but trailed the average over the previous three decades of close to four per cent.

For US growth it was important that Mr Trump’s plans for tax cuts and reductions in regulation were implemented quickly, according to David Rubenstein, co-founder and chairman of the private equity firm Carlyle. He too thought that Mr Trump’s regulatory changes would have a positive impact.

“He has a big agenda for changing regulations and other things that, I think, will spur economic growth,” Mr Rubenstein said.

Resolving conflicts is key

Conflict in the Middle East and Ukraine were key impediments to global growth, according to Mr Rubenstein, but if progress is made on these, economic growth is likely to “do quite well around the world”.

Dr Okonjo-Iweala warned, though, that there would be no winners if the introduction of tariffs sparked a trade war. She said “openness of markets” was key because “this has delivered for us”.

“I don’t want a tariff war. It will not benefit really anyone – the US or the rest of the world. It’s going to be inflationary,” she said. “In spite of all the challenges and the risks of protectionism, trade has been largely resilient. Eighty per cent of world goods trade is taking place under the WTO’s most-favoured nation status. This is a situation the world needs to preserve.”

She said that despite Mr Trump’s having signed a slew of executive orders in his first day in office, he had yet to impose any heavy tariffs with trading partners, so his actions so far were “encouraging”. Dr Okonjo-Iweala said several factors were necessary for global growth to increase, including macroeconomic stability and fiscal consolidation, as deficits were “getting quite high”.

Diversifying supply chains, something she said the European Union was promoting, would create jobs and reduce the need for people to migrate, she added.