Country United Arab Eremites (UAE)

Scenario:

OSRAM is a multinational lighting manufacturer headquartered in Munich, Germany. Your firm has been asked by OSRAM about the prospect of adding a new manufacturing facility in the UAE for its latest innovation in OLED light bulbs for the automotive industry. OSRAM has made significant investments in R&D with regards to the OLED technology and success in this business line is strategically important to the firm.

Provide the following analysis of the UAE :

1. An analysis of the macroeconomic conditions surrounding that country and its currency.
2. An analysis of whether the country's currency is currently overvalued, undervalued, or fairly valued relative to the U.S. dollar and/or Euro.

• predict the value of the currency one year from today, three years from today, and five years from today
• provide guidance on how the firm could mitigate the impact of currency movements, should these issues arise (i.e., how should the firm approach transaction, translation, and/or operating exposure in the UAE?).