Senior finance executives in the Middle East upbeat despite uncertainty

In Saudi Arabia, 71 percent of finance executives expected strong or modest growth this year. (Reuters)
Updated 19 June 2019

Senior finance executives in the Middle East upbeat despite uncertainty

  • Some 72 percent of those polled regionally thought they would see economic growth this year
  • The report also highlighted the core importance of next-generation technology and innovation on corporate dynamics

DUBAI: Senior finance executives in the Middle East are less optimistic about the prospects for economic growth than they were 12 months ago, but remain positive on the outlook for their companies and investments.
That was the main finding for the region of an international poll conducted for American Express, the global financial services firm, by Institutional Investor, the business information group, and presented to media and corporate clients in Dubai yesterday.
Mazin Khoury, chief executive officer for American Express in the Middle East, said financial executives were “operating in unsettled times.” Despite this, “they are concentrating on their day-to-day business but keeping an eye on the future,” he added.
Some 72 percent of those polled regionally thought they would see economic growth this year, compared with 92 percent last year, in part due to oil price fluctuations. Only 10 percent said there would be a significant contraction in growth.
In Saudi Arabia, 71 percent of finance executives expected strong or modest growth this year, roughly the same as in the UAE. Amex noted that “despite oil prices rising in early 2019, long-term global trends point to more supply and less demand.”
The poll was taken late last year, before even greater recent volatility in the global oil markets, as well as worries about global trade and faltering economic growth.
A majority of them — some 64 percent — thought that “socio-economic changes and global trade policy” would strengthen their companies’ growth prospects, with only 5 percent expecting these factors would weaken their outlook. That was broadly in keeping with global averages, Amex said.
“Expanded foreign trade will be based more on organic strategies than partnerships, the executives through, with most companies likely to set up or expand foreign operations and use online media for marketing to pursue international growth strategies,” in a sign of a more nimble approach to foreign trade in the Middle East.
The report also highlighted the core importance of next-generation technology and innovation on corporate dynamics, as well as the importance of young people under the age of 24, as both customers and employees.
Some 78 percent of respondents said they had explicit strategies to appeal to “Generation Z” consumers, who make up between 50 and 64 percent of regional populations.
The report did not include data relating to consumer spending by Amex customers. Khoury said that his business had not seen any impact from recent negative trends in economics or geopolitical factors.
“If it happens it will not affect American Express alone, but there has been no impact. It is too early to judge,” he said, referring to increased tensions in the Arabian Gulf region.
“Our customers are still calling us to book their travel, we are still engaging with corporates
and signing new corporates. They are continuing to spend,” he told Arab News.

Davos 2020: Ministers, top executives in Saudi delegation to WEF

Klaus Schwab, founder and executive chairman of the World Economic Forum, center, his wife Hilde, left, and President of the European Commission Ursula von der Leyen are seated during the opening session of the 50th annual meeting of the World Economic Forum, in Davos, Switzerland, Monday, Jan. 20, 2020. (AP)
Updated 5 min 29 sec ago

Davos 2020: Ministers, top executives in Saudi delegation to WEF

  • A large KSA contingent comprising 55 senior figures will be attending the WEF in Davos
  • Around 3,000 leaders from business, public policy, culture and technology will be in attendance

DAVOS: Some 3,000 leaders from the worlds of business, public policy, culture and technology are due to arrive in the Alpine town of Davos for the annual meeting of the World Economic Forum (WEF), which begins on Tuesday.

The meeting this year — under the theme “stakeholders for a cohesive and sustainable world” — is the 50th time the annual meeting has been held in the Swiss resort, but it comes at a time of growing global tensions over climate change and geopolitical confrontation.

Last week, the WEF published its annual global risk report, one of the gloomiest ever, with global experts concerned about accelerating environmental damage and potential political flashpoints in several parts of the world.

Saudi Arabia is sending a top-level delegation to the meeting, headed by Dr. Ibrahim bin Abdulaziz Al-Assaf, Minister of State and Member of the Cabinet, with some 55 senior figures.

They include ministers and senior executives from industry, finance and the economy, in addition to many other Saudi participants attending for bilateral meetings and support roles, as well as the event’s legendary networking.

Prince Abdulaziz bin Salman will attend his first WEF annual meeting since he was named energy minister last year. Deputy Defense Minister Prince Khalid bin Salman will also attend.

Amin Nasser, CEO of Saudi Aramco, will attend for the first time as head of a publicly listed company following the oil giant’s successful initial public offering (IPO) last year.

Relations between Saudi Arabia and the WEF have grown stronger as the Kingdom’s ambitious Vision 2030 strategy has accelerated.

Later this year, Riyadh will play host to a meeting of the WEF under the banner of the Centre for the Fourth Industrial Revolution, the brainchild of Klaus Schwab, WEF founder and executive chairman.

“On the eve of its G20 presidency, we welcome the Kingdom of Saudi Arabia … to shape those technologies in a way that serves society,” Schwab said.

In contrast with the strong participation from Saudi Arabia and other Gulf countries, notably the UAE, Iran has pulled out of the meeting altogether because of the heightened political tensions in the region following the killing of the country’s top general, Qassem Soleimani, in a US strike earlier this month.

President Donald Trump is leading a big American delegation to the event, the second time he has attended Davos since moving into the White House, having missed last year. He is due to deliver a keynote address on the opening day of the meeting.

Climate change and its consequences look certain to be a big topic in snowy Davos, where the temperature rarely rises above freezing.

Greta Thunberg, the young environmental campaigner, is also taking part in sessions, including one on “averting a climate apocalypse.”

She has hiked over the Alps to get to Davos, having pledged not to use environmentally damaging public transport.

Davos 2020 is split across seven key themes: Healthy futures, how to save the planet, better business, beyond geopolitics, technology for good, fairer economies, and society and the future of work.

On climate change, the WEF said: “The Earth is getting hotter, the ice is melting, the oceans are rising, and they’re filling up with plastic. We’re losing species, building up greenhouse gases, and running out of time. It’s easy to feel downhearted.”

On rising geopolitical tensions, it added: “We need to move from geopolitics and international competition to a default of consummate global collaboration. Nations are going to have to change.”

In an effort to change the event’s image as a showy gathering of the global elite, often traveling in helicopters and limousines to the Alpine resort, the WEF has offered to pay half of the first-class rail fare from anywhere in the world to Davos.