Small businesses in the Middle East pay big price for pandemic protection measures

A worker sanitises a table for clients at a cafe in Saudi Arabia's capital Riyadh on June 21, 2020, as the country begins to re-open following the lifting of a COVID-19 lockdown. (AFP/File Photo)
A worker sanitises a table for clients at a cafe in Saudi Arabia's capital Riyadh on June 21, 2020, as the country begins to re-open following the lifting of a COVID-19 lockdown. (AFP/File Photo)
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Updated 15 May 2021

Small businesses in the Middle East pay big price for pandemic protection measures

A worker sanitises a table for clients at a cafe in Saudi Arabia's capital Riyadh on June 21, 2020, as the country begins to re-open following the lifting of a COVID-19 lockdown. (AFP/File Photo)
  • Small, medium-sized enterprises have spent a fortune on cleaning, testing and PPE while absorbing the cost of lost custom
  • Lockdowns and social distancing rules have forced companies to adopt digital tools to ensure their long-term survival 

DUBAI: Staying in business through the COVID-19 pandemic has not been cheap for retailers, hoteliers or eateries — to name just a few types of small- and medium-sized enterprises (SMEs). All over the world,  including the Arab region, SMEs have suffered the double whammy of lost custom combined with new expenditure on cleaning, testing, protective equipment and hand sanitizers.

Companies have spent hundreds of thousands of dollars on hygiene protocols in a desperate bid to keep their doors open. Contact-intensive sectors such as leisure, hospitality and tourism have suffered more than most. Airlines, spas, gyms and galleries have all been forced to limit footfall.

Although the rollout of vaccines has raised hopes of a turnaround this year, with people itching to book summer getaways and nights out on the town after months stuck indoors, a mixture of new virus mutations and the uneven distribution of vaccines means the world is still a long way from returning to normal.

According to an April report by the Organization for Economic Co-operation and Development (OECD), which assessed the impact of the pandemic on SMEs over the past year, such firms have been hit far harder than their larger counterparts.

“SMEs are overrepresented in the sectors most affected by the crisis, in particular in wholesale and retail trade, air transport, accommodation and food services, real estate, professional services, and other personal services,” the report said.

“Smaller firms are typically more financially fragile and have smaller cash buffers than their larger counterparts. This makes them less resilient to crises.”

Small companies also tend to have weaker supply chains and can “lag behind in terms of the uptake of digital tools and technologies which can help to build resilience in the current pandemic crisis.”




People walk past a closed restaurant in the Saudi capital Riyadh, on February 5, 2021, after new rules laid out by the Ministry of Interior to curb a recent spike in COVID-19 cases. (AFP/File Photo)

Crucially, it would seem, SMEs are also “less likely to have managerial capability to comply with new regulatory frameworks to guarantee customers’ and employees’ safety.”

For Tala Badri, founder and executive director of the Center for Musical Arts in Dubai, most of the past year’s excess expenditure has been spent on COVID-19 safety and hygiene measures for her patrons and staff.

When businesses in Dubai were cleared to reopen in the second half of 2020, under strict public health guidelines, Badri was legally obliged to hire an approved cleaning company to sanitize the entire premises, its equipment and its musical instruments.

“We have to set up systems where you have a sanitization station everywhere that is accessible,” Badri told Arab News. “You have to buy the sanitizer. These are all additional expenses that we never had to face before.

“We also have to put up special screens for teaching, which cost AED 2,000 to AED 3,000 ($545 to $820) and are just plastic screens, not even that big, but they cost money,” she said.

“One of the other things we have to do is increase our Internet usage (for remote teaching). You have (limited) choice (in selecting an Internet service provider). You have just to go with whatever is there. We are paying on average about AED 15,000 ($4,000) per term, and this is like someone’s salary. It is like having another person on staff.”




Saudi authorities in February suspended the provision of indoor dining service, allowing only take-away, and banned all recreational and entertainments activities for 10 days to stem the spread of COVID-19. (AFP/File Photo)

Badri “totally accepts” the measures are necessary, but says they constitute an “unprecedented extra cost” that businesses like hers were in no position to take on. “When you are losing such a huge amount of your money, and you have to pay extra to stay in business, where there is no support, it is very difficult,” she said.

Other sectors have been forced to absorb cumbersome expenses of their own. Gyms, for instance, have replaced communal soap dispensers with individually wrapped bottles to reduce surface contamination.

Although many fitness facilities are saving on their laundry bill by asking guests to bring their own towels, round-the-clock sanitizing of equipment and surfaces is nevertheless eating into their budget.

Restaurants have also had to radically rethink their business model, relying on local delivery firms to reach a smaller catchment of customers and absorbing the additional cost of single-use takeaway packaging, not to mention the outgoings on additional health and safety measures in the kitchen.

Those eateries with sufficient space have experimented with partitioning and spreading out their customers, but the loss of larger bookings and walk-ins will no doubt have hit their balance sheets.




Employees of a restaurant at a mall in the Saudi capital Riyadh wear face masks after the authorities eased some of the restrictive measures put in place to combat the spread of COVID-19. (AFP/File Photo)

On top of this, extra signage, QR-code menus, queuing areas, plexiglass screens, sanitizing stations, plastic tablecloths and cashless payment systems have not only multiplied expenses but also taken away some of the magic of the dining-out experience. Who enjoys wearing their mask between courses?

No wonder supermarkets and other food-retail outlets have seen a bounce at the expense of restaurateurs since the pandemic began. According to Somaia Basha, a Dubai-based senior research analyst for Euromonitor International, Saudi Arabia’s restaurant sector lost 37 percent of its value in 2020.

“Because of the initial lockdown, we have seen overspending on food retail. On the other hand, of course, restaurants were massively hit,” she told Arab News.

SMEs have been forced to adapt quickly to new trends, which, although they existed prior to the pandemic, have been pushed into overdrive out of necessity. Take, for instance, the digital transformation of home delivery and payment methods.

“COVID-19 has elevated or increased the speed of a lot of trends that were actually already happening,” said Basha. “So, before COVID-19, there was transformation of payments, there were delivery options that were getting traction. But after COVID-19, these became more important.

“Progress that we expected to take years has been happening over the course of one year in some countries and even just a matter of months in others. This high speed is transforming many industries.




People sit at a cafe in a mall in the Saudi capital Riyadh on June 4, 2020, after it reopened following the easing of some restrictions. (AFP/File Photo)

“Now, imagine you are one of these restaurants and suddenly you are faced with this issue of either going digital or shutting down. You are going to have to invest money when you are already making a loss, because you are not generating any revenue, and you are not there on delivery platforms.

“So, you are now going to spend a couple of thousand dollars to be there, to be available in the digital world. And then, when you go into the digital world, you will find you have multiple platforms, which are competing, and you have prices dropping.”

Perhaps, then, the innovations that this pandemic has driven forward, with companies forced to invest and adapt to ensure their long-term survival, are the real silver lining of this traumatic and costly year. True, not all sectors can benefit from digital technologies, but those that do can expect to bounce back much faster.

“It is a challenging time for restaurants all over the world. They are playing in an area they have not maneuvered in before,” said Basha. “It is unknown territory.”

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Twitter: @jumanaaltamimi


Iraq arrests two generals on suspicion of bribery at key port

Iraq arrests two generals on suspicion of bribery at key port
Updated 12 June 2021

Iraq arrests two generals on suspicion of bribery at key port

Iraq arrests two generals on suspicion of bribery at key port
  • In Iraq, every port and border crossing has its corrupt placemen appointed by political parties or armed groups
  • In Umm Qasr, it is mainly pro-Iranian armed groups who dominate through their nominees in the customs department and the security forces, officials say

BAGHDAD: Iraq announced Saturday it has arrested two generals on suspicion of taking bribes to waive customs duties, a practice estimated to cost the state $6.3 billion a year in lost revenues.
Both men worked at the Gulf port of Umm Qasr, a key entry point for imports of foodstuffs and medicines which is reputed to be the most corrupt in Iraq.
The sums allegedly found in their position were tiny given the scale of corruption in Iraq, which is estimated to have cost the country hundreds of billions of dollars since the US-led invasion of 2003.
"$1,000 were found in the office of the general in charge of Umm Qasr North, while the other general had hidden $2,100 in a waste basket in his office," a source in the state anti-corruption body, the Commission for Integrity, told AFP.
"These were bribes intended to facilitate the smooth passage of cargos," the source said.
In Iraq, every port and border crossing has its corrupt placemen appointed by political parties or armed groups, who ensure a steady flow of illicit revenues to their patrons.
In Umm Qasr, it is mainly pro-Iranian armed groups who dominate through their nominees in the customs department and the security forces, officials say.


Algeria votes for new parliament for first time since Bouteflika’s exit

Algeria votes for new parliament for first time since Bouteflika’s exit
Updated 12 June 2021

Algeria votes for new parliament for first time since Bouteflika’s exit

Algeria votes for new parliament for first time since Bouteflika’s exit

ALGIERS: Polling stations opened Saturday in Algeria's first parliamentary election since a popular uprising forced longtime autocratic president Abdelaziz Bouteflika from office in 2019.

The vote is meant to satisfy demands of pro-democracy protesters and turn a new leaf for the troubled, albeit gas-rich, country — but which many activists plan to boycott.
Authorities have tightened the screws on the Hirak protest movement in recent weeks, and police arrested a politician and journalist who are prominent opposition figures in the run-up to the voting.
The early election is supposed to exemplify President Abdelmadjid Tebboune’s “new Algeria,” with an emphasis on young candidates and those outside the political elite. A huge number of candidates — more than 20,000 — are running for the 407-seat legislature, more than half as independents and the rest on party lists.
It’s the first legislative election since former President Abdelaziz Bouteflika was forced from office in 2019 after 20 years in power amid protests over corruption, joblessness and repression.
But the threat of boycott, worries about the coronavirus and general frustration with the political system mean Saturday’s turnout may be low.
Women make up half of candidates for the first time, among efforts to make a fresh start. But women have been largely invisible from the campaign — and in some cases their faces were blurred or concealed in campaign posters, according to newspaper El Watan.
Candidates had just 20 days to campaign, and Algerian media said real debate on major issues of concern, like unemployment, was mostly absent.
“With such a slew of candidates, the calculation of power is simple: to elect a patchwork assembly, without a majority, which will allow the president to create his own parliamentary majority with which he will govern,” said political scientist Rachid Grime.
A new election authority was formed to run the vote, and its chief said results may take up to 10 days to tally given the large number of candidates and the new system.
Many candidates couldn’t afford campaign posters. Independent candidates like Djamel Maafa, a former TV producer, used social networks to spread his message for lack of access to the funds and logistical structure of big parties.
Parties supporting the Hirak movement called for a boycott because they want a more fundamental political transition.
“Elections in Algeria have always proved that they are not the solution. The solution lies in democratic transition, it also lies in a dialogue around a table in order to solve the crisis,” said activist Sofiane Haddadji.


Abu Dhabi to provide free COVID-19 vaccines to those with expired residency or entry visas

Abu Dhabi to provide free COVID-19 vaccines to those with expired residency or entry visas
Updated 12 June 2021

Abu Dhabi to provide free COVID-19 vaccines to those with expired residency or entry visas

Abu Dhabi to provide free COVID-19 vaccines to those with expired residency or entry visas
  • Prior to the decision, only those with an Emirates ID or valid residency could register to take the vaccine in the capital

DUBAI: Abu Dhabi will provide free coronavirus vaccines to people with expired residency or entry visas to ensure their safety, Abu Dhabi Media Office said in a tweet on Saturday.
“To receive the free COVID-19 vaccine, any type of formal identification, even if expired, can be used to register at the designated vaccination centers,” it added.
Prior to the decision, only those with an Emirates ID or valid residency could register to take the vaccine in the capital.
The decision comes days after the emirate announced the implementation of the ‘green pass’ system of entry into most public places in the emirate.
Starting June 15, visitors to places including malls, large supermarkets, gyms and hotels must show their color code on Al Hosn app to be allowed entry.
“Abu Dhabi Emergency, Crisis and Disasters Committee has approved usage of green pass on Al Hosn app, based on the emirate’s 4-pillar strategy to combat COVID-19 focused on vaccination, active contract tracings, safe entry and adopting preventive measures,” it tweeted.
The Al Hosn color-coding system has six categories, including fully vaccinated, second dose recipients and first dose recipients waiting for a second dose appointment, Abu Dhabi Media Office said.
The decision covers individuals aged 16 and above.


Gulf, Arab states and organizations hail UAE election to UN Security Council

Gulf, Arab states and organizations hail UAE election to UN Security Council
This United Nations handout photo shows a view of the Security Council meeting at the UN in New York. (AFP file photo)
Updated 12 June 2021

Gulf, Arab states and organizations hail UAE election to UN Security Council

Gulf, Arab states and organizations hail UAE election to UN Security Council
  • The UAE is one of five countries elected to sit as non-permanent members on the Security Council in 2022 and 2023

DUBAI: Gulf and Arab states and organizations hailed the UAE’s election to a non-permanent seat on the United Nations Security Council for 2022-2023.
Ali bin Saleh Al-Saleh, Bahrain’s Shura Council Chairman, expressed his pride in the UAE’s achievement.
This confirms the country’s dedicated efforts to promote global peace and security, the official added, in a report from state news agency BNA.
Adel bin Abdul Rahman Al-Asoumi, speaker of the Arab Parliament, expressed his full confidence in the UAE’s ability to face major challenges, wishing the country success, Saudi Press Agency reported.
Secretary-General of the Organization of Islamic Cooperation, Dr. Yousef bin Ahmed Al-Othaimeen congratulated the UAE, Gabon and Albania for their achievement. He said their winning of seats in the UN Security Council reflects their role in consolidating international peace, SPA added.
Kuwait’s Foreign Minister Sheikh Dr. Ahmad Nasser Al-Mohammad Al-Sabah meanwhile discussed with UAE counterpart Sheikh Abdullah bin Zayed Al-Nahyan during a phone call his country’s full support to the UAE in achieving world peace and security.
Jordan’s foreign ministry, likewise, expressed its support for the UAE in serving common Arab issues and interests and preserving international stability and security, according to state news agency Petra.

The UAE is one of five countries elected on Friday by the UN General Assembly to sit as non-permanent members on the Security Council in 2022 and 2023. The others are Brazil, Albania, Gabon and Ghana, and the new arrivals could potentially shift the power balance within the world body, diplomats predicted.

“The UAE’s campaign for Security Council membership was based on its commitment to promoting inclusiveness, stimulating innovation, building resilience and securing peace at all levels,” state news agency WAM reported.

The country affirmed its firm belief in the importance of building bridges to strengthen relations between members of the Security Council, and rebuilding the confidence of member states in the council’s ability to respond effectively to challenges to international peace and security.

“The UAE has always been ready to assume its share of the responsibility to confront urgent global challenges, in cooperation with the international community, and this was the primary motivation for our campaign for Security Council membership,” said Sheikh Abdullah bin Zayed, the UAE’s minister of foreign affairs and international cooperation.

“The UAE has committed itself to multilateral action, international law and the UN Charter since its establishment, and the country will continue to adhere to these principles during its membership of the Security Council.

“I am confident that our history and our role as a reliable partner and mediator will enable us to make an effective contribution during the two years that we will serve on the Security Council. We are aware of the great responsibility associated with the membership, the importance of the challenges facing the Security Council, and with determination and perseverance the UAE will be keen to maintain international peace and security.”

Lana Zaki Nusseibeh, the UAE’s permanent representative to the UN, said her country’s role on the Security Council “stems from our belief that our values and principles can help advance progress toward our common goal of international peace and security.”

She added: “During the two years that we will serve on the council, our team here in New York, Abu Dhabi and around the world will work constructively with our colleagues from the member states to overcome divisions and make tangible progress in addressing the most serious challenges, from building resilience to climate change to addressing global health crises and epidemics, and taking advantage of the potential of innovation to achieve peace.”

The UAE will be committed to working as part of the Security Council in a spirit of cooperation and partnership, she said.

FASTFACT

The five new UN Security Council members will start their terms on Jan. 1, replacing five countries whose two-year terms end on Dec. 31 — Estonia, Niger, Saint Vincent and the Grenadines, Tunisia and Vietnam.

Nusseibeh also congratulated Albania, Brazil, Gabon and Ghana on their election to the council and said she “looks forward to working together to build a more peaceful, secure and inclusive future.”

The five countries will take their seats on the council in January, replacing Saint Vincent and the Grenadines, Vietnam, Estonia, Niger and Tunisia.

The shift will change the balance of power within the Security Council, diplomats predicted. One diplomat, speaking on condition of anonymity, said: “Brazil and the UAE have strong positions in foreign policy, and Albania, which will sit on the council for the first time in its history, is also a member of the Organization for Islamic Cooperation.”

Of the 193 available votes, Brazil received 181, the UAE 179, Albania 175, Gabon 183 and Ghana 185.

The Security Council has 15 members. Five (the US, the UK, China, Russia and France) are permanent members with a right of veto, and 10 are elected, non-permanent members, half of whom are replaced every year.

The UAE joined the UN in 1971, the year the country was founded. The only time it has previously held a seat on the Security Council was in 1986-1987.

– with AFP


15-year-old Palestinian shot dead by Israeli soldiers

15-year-old Palestinian shot dead by Israeli soldiers
Palestinian women mourn during the funeral of Mohammad Hamayel, 15, who was killed during clashes with Israeli security forces in Beita, West Bank, on June 11, 2021. (AP Photo/Majdi Mohammed)
Updated 12 June 2021

15-year-old Palestinian shot dead by Israeli soldiers

15-year-old Palestinian shot dead by Israeli soldiers
  • Violence in the West Bank increased in early May, with at least 30 Palestinians killed in clashes with Israeli forces and in alleged attacks

RAMALLAH: A Palestinian teenager died on Friday after the Israeli Army shot him during clashes in the West Bank, Palestinian medics and the Health Ministry said.
“Mohammad Said Hamayel, 15, died in clashes” with Israeli forces near Beita, south of Nablus, the Palestinian Red Crescent said.
The Palestinian Health Ministry said six others had been wounded by live gunfire.
The Israeli Army did not immediately respond to an AFP request for comment.
According to Wafa, the Palestinian news agency, the violence took place during “a public protest against Israel’s construction of a colonial settlement outpost near the village,” to which the army responded with live fire and teargas.

BACKGROUND

The teenager’s death comes a day after three Palestinians were killed by Israeli special forces on a mission to arrest suspected ‘terrorists’ in the occupied West Bank.

Violence in the West Bank increased in early May, with at least 30 Palestinians killed in clashes with Israeli forces and in alleged attacks.
That came amid a flare-up in Israeli-occupied East Jerusalem that led to 11 days of airstrikes launched by Israel against Hamas fighters in the besieged enclave of Gaza.
West Bank villages often hold Friday demonstrations against land confiscation, house demolitions and Israeli settlements deemed illegal under international law.
The events are often punctuated by clashes with the Israeli army.
Some 475,000 Israeli settlers live in the occupied West Bank, home to more than 2.8 million Palestinians.