Middle East Bank CEOs 'Cautiously optimistic on growth for 2013'
- United Arab Emirates: Tuesday, October 02 - 2012 at 10:09
- PRESS RELEASE
A detailed study has found that a large majority of bank CEOs in the MENA region are cautiously optimistic on growth for 2013. The study which was conducted by Stormbridge International, a leading human capital consulting firm, found that there are positive signs ahead but CEO's remain cautious about growth in 2013.
Andre Nasr the CEO of Stormbridge International comments "The findings from our study highlight a significant shift in the overall confidence for both international and regional banks across the Middle East. There is a strong sentiment amongst the CEO community that 2013 could provide opportunities for growth and in some cases, such as Qatar and Abu Dhabi, increased expansion into new markets."
Qatar and Abu Dhabi are continuing to lead the growth and the confidence amongst the CEOs in these locations unsurprisingly scored the highest in the survey. Dubai showed some positive signs over the last 12 months and confidence was up, however with the central bank recently cutting its growth forecast and the government not spending at the levels the region is used to, this has created a sense of caution for 2013. Infrastructure spending in the UAE and the increase in the manufacturing sector are seen as the key areas of growth opportunity. Nasr comments "The recent announcement by the Al Habtoor group to develop a $1.3bn resort is a key example of how Dubai is reigniting growth."
It was also highlighted that whilst confidence was returning to some countries in the Middle East there were also significant risks and challenges that lie ahead for others. Several economies in the GCC are experiencing low levels of growth and the need for political and government intervention was identified as the key to igniting the economy. A lack of government spending and increased regulation is also having a direct impact on growth in these countries.
With the continued political and security situation in some parts of the region, CEOs in these locations remain cautious of reaching significant levels of growth next year. The continued issues arising from the Arab Spring ranked the highest on the risk factors for both 2012 and 2013. Nasr comments "The current challenges in other parts of the Middle East can only serve to develop the more stable regions such as the UAE which is fast becoming the key hub for investment across the Middle East in the same way that the Swiss economy developed during the second Wold War".
The challenges in the Eurozone and the American slowdown in growth have also served to provide caution to the MENA banking market. Whilst many banks in the region are not directly affected by the Eurozone it only serves to act as another risk to monitor for CEOs in the region.
Many CEOs see the current challenges also as opportunities, with the need to implement new regulation, control and liquidity management only serving to hold the banking market in a stronger position moving into 2013.
The number of banks looking to expand internationally has slowed and this has left them fighting it out amongst their regional competitors for market share and this has created fierce competition in an already competitive marketplace.
The study found that many CEOs are still ambitious to hire senior talent into their organisations but are having to be more selective and cautions. Nasr comments "the times have changed in the region, the volume approach to hiring has slowed and banks are placing greater emphasis on developing nationals for their senior positions as well as importing talent into the region from the more mature markets".
The report concludes by stating that the confidence levels overall across the Middle East are increasing and are at their highest levels for the last four years but the region remains on guard for challenges that undoubtedly lie ahead
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