Dubai – “ASWAQ”
Businesses in the UAE, according to industry experts, will need to be cautious in their approach to be able to sustain a steady growth trend in 2016, despite a slowdown in the global economy due to record-low oil prices as well as the geopolitical instability in the region.
Industry experts are confident that the UAE economy will stay resilient to the heavy blows of the volatile oil prices and equities, tight liquidity and slowdown in Europe, China and emerging markets. The government’s economic diversification policies will help to make it resilient to macroeconomic risks and ensure the economy is on growth trajectory in 2016.
Hussain Al Qemzi, chief executive officer (CEO) of Noor Bank said, “Liquidity might have tightened compared to 2014, but it is also a fact that the sector’s average capital adequacy ratio is 18.3 per cent, which is significantly higher than the required 12 per cent. Moreover, although a portion of SME financing has gone sour, it is less than 5 per cent of banks’ books.”
Al Qemzi added, “Banks have become more risk averse, cooling lending growth. But it is prudent to take these short-term steps to make sure we do not run into systemic problems in the long run. Nevertheless, with the guidance and support of the central bank, UAE financial institutions will continue to perform steadily in 2016.”
Noor Bank is said to have grown steadily over the past 8 years by playing to its strengths in the UAE’s competitive banking landscape.
Real Estate Sector
Businesses and investors’ confidence in the real estate sector remained stable without panic, despite the softening in the real estate industry since the fourth quarter of 2014.
Rahail Aslam, chief executive of Select Group, said “It’s interesting to see the diversity of international investors in the property market, encouraged by Dubai’s infrastructure, strategic location, political stability and lucrative investment opportunities.
“Business activities outlook later this year, seem more promising and we are expecting a modest economic rebound by the end of 2016, and we expect to see mobilisation of many 2020 related projects later this year.” Aslam said.
Aslam added, “We are positive that under the directives and patronage of His Highness Shaikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, economic challenges will be conquered and the healthy business environment should resume later this year.”
Year 2016, a year for Consolidation
Companies will be in a better position in the market if they are able to adapt to mobile technology especially with technology converging more and more in the daily routines. This will assist companies to identify new opportunities instantly.
Amit Rupchandani, managing director for Middle East and Africa region at Obi Worldphone said, “Despite some challenging periods, the UAE has developed into one of the most promising emerging markets, and has always invested heavily in technology. Year 2016 will be no different, and we foresee Dubai continuing to be the gateway for global technology.”
Harmeek Singh, owner and founder of Plan b Group, said that 2016 will be a year of consolidation whereby businesses will have to adopt an open approach to opportunities.