UAE Business Barometer: Bullish on a bright future

The UAE's economic growth will surge next year, driven by a host of non-oil sectors, hence improving the job prospects and strengthening the competitiveness of the local economy, according to CEOs of the top UAE companies. Khaleej Times spoke with top industry executives in the UAE who maintain that sentiment will pick up significantly in the second half of this year, resulting in increased economic activity over the next 18 months, generating more work opportunities and higher contribution to GDP from non-oil sectors.

The International Monetary Fund has projected that the UAE's real GDP will jump 160 per cent from 1.3 per cent this year to 3.4 per cent next year, while real non-oil GDP will see a significant growth of 3.3 and 3.4 per cent in 2017 and 2018, respectively. Moreover, the UAE was also recently ranked among the world's top 10 most competitive economies for the first time, jumping five places to the 10th slot. The latest World Economic Forum Global Competitiveness Report 2016-2017 also ranked the UAE as the top country in the Arab world in competitiveness. It climbed one spot from last year in the global rankings to 16th position.

Led by Dubai, the UAE economy is projected to strongly benefit from growth in infrastructure development, tourism, trade, aviation, healthcare, insurance, real estate and manufacturing industries. As we're headed towards the Expo 2020 mega-event, certain sectors such as hospitality, real estate and construction will witness substantially increased investments worth billions of dirhams from the private sector while the government will pump in billions of funds in the development of roads, Al Maktoum Airport - which is expected to handle 26 million passengers a year upon completion of expansion - and other logistics facilities. Most private sector entities will push to complete their residential, commercial and hospitality projects ahead of the event, resulting in New Dubai areas getting much more focus of local and foreign investors and also creating opportunities for professionals in these sectors.

Strong feel-good factors have already begun to come into play as the latest purchasing manufacturing index for the month of June witnessed good improvement, thanks to sharper rises in both new orders and output. Similarly, Dubai Airports also announced that it handled 43 million passengers during the first half of 2017, up 6.3 per cent.

A recent report produced by Oxford Economics highlights that the UAE economy is benefitting from the rebound in global trade and growth in tourism sector at a better rate than other Gulf economies.

As the IMF recently said, UAE economic activity is expected to strengthen gradually in the coming years with firming oil prices and other global indicators, and an easing pace of fiscal consolidation. In addition, the country's financial buffers, safe-haven status, sound banks and diversified and business-friendly economy are helping it cope with the shock. A report by BNC Network earlier said that currently 7,488 building projects worth $228 billion (Dh837 billion) are currently in concept, design, tender, under construction, and on hold stages by June 2017, with most of the Dubai projects expected to be completed ahead of Expo 2020.

Based on these strong and rosy prospects for the country's economy, UAE CEOs that Khaleej Times spoke to all are quite sanguine and expect increased job opportunities for Emiratis and expats, higher inflow of expats looking for better prospects and more investment in different sectors. (With inputs from Sandhya D'Mello, Issac John and Waheed Abbas

WHAT DO THE INDUSTRY EXPERTS HAVE TO SAY

One way to go: up

Yusuffali M.A., chairman of Lulu Group

I have always maintained that the UAE economy can only go one way, upwards. Whatever slowdown or sluggishness one might see is just a short-term issue. The kind of vision that has been set by the leaders will surely push the trade and economy to the next level, which will see all round growth in various sectors including the ever changing and ever developing retail sector. So obviously, the job market will surely see a positive impact with many new concepts and projects taking shape. One has to be very well-prepared and do a lot of homework before venturing into new investments, as the market is very matured and demanding, and nothing less than the world's best would do

'Healthy' Growth

Dr B.R. Shetty, founder, joint non-executive chairman, NMC Healthcare; chairman, UAE Exchange

With the government's stress on providing world-class medical care and related facilities, the UAE has emerged as the preferred destination for medical treatment in the Middle East and Africa region. I believe the healthcare and financial sectors will continue to be the key economic growth engines. The UAE's diversified economy is poised for a rebound in 2018 irrespective of the oil price factor since the country has become a global hub for investors and businesses looking for a safe and productive investment ecosystem.

'Quantum leap' Ahead

Dr. Azad Moopen, founder chairman of Aster DM

The UAE is one among the most sought-after countries by investors in the world. There are many HNIs from countries far and near who have made the UAE their second home. The dependence of the UAE economy on oil is coming down every year with significant economic opportunities that are unfolding in other areas. Apart from traditional areas of focus on logistics, trade, travel, tourist, etc, the UAE is now looking at new sectors like finance, IT and media, etc. There is also the huge opportunity arising out of Expo 2020. On the whole, the economy is poised for a quantum leap maintaining a high GDP growth.

Realty is for real

Rizwan Sajan, chairman of Danube Group

I believe one of the fastest-growing sectors at present and the years to come will most definitely be the property sector. It is already showing signs of growth as there are numerous projects underway and developers across the UAE have giant expansion plans as we move towards Expo 2020. As more projects are launched, there will definitely be a need to hire more people to carry out the increased activity. We will see hiring across all verticals of construction be it construction workers, property brokers or even property managers. As we witness an increase in the investments made by UAE government investments, especially due to Expo 2020, there will be a boost in the economy.

More jobs

Promoth Manghat, CEO of UAE Exchange

The UAE is aggressively surging on the progressive path with frameworks like UAE Vision 2021 with a specific national agenda. This framework is comprehensive and its aim is to name the UAE among the best countries in the world, thus strengthening the economy. Apart from these, various other initiatives and projects are expected to fuel the market further, bringing more opportunities to the table. With growing economic activities and developmental programmes, the jobs sector is sure to open more doors for skilled and semi-skilled professionals. This means along with job opportunities created to UAE citizens, more expatriates will enter the UAE in search of better prospects.

Diversification drive

Adeeb Ahamed, managing director of Lulu Exchange

In the coming years, we foresee durable growth and consolidation for the money transfer industry in the UAE. With greater economic diversification in place, the UAE has seen good growth in jobs, resilience to oil price volatility and improved prospects for businesses and individuals. The money transfer industry is set to thrive over the next few years on the back of this strong economic outlook supported by growing economic activity. The UAE has been very proactive in diversifying its economy and have been promoting a slew of industries such as fintech, hospitality, tourism, retail and education, to name a few. This has been in good stead for the economy and given a fillip to various sectors. The country's long-term outlook looks very promising and 2018 will be another great year to look forward to.

Resilient and Robust

Gaurang Desai, CEO of Dubai Gold and Commodities Exchange

We are very optimistic about the UAE's growth and we expect economic activity and sentiment to pick-up significantly in the second half of 2017 and 2018. Despite the slowdown in economic activity, the UAE has held its own and proved its resilience, which lends a lot of confidence to stakeholders about the economy's prospects.

Fair and Competitive

Dr Ram Buxani, chairman of ITL

The UAE has always been a consumer-friendly economy while providing fair opportunity to investors. Whenever there is shortage leading to monopolistic attitude of the investors, leading to price rise, government has stepped in with competitive projects to neutralise the unrealistic hikes.

Retail's big influence

Shamlal Ahamed, managing directorfor international operations at Malabar Gold & Diamonds

We are expecting the growth rate in our jewellery retail sector to increase from October 2017 due to multiple factors like festivities, holiday season, shopping festivals and tourist influx. The recent implementation of GST in India also has favoured the jewellery industry in the UAE. I expect a lot more tourists to visit the UAE due to a catchment population of over three billion from Arab-African countries, as well as Indian Subcontinent countries. This will only increase in the future due to the major infrastructural developments and investments in leisure and entertainment sector across the UAE. The expansion and availability of retail spaces within the UAE also will lead exponential growth in retail thereby leading to overall growth as compared to today. The resident market is also expected to increase due to the jobs created in preparation for Expo 2020. Overall, we are optimistic about the growth and we are aggressively expanding to take advantage of the renewed confidence and the opportunity that lies ahead in the UAE in the coming years.

Spending wisely

Taher Shams, managing director of Zulekha Healthcare Group

We ourselves will be adding at least 600 jobs by early next year with the expansions taking place at our Sharjah and Dubai Hospitals. As it is seen that government spending is increasing on infrastructure, health and education definitely, which gives confidence to the private sector and also benefits directly to keep investing, which in return boosts the UAE's economy.

Buzzing economy

Paras Shahdadpuri, chairman of Nikai Group

After the oil shock two years ago, the prices of oil have stabilised (from its lows of $30) at around $50 and the market has started looking up. There is a clear economic buzz in the UAE and we hope this will be sustained. No doubt there is a big contribution of the UAE authorities in ensuring that the wheels of economy are adequately oiled by investing in infrastructure, in construction industry, etc by creating new ideas in the field of tourism and make UAE as a favourite destination for FDI in logistics and other sectors. What is most important is that the authorities must keep a sharp eye on the competitive edge of doing business and making sure that the investors and businessmen are encouraged with lower costs of doing business, including rentals by semi-government or public sector entities, etc. It is important to keep up the morale and psychology of the investors.

Service with a Smiley

James Mathew, Group CEO of Crowe Horwath UAE and Oman

The services sector is expected to grow better compared to other sectors in the current macro economic and political scenario. Tightened banking policies, introduction of VAT in 2018 and associated compliance requirements will bring in the need for more accountants in this region. Out of 300,000 registered companies, it is estimated that more than 50 per cent do not maintain proper books of accounts. This is a huge emerging opportunity. These factors, along with the consolidation we may witness in rise in M&A activity in the region in some core sectors because of the shake out of weak players, should lead to a steady growth in the financial services sector and an overall boost to economy. Further diversification efforts of the economy into tourism, healthcare, education, technology, aerospace, industrial manufacturing etc along with the ongoing construction sector focus will drive the growth of the economy in the coming years.

Welcome to my home

V.A. Hassan, chairman of Flora Hospitality Group

Since we anticipate a major spurt in tourist arrivals to the UAE in the coming years, and given the expected surge in demand for hotel rooms for Expo 2020, we plan to double our capacity from the current 1,500 rooms to 3,000 over the next couple of years. To facilitate this expansion, we may have to recruit another 3,000 people in the coming months.

Strength in diversity

Dany Farha, CEO of Beco Capital

A very recent sign of this is when the global economic data last week was published showing a strong global economy, GCC stock markets didn't rally except the Dubai market, which rallied with strong global markets, showing the importance of Dubai's diversified economy linked to global trade and continuing diversification away from oil, which is clearly a resource and sector that will decline in importance over time.

Hiring on rise

Mahesh Shahdadpuri, CEO and founder of TASC Outsourcing

With the VAT implementation on the anvil, there is already demand for professionals with IT and finance background. While the hiring in some sectors such as aviation and retail have remained flat during the first half of the year, we do foresee this trend changing to positive in the coming months. Expansion plans of the Al Maktoum International Airport and the Dubai World Central will provide the catalyst for the increased hiring in the aviation and allied sectors.

UAE regional economic leader

Walid Hanna, founder, and CEO of MEVP

Industry leaders in both the public and private sector are recognising the need for investing away from traditional sectors and into the digital economy. This refocusing will insure sustained economic growth for the next decades and cement the UAE's position as a regional economic leader.

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