BrazilGCC leaders positive on economic outlook and investment climate
The majority of leaders in the GCC region are optimistic on the outlook for the rest of 2024, anticipating improvements in their local economies. That is according to a survey of leaders conducted by Teneo.
The survey questioned leaders in businesses across the six GCC countries in both the private and public sectors. The results highlight how the GCC has become a pillar of economic stability and has managed to maintain steady growth amid continued geopolitical and macro-economic unrest. In the months ahead, the GCC is expected to continue doing well.
Macroeconomic outlook
Among the decision makers surveyed by Teneo, 62% said they expect the global economy to improve throughout the rest of 2024, showing that a larger percentage is optimistic about their own regional economy than the global economy.
“The GCC countries have seen sustained economic progress backed by clear leadership vision. These advancements have solidified the GCC’s position on the global stage, showcasing the region’s dynamism and enduring potential,” commented Nicholas McDonagh, senior managing director and head of Teneo in the Middle East.
The most optimistic countries in the GCC are the UAE and Saudi Arabia. A total of 72% of leaders in the UAE and 82% of leaders in Saudi Arabia said that they believe their regional economy will improve by the end of this year.
This optimism could be due to many different factors, but the economies of the GCC have overall proven to be remarkably crisis-resistant, having fared the pandemic quite well and continued on to mostly dodge the worst of the fallout from rising inflation and geopolitical instability over the past few years.
Geopolitical headwinds
A total of 26% of decision makers in the GCC expressed reservations about their organizations’ readiness to navigate the challenges posed by geopolitical instability. Though that is a significant percentage, geopolitics ranked as the only seventh in a list of concerns.
With war raging in Israel/Palestine (and potentially Lebanon), the Middle East is increasingly facing the risk of a larger regional breakdown. Whether and how the nightmare hypothetical case of a wider conflict would impact the Gulf States is unclear, but leaders in the Gulf are certainly aware of the danger.
UAE-based leaders expressed the most confidence in being ready to address future geopolitical instability. 54% of leaders in the UAE said they felt “very well prepared”, as compared with only 29% in Kuwait and Saudi Arabia, and 24% in Qatar that said the same.
The reasons for this high level of confidence in the UAE in navigating geopolitical headwinds may be linked to the country’s overall stability and economic diversification. As other countries in the region still struggle to expand beyond oil, the UAE has built a number of robust industries that make it more prepared for turbulence in the near term.
Investment
Most decision makers in the GCC agree that attracting investment is one of the most important transformative forces that shape their organization’s direction and growth. A total of 52% of those surveyed said that investment opportunities have a very positive impact on their organizations.
More than half of the surveyed leaders believed that the GCC region can attract more international investors by adopting sustainable practices and investor-friendly tax policies. Foreign direct investment is seen as very important for countries across the Middle East.
On the report’s findings, Andrew Liveris, senior advisor at Teneo, said: “The GCC’s resilience amidst global disruption highlights its unique position in the international business landscape. The region must continue to move beyond being seen merely as a financier and unapologetically establish itself as a credible partner in tackling global challenges.”
The results by Teneo echo those of a similar study that was released earlier this year by PwC, which found that CEOs in the Middle East are the most positive in the world when it comes to macroeconomic expectations, despite acknowledging they may face heightened risks & challenges as opposed to other parts of the world.
