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GCC Investment and Development Awards 2018
Following disappointing GDP growth in 2017, GCC nations made a concerted effort to ensure sustainable economic development and structural diversification were prioritised throughout 2018
Since its inception in 1981, the Gulf Cooperation Council (GCC) has pushed an ambitious programme of infrastructure development and economic reform, with the aim of reducing the region’s dependence on oil. The importance of this diversification project has become clear over the past 12 months, as fluctuations in crude oil prices have revealed weaknesses in the region’s economies.
Global trade tensions and the reimposition of US sanctions on Iran have also contributed to a challenging fiscal environment. However, this has only spurred the GCC’s programme further, with countries including Qatar and Saudi Arabia accelerating development projects. Investment has also been catalysed by the renewed drive for diversification, with foreign investment increasingly encouraged by regional governments. This has led the IMF to raise its economic growth predictions to 3.9 percent over the next 12 months, according to its Regional Economic Outlook.
In the quest for growth, the most successful players are, as ever, those that balance speed and sustainability by implementing structural reforms alongside investment. The World Finance GCC Investment & Development awards recognise those that are taking action now to safeguard the future economy.
Leaving oil behind
Economic growth in the GCC bottomed out in 2017, falling by 0.2 percent across all six member states. Saudi Arabia saw its first economic contraction since 2009, due for the most part to oil production cuts introduced by the so-called ‘OPEC+’ group. Historic heavy reliance on oil revenues has left many GCC nations beholden to the fluctuations of the market, which has been particularly volatile since hitting a low point in 2014.
The outlook for oil was far brighter in 2018, with prices climbing to four-year highs of $82.16 per barrel in September. This provided a spell of relief for the GCC’s five oil-exporting nations, with Oman registering the region’s leading GDP recovery of 3.8 percent. Nevertheless, past oil fluctuations have clearly spooked the GCC states, with all opting to pour additional funds into non-oil ventures in 2018.
Infrastructure development in particular has accelerated in the context of several high-profile global events, notably Expo 2020 Dubai and the 2022 FIFA World Cup in Qatar. Qatar is forecast to spend $220bn in preparation for the tournament, which includes the construction of an entirely new city, Lusail, featuring a 90,000-seat stadium where the final game will be held. Once complete, the city is expected to house 250,000 future residents. Meanwhile, Dubai has allocated AED 56.6bn ($15.41bn) to Expo preparations, which comprise the conference site itself, an extension of the metro line to access the area, and the AED 735m ($200m) Museum of the Future, which is widely considered to be one of the most complex buildings in the world.
In Kuwait, construction forms part of the country’s seven-pillar New Kuwait Vision 2035 strategy, which aims to transform the country into a financial and trade centre. At the annual Leaders in Construction Summit, the country’s chief of development, Talal Al-Shammari, announced a 46 percent increase in capital expenditure on infrastructure projects for the 2018-19 financial year, to $14.4bn.
Supportive substructure
Many GCC countries have also embarked on a programme of bureaucratic reform to complement infrastructure development and allow the private sector to thrive. In February 2018, Bahrain introduced a wage protection scheme that seeks to end the exploitation of staff by ensuring they are paid on time. It was launched in May and will be rolled out in a controlled release programme until May 2019.
Qatar’s visa-free entry programme, launched in 2017 in an effort to boost tourism, has been expanded this year to include Indian and Ukrainian nationals in a sign of increased openness from the Qatari Government. It has also pledged to put an end to the notorious kafala system that disadvantages migrant workers. However, more transparency is needed with regards to workers’ rights.
In May, Kuwait’s parliament voted to delay the introduction of VAT until 2021, ensuring operating costs remain at the current rate for private companies. To date, Saudi Arabia and the UAE are the only GCC countries to have implemented VAT.
With regards to the international sphere, all GCC countries have been opening up their economies to foreign direct investment (FDI) over the past year as part of their respective diversification strategies. In terms of volume, the UAE is the region’s largest destination for FDI, drawing in around $9bn in 2018. The country has also announced key changes to its residency programme, offering foreign investors a 10-year residency visa with the aim of boosting FDI by 15 percent over the next year. Meanwhile, FDI inflows to Bahrain grew 138 percent over the first three quarters of the year, the fastest rate of all GCC nations. In May, the country announced it would extend the term of residence visas for qualified investors and professionals from two years to 10 to further attract foreign interest.
In the past 12 months, under its Saudi Vision 2030 plan to transform economic and social infrastructure, Saudi Arabia has implemented more business-related reforms to boost international investment than any other GCC country. The World Bank noted it introduced reforms across six of its 10 pillars in its Doing Business 2018 report, from reducing documents needed for customs clearance to implementing online systems for administrative tasks.
The kingdom has welcomed western banks in particular, with Citibank becoming the latest firm to receive a banking licence, joining JPMorgan Chase and HSBC. International fiscal interest was reignited at the beginning of 2018 when Saudi Arabia announced it would float five percent of state oil giant Saudi Aramco. This was predicted to be the largest IPO in history before it was called off in August, with the company’s chairman, Khalid al-Falih, announcing in a statement: “The government remains committed to the IPO of Saudi Aramco at a time of its own choosing when conditions are optimum.” He added that the timing of the IPO will depend on “favourable market conditions” and a “downstream acquisition”, which the company will pursue in 2019. London, New York and Hong Kong exchanges have been vying for some time to list the Saudi oil giant, which is expected to be valued at around $5trn at IPO.
Looking ahead
The GCC has plenty to look forward to over the next few years, with high-profile events bringing prosperity and new interest to the region. The IMF named the FIFA World Cup and Kuwait’s implementation of five-year growth plans as key stimuli over the next 12 months. Increased FDI and further progress on key infrastructure development projects will also help diversify the economies of all six member nations.
As ever, those that are committed to economic diversification, welcoming foreign investment and opening up their nations are the firms that are reaping the rewards of the affluent region. It is these individuals and companies that World Finance recognises in the 2018 GCC Investment & Development Awards.
Source: world finance
WEF: Dubai shows the way to growth in Middle East
Emirate a global magnet for international firms, helping transform plans and ideas to reality
The only way for the Middle East to address economic challenges is to open up an economy like Dubai, which has set an example and showed the world how to achieve sustainable growth despite geopolitical and financial headwinds that the region faced over the past decades, minsters and private sector executives said at the World Economic Forum (WEF) in Davos.
At Davos, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, met Apple CEO Tim Cook and Cisco CEO Chuck Robbins, where the Crown Prince affirmed that the UAE and Dubai's experiments present a model for development and offer an incubator for innovation and technology.
He said Dubai became a global magnet for international companies and entrepreneurs as the emirate offers good opportunities to help business leaders to transform their plans and ideas to reality.
Sheikh Hamdan also attended the signing of an agreement to establish the Emirates Centre for the Fourth Industrial Revolution in the UAE. The agreement was signed by Mohammad bin Abdullah Al Gergawi, Minister of Cabinet Affairs and the Future, vice-chairman of the board of trustees and managing director of Dubai Future; and Professor Klaus Schwab, founder and executive chairman of the WEF.
Mohammad Al Tuwaijri, Saudi Arabia's Minister of Economy and Planning, said Dubai has set an example for the Arab world on how to achieve growth despite political, economic and financial headwinds.
"Talking about practical solutions for the region, if I take Dubai as an example, they started their [growth] journey in late-80s and I can't count negative events that took place in the region during this period from the Gulf war to Asia crisis and oil volatility," he said. "Yet, Dubai is here, growing and showing the world an example what it could achieve. Dubai has established a role model and has done a great job."
Alain Bejjani, CEO of Majid Al Futtaim, said solutions of economic problems for the Arab world will come only from the private sector and regional governments should open up their economies just like Dubai.
"The only solution for the region is to open up the economy - just like Dubai. The private sector in Middle East countries will come and invest. We know what are the investment opportunities; the government doesn't need to tell us. Put aside Saudi Arabia and the UAE, there is no government in the Arab world that has ability to deal its issues on its own," Bejjani said during a panel discussion.
According to Dubai FDI figures, Dubai remains a magnet for global foreign investors, especially in new-age sectors such as e-commerce, AI, blockchain and fintech, as the emirate recorded a 26 per cent increase in foreign direct investment (FDI) in the first half of 2018, reaching Dh17.7 billion. The number of FDI projects surged 40 per cent year-on-year to 248 during H1 2018, reflecting growing confidence in the emirate's economy and its policies. Backed by accelerated government spending prior to Expo 2020 Dubai, the International Monetary Fund had predicted Dubai's economy to expand 3.3 per cent in 2018 and 4.1 per cent in 2019.
The Saudi minister also pointed out that the UAE and Saudi Arabia are working hard to ease and digitise cross-border trade and remove barriers.
"Recent joint efforts with the UAE are significant that two countries can sit down and agree on very specific targets, measures where they can show the world how and issues can be resolved. For example, between the UAE and Saudi Arabia, we decided that borders will be easier, digitised and quicker accessibility of trucks, etc. Instead of taking more than 72 hours, they will hopefully take three to four hours," Al Tuwaijri said.
He hoped that other regional countries will join the UAE and Saudi Arabia when they see this model working.
"We want to establish a reference for others to follow. If two big nations with big GDPs succeed, I think we will have a better chance and opportunity."
Bejjani said after Dubai and Abu Dhabi, vision 2030 by Saudi Arabia has been a whiff of fresh air.
"What is happening between the UAE and Saudi Arabia is exemplary. If this [removal of trade barriers] becomes reality and it is moving fairly at quite a rapid pace, the private sector we will invest in the Arab world," he added.
He said scale and global relevance and competitiveness are the two biggest problems when it comes to entrepreneurship, startups or corporates in the Arab world.
"During the past century, some of our countries gained independence and some were formed. And we have been working ingeniously on making sure that we put barriers across the Arab world. And the reality is that we have a market that is as big as most of largest markets in the world such as Western Europe and the US; but we are not smart enough to work together... We didn't do enough and if we want to promote innovation and promote growth we need to give market to the people who want to invest in it," Bejjani said during the panel discussion.
Citing examples of San Francisco and Palo Alto, he said Silicon Valley exists not because that people born there were smarter but simply because they have good education system and have market.
Source: zawya
How Ad Tech Entrepreneurs Can Combat Google and Facebook's Dominance
28 Jan 2019 Written by Admin AdminHow Ad Tech Entrepreneurs Can Combat Google and Facebook's Dominance
The best way to secure a share of the growing market? Avoid head-to-head competition with the duopoly and instead seek out new opportunities -- like these.
Although few consumers have heard of them, ad tech firms have been operating behind the scenes for the past decade or more, creating innovative processes such as programmatic advertising (automated ad buying) and header bidding. Once fueled by the huge growth in online ad spend and an abundance of cheap venture capital, the rise of ad tech startups is now waning thanks to the duopoly held by Facebook and Google.
2017 saw global digital ad spend reach new heights -- $88 billion, according to the Interactive Advertising Bureau. Of course, of the 21 percent market growth over the previous year, 90 percent went to Google and Facebook. Meanwhile, The New York Times reports that the number of independent ad tech firms has shrunk by 21 percent since 2013. In fact, the only thing that’s shrinking faster is the investment in it. Stats collected by Crunchbase analyzing almost 2,000 venture capital deals in ad tech reveal that, by the first half of 2017, investment had dropped close to 80 percent from the peak in the first half of 2013.
Google is notorious for identifying up-and-coming competitors early and pursuing aggressive acquisition strategies. At the same time, Facebook’s 2.27 billion monthly active users mean that the social network is sitting on a goldmine of market research. It’s counterintuitive, but in a space dominated by two hungry giants, ad tech entrepreneurs need to think small to stay around.
Dodging the duopoly
The best way for ad tech entrepreneurs to secure a share of the growing market is by seeking out new opportunities instead and avoiding head-to-head competition with Facebook and Google. For example, linking data from offline purchases at brick-and-mortar retailers with online consumer data can create cross-platform identifiers that deliver tremendous value.
Streaming video is also quickly emerging as a space where startups can find potential in new revenue channels. As Amazon enters the ad business, devices such as the Echo and FireTV can enable startups to deliver ads right into customers' homes.
While there’s no guaranteed way to regain investor confidence, ad tech startups and independent firms should keep in mind that market dominance doesn’t necessarily equate to either quality or preference. In light of the slew of scandals that have rocked Facebook, concerns of consumers and regulators are rising. By focusing on transparency and vetted data alone, it might be possible for ad tech companies to win over new customers.
To further differentiate themselves from the duopoly, ad tech firms should take the following three steps:
1. Consolidate with the competition.
Viable companies in the ad tech space are beating Google and Facebook to the punch and consolidating with one another before they get swallowed up by the duopoly. Not surprisingly, the prevalence of this practice is contributing to a stark decline in the number of independent ad tech firms.
Based on research by LUMA Partners, The New York Times reports that just 185 firms remain as of the second quarter of 2018. Terry Kawaja, who led the research group, explains that “While all industries go through a maturation curve, this one faces a particular need for consolidation. So many of these companies were not profitable.”
2. Target audiences outside the duopoly.
A recently formed ad tech consortium including AppNexus, MediaMath and LiveRamp is attempting to target audiences interacting outside of Google and Facebook through the use of cross-platform identifiers. The two tech giants command tremendous value because their logged-in user bases have historically been easier to target, but the new consortium should make media investment outside the control of Facebook and Google more efficient.
To increase investor confidence, the consortium has adopted a self-imposed code of ethics covering critical issues such as privacy and security. These topics are a growing concern among those using the dominant platforms, adding another differentiator for the consortium’s consumers.
3. Identify niche markets.
To win precious ad tech dollars, entrepreneurs must do something that’s difficult for massive companies to pull off -- focus on niche markets that are high-value and low-volume. For example, Israel-based navigation app Waze targets users who want to optimize their travel and avoid speed traps. Because users rely heavily on location services to get value from the app, Waze can target them with highly customized, location-specific ads.
Google Maps couldn’t compete with the unique and high-value feature offered by Waze, so the tech giant bought the ambitious young upstart for a figure reported by TechCrunch to be $1.1 billion back in 2013.
Advertising is a lucrative market. As ad tech spending continues to rise, Europe’s implementation of the GDPR brings hope to startups and smaller companies that regulations might slow the pace of acquisition established by Facebook and Google. The window could be brief as the giants adjust to the learning curve, but if there was ever a time for disruption in the ad tech space, it’s now.
Source: entrepreneur
Startups and SMEs as drivers of economic growth in the coming years (Press Release)
22 Jan 2019 Written by Admin SAEEconomic reports ahead of AIM Startup 2019 in Dubai
Dubai, January 22, 2019
International economic studies and reports indicate that startups and small and medium-sized enterprises (SMEs) will lead the economic growth in the UAE and the GCC over the next few years. This will promote job generation which will contribute largely to an increase in consumption and spending of low-income people.
"The UAE has been alerted early to the importance of startups and SMEs in supporting the national economy and its place in contributing to GDP, " said Adib Al-Afifi, Director of the National Program for Small and Medium Enterprises (SMEs), Ministry of Economy. “We have introduced the necessary economic regulations and legislation that provide stability to the sector, and to strengthen its position, in order to attract more domestic and international investors."
Al-Afifi added, "Although this type of investment activity faces many challenges in most developing countries, it is the marketing and administrative difficulties and the low financial potential of these projects, which necessarily lead to weak marketing efficiency. However, the GCC countries, specifically the UAE, has been alerted to these challenges, thus has launched the National Program for Small and Medium Enterprises. We have adopted and promoted these investments as well as provided the ideal environment to enable these projects and impose their presence and competitiveness in the local and international markets."
According to a new study conducted by one of the international consulting offices in the region, investments for startups and SMEs in the Gulf region will reach US $2 billion over the next decade, compared to only US $150 million invested in the last ten years.
The United Arab Emirates and Saudi Arabia will play an important role in stimulating the growth potential of the region and in developing startup ecosystem in GCC. This scenario places both UAE and Saudi Arabia at the forefront, developing and sustaining an active startup ecosystem while keeping a solid pace as major international cities race to build their own smart cities using disruptive technologies.
According to investment report statistics 2018 has proven to be a record year for startups in MENA, with 366 recorded deals and an increase of funding by 31%. There was also in an increase of 5% in the number of institutions and angel groups investing in MENA-based startups increasing the number of investing institutions to 155, 30% of which are from outside the region.
UAE’s Ministry of Economy has established the National Program for Small and Medium Enterprises with the aim of empowering SMEs and developing general frameworks and guidelines aimed at providing the necessary expertise, technical and managerial support and training for SMEs.
This emphasis is being shared by the third edition of AIM Startup, a global platform for entrepreneurs which is under the patronage of the Ministry of Economy. Hosted in partnership with the National Program for Small and Medium-Sized Enterprises, AIM Startup will once again support emerging and innovative companies for three days from 8-10 April 2019 at the Dubai World Trade Centre.
AIM Startup anticipates more than 20,000 visitors who will maximize the global networking opportunities onsite. At AIM Startup, innovators are linked with potential investors and can benefit from the investment climate to form collaborative partnerships, facilitate investment deals, and gain knowledge from industry players and thought leaders.
About AIM Startup
AIM Startup was launched in 2017 as an initiative of the UAE Ministry of Economy to connect promising startups with investors and business partners from other parts of the world — set in the heart of the UAE’s Annual Investment Meeting, the world’s leading FDI platform for emerging markets and held under the patronage of H.H. Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.
AIM Startup is an ideal platform for start-up companies looking to raise capital, expand into new markets and forge meaningful business relationships with major investors, business leaders, representatives of international institutions and government entities.
For press inquiry, kindly call or email:
Shereen Hassan Al Musalami
Media and PR Manager, Strategic Marketing & Exhibitions
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.
Mobile number: +971 56 4034071
GDP growth in the region is projected to strengthen to 3.0 percent in 2018, and rise slightly.
higher in 2019-2020, with oil exporters continuing their recovery from the collapse of oil prices, and oil importers experiencing a smaller acceleration.
The outlook assumes continued policy reforms and oil prices remaining above their 2017 average. In 2018, growth in oil exporters is expected to rise substantially to 2.7 percent due to additional government spending, enabled by increased domestic revenues and firm oil prices.
In the GCC, 2018 growth will be further supported by higher fixed investment, bolstered by public investment programs and improved demand. Growth will remain stable during 2019-20, propelled by steady growth in private consumption, infrastructure investment programs like those related to the Dubai Expo 2020 or Qatar’s World Cup 2022, and the expiration of OPEC+ agreement.
Growth in non-GCC exporters is expected to be supported by higher capital expenditures.Fiscal balances in oil exporters are expected to improve as oil prices are forecast to stay firm and revenue-enhancing measures, such as VAT and energy subsidy reforms, are implemented.
These measures are expected to improve the non-oil share of government revenue in oil exporters. Higher oil prices are also expected to support remittance inflows (World Bank 2018j).
Growth in oil importers is expected to rise to 4.0 percent in 2018, as business and consumer confidence are spurred by business climate reforms and improving external demand.
Policies to relax foreign investment restrictions have supported higher capital flows, and are expected to boost foreign investment and trade flows, in part through relaxing financial constraints in firms(Kiendrebeogo and Minea 2017; Wood and Yang2016).
Tourism growth is also expected to improve upon stable security conditions. However, fiscal consolidation is expected to be an important headwind for activity among oil importers. In smaller oil importers (e.g., Jordan, Lebanon), external and fiscal imbalances remain a constraint to higher growth in the short-term. Reform programs, such as World Bank-supported initiatives to improve urban investment capacity or electricity performance, are expected to improve growth potential (World Bank 2017e, 2018k).
Similarly, public-private partnerships and bilateral agreements within the region are expected to support private sector participation in infrastructure investment, which benefits economic activity (Figure 2.4.2, Arezki et al. 2018; Calderon and Serven 2004).
Additional plans in energy subsidy reforms or tax revenue enhancement across oil importers will support further fiscal adjustment The short-term outlook in MENA is positive. Public-private partnerships are expected to support private sector participation in infrastructure investment.
However, geopolitical tensions may deter the recovery of tourism in oil importers.
Upside risks are associated with the possibility of higher-than-expected activity in key trading partners.
Risks
Risks to the outlook are diverse, but tilt to the downside. Key downside risks include renewed volatility in oil prices, an intensification of geopolitical tensions, and a slower-than-expected pace of reforms.
Nonetheless, favorable spillovers from stronger than expected activity in key trading partners and recovery in war-torn areas cannot be ruled out.
On the downside, the recent rise in oil prices may not be sustained in the short term, potentially due to higher-than-expected U.S. shale production This would reduce fiscal space in oil exporters and complicate fiscal management reform across many economies.
Tighter fiscal policy in oil exporters may lead to spillovers to oil importers via external linkages (e.g., FDI and remittances).
Volatility in oil prices may also affect oil importers through their current account exposure to higher oil prices.
The amplification of security concerns or escalation of geopolitical tensions may cloud oil importers’ tourism prospects, which have strengthened considerably in the past year. Intra- and interregional tensions in the region may also affect investor confidence and access to finance, such as through higher sovereign spreads.
Continued progress in reforms could face challenges to implementation. Among oil importers, potential social discontent about higher energy prices may lead to delayed implementation of fiscal adjustments. This issue may be further compounded by the high debt levels (in some cases exceeding 100 percent of GDP) among several economies in the region.
The loss of momentum in these reforms could negatively impact longer-term growth in the region.
On the upside, positive growth surprises in key advanced and emerging economy trading partners would provide an important support to growth in MENA.
Oil-importing economies in the Maghreb region are dependent on the Euro Area for trade, remittances, or financial flows. Stronger-thanexpected external demand could mitigate headwinds to growth associated with domestic policy uncertainty in smaller oil importers, or from potential spillovers associated with reduced FDI and remittance flows from GCC economies to oil importers.
Stronger-than-expected impacts from reconstruction programs and rising infrastructure investment in war-torn countries, such as Iraq, could lead to a sustained economic recovery. Associated spillover effects could unlock the potential for higher growth among other countries in the region.
This would also allow the restoration of access to health, water, or food (Devarajan and Mottaghi 2017a; World Bank 2018l) to these economies, and improve the conditions of neighboring host economies (e.g., Djibouti, Jordan, Lebanon) by providing more resources for public services for both host residents and refugees (Devarajan and Mottaghi 2017b).
Source: World Bank.
Emerging Markets have suffered in recent years due to low commodities prices and slower global demand. With signs that emerging markets were on the comeback trail in 2017, many analysts earlier this year believed that 2018 would be much brighter for Emerging Markets, however, there are signs that tailwinds are fading. The IMF said in its latest World Economic Outlook that this year and next, "growth in emerging market and developing economies will rise before leveling off.”
Our economists believe that there is a growing divergence between developed and developing economies. Among developing nations with economies with relatively solid fundamentals and driven by commodity exports—especially oil—growth is accelerating this year going into next. However, higher yields in the United States, the rise in energy prices and large exposure to foreign debt are putting pressure on some oil-importing countries and those with persistent macroeconomic imbalances. This mostly results in heightened volatility in their financial and equity markets, as well as sizeable currency depreciations. Let’s take a closer look at what’s expected for some of these countries in the coming year:
China
Global and domestic headwinds are expected to impact growth in H2 and beyond. The brewing full-blown trade war between China and the United States is the main downside risk to the country’s economic outlook. Domestic threats, however, including a cooling property market and financial deleveraging, are also building. FocusEconomics panelists forecast the economy will grow 6.5% in 2018, which is unchanged from last month’s forecast. In 2019, the economy is seen expanding 6.3%.
India
A normalization in cash conditions following the demonetization of late 2016 and the fading of disruptions from last year’s launch of the Goods and Services Tax should facilitate the economic recovery in FY 2018. Nonetheless, risks of fiscal slippage in the run-up to elections next year, concerns over the banking sector in India, increasing global trade tensions and higher oil prices all cloud prospects. Our panel expects GDP growth of 7.3% in FY 2018, which is unchanged from last month’s estimate, and 7.5% in FY 2019.
Russia
Growth in Russia is expected to pick up this year, thanks to strengthening private consumption and firmer oil prices. An improving labor market and low inflation should buoy household spending, while higher commodity prices will support export growth. That said, high geopolitical uncertainty and the possibility of further economic sanctions remain key risks to the outlook. FocusEconomics Consensus Forecast panelists see GDP expanding 1.7% in 2018, which is unchanged from last month’s forecast. In 2019, growth is seen steady at 1.7%.
Brazil
Brazil’s growth forecast was chopped for a third consecutive month as the truckers’ strike, a less supportive global backdrop and higher oil prices dent the country’s outlook. FocusEconomics panelists now see the Brazilian economy growing 1.7% this year, down 0.2 percentage points from last month’s forecast. A market-friendly outcome to October’s election remains critical to ensuring a sustainable recovery; however, this is far from certain. Next year, GDP is seen growing 2.5%.
Mexico
Household spending and exports are expected to drive growth this year in Mexico. Tight job markets—both domestically and stateside—and improved private-sector lending should support private consumption, while healthy factory output in the U.S. should bolster manufacturing exports. Uncertainty over NAFTA continues to weigh heavily on investment prospects, although the odds of reaching a deal have improved in recent weeks. On politics, most analysts currently expect AMLO to govern as a centrist. FocusEconomics panelists expect growth of 2.2% in 2018, down 0.1 percentage points from last month’s estimate. For 2019, panelists see growth stable at 2.2%.
Argentina
Despite a healthy first quarter, the pace of growth is expected to slow sharply this year. The loss of agricultural output following the severe drought; extremely high interest rates and currency volatility, which will weigh on investment decisions; and consumer spending constrained by low confidence and rapid inflation are seen driving this deceleration. Panelists participating in the LatinFocus Consensus Forecast foresee the economy expanding 0.4% in 2018, down 0.5 percentage points from last month’s forecast. For 2019, growth is expected to reach 1.9%.
Turkey
Economic growth in Turkey will likely weaken in the coming quarters, on tighter financial conditions, shaky investor sentiment and a higher oil import bill. Exchange rate volatility, geopolitical tensions, a gaping current account deficit and elevated inflation pose downside risks. FocusEconomics panelists expect growth of 4.2% this year, which is unchanged from last month’s estimate. They see growth of 3.5% in 2019.
Romania
Higher inflation and a loss in consumer confidence should lead to a marked slowdown in consumer spending this year, denting GDP growth in Romania. Although the expansion in fixed investment should gain some strength, low EU funds absorption will limit the extent of the acceleration. Downside risks stem from widening fiscal and current account deficits. FocusEconomics panelists expect growth of 4.1% for 2018, down 0.1 percentage points from last month’s forecast, and 3.6% in 2019.
Egypt
The Egyptian economy is expected to grow at a solid pace in FY 2019. This is due to higher investment on the back of increased government spending and an improved regulatory environment. Moreover, the external sector should continue to benefit from the weaker pound. However, large fiscal imbalances and the higher price of oil will weigh on prospects. FocusEconomics panelists expect GDP to expand 5.1% in FY 2019, which is unchanged from last month’s forecast, and 4.9% in FY 2020.
South Africa
Greater political stability and firm credit ratings bode well for the South African economy in 2018 as full-year economic prospects look set to largely ride out the weak first quarter. Real wage gains should support stronger household spending this year, while the government’s push to attract investment should bolster capital outlays. Nevertheless, fiscal slippage and a slow reform agenda are likely to constrain growth over the medium term. FocusEconomics analysts expect growth of 1.6% in 2018, down 0.3 percentage points from last month’s forecast, and 2.0% in 2019.
Nigeria
Higher oil prices, improved liquidity and increased public spending in the run-up to the 2019 elections should fuel faster growth this year in Nigeria. However, political uncertainty, as well as security concerns, continues to pose risks to economic activity. FocusEconomics panelists expect GDP to increase 2.4% in 2018, which is down 0.1 percentage points from last year’s projection. Next year, growth is seen rising to 2.9%.
These 4 Business Trends Will Have a Major Impact In 2019 -- Watch Them Closely
01 Jan 2019 Written by Admin AdminYou've likely experienced your fair share of ups and downs throughout 2018, so to minimize the "downs" side of the equation and lead your team in the right direction in 2019, think about starting to prepare now.
While setting some New Year’s resolutions on how to improve your leadership skills will certainly help stimulate better results in the future, it's equally essential that you monitor the trends that could affect your industry -- and the business world as a whole -- in 2019.
Thankfully, you won’t have to depend on guesswork to know what changes could be coming your way because there are specific business trends that experts have described. Here are four of the biggest to keep your eye on:
1. Increasingly diverse payment options are coming.
The seemingly countless headlines about Bitcoin and blockchain may no longer be as prominent as they were at the beginning of 2018, but they've illustrated an important trend unlikely to go away: Customers are looking for more flexible banking models and payment methods.
Speed and security are a big part of the equation, which is why the ABA Banking Journal predicts that contactless credit card payments will become an important trend in brick and mortar transactions. Allowing customers to tap or wave a card at a payment terminal to quickly process a transaction falls perfectly in line with the norms of digital shopping.
Of course, many customers don’t want businesses to merely adopt new credit card technology. Enabling your company to also accept non-traditional payment methods -- be they through applications like Paypal or alternative funds like Bitcoin -- could also prove key to winning new customers in the new year.
2. It’s time to embrace AI.
Artificial intelligence (AI) really started to enter the mainstream in 2018, with chatbots and virtual assistants making their presence felt in a wide range of industries.
Each of these advances is designed to improve the customer experience or streamline business operations, and all of them could have a big impact on your bottom line as customers become more and more comfortable with AI.
In a phone interview, Omer Khan, founder and CEO of VividTech, explained to me that, “Today’s chatbots and virtual assistants are able to handle more customer service tasks than ever before to better facilitate the customer journey. As they utilize machine learning to better respond to customer requests, these interactions become even more efficient.
"We’re also seeing chatbots that integrate the brand personality to further streamline these online conversations and improve company results," Khan said.
Though not every AI application may be necessary for your particular business, it's important that you analyze the options that are out there and consider how they could improve your processes and services.
3. The shipping wars will continue.
The priority customers assign to shipping that's free and fast is bigger than ever before — and that’s not going away any time soon. Amazon, Walmart and Target all entered a major Black Friday battle in an effort to sway customers with superior shipping deals.
Other major retailers like Home Depot, Best Buy and Nordstrom are also trying to improve their free shipping options. Direct-to-consumer ecommerce brands will soon be focused on more than just transit time. Maintaining brand quality, owning customer data and improving the entire shipping experience will also prove essential.
In fact, customers are placing an increasing value on free, fast shipping. Nearly 60 percent of shoppers in one Alix Partners study agreed that they “browse for products based on their preferred shipping options.” Some were even willing to spend more on an individual product if free shipping is available.
For ecommerce businesses, adjusting the product lineup isn’t going to be enough to win new customers. Providing a faster, more streamlined delivery process could prove a key differentiator for building your brand.
4. The gig economy and remote work are here to stay.
The Fed has estimated that as many as 75 million Americans participate in the gig economy in some way. Our increasingly digital and decentralized world has also created more opportunities for people to launch their own business ventures. These trends have led to a sharp increase in remote work, with over 43 percent of employees, according to a Gallup survey, working at least part of the time from home.
Though the gig economy may not have had much of an impact on your industry yet, there’s no denying that shifting priorities in employment will continue to make a difference in the workplace.
For one thing, employees are placing more value than ever before on having a flexible work environment that allows them to spend more time out of the office. Adapting company policies to allow for remote work could help improve employee retention, but it must be managed appropriately to keep productivity at appropriate levels.
Finding the right balance for achieving flexibility and high-quality results will prove crucial as businesses try to keep their best and brightest from jumping into the gig economy.
Ring in 2019 the right way!
As this list illustrates, new business trends are poised to disrupt everything from marketing to employee management. Is your business prepared to handle the challenges ahead?
By doing your research now, you can better identify how to successfully incorporate these changes into your business model so the competition doesn't leave you behind.
Source: Entrepreneurship Middle East
While selecting an investment avenue, you have to match your own risk profile with the risks associated with the product before investing.
Most investors want to make investments in such a way that they get sky-high returns as fast as possible without the risk of losing the principal amount.
And this is the reason why many investors are always on the lookout for top investment plans where they can double their money in few months or years with little or no risk.
However, it is a fact that investment products that give high returns with low risk do not exist. In reality, risk and returns are inversely related, i. .. higher the returns, higher is the risk, and vice versa.
So, while selecting an investment avenue, you have to match your own risk profile with the risks associated with the product before investing. There are some investments that carry high risk but have the potential to generate high inflation-adjusted returns than other asset class in the long term while some investments come with low-risk and therefore lower returns.
There are two buckets that investment products fall into - financial and non-financial assets. Financial assets can be divided into market-linked products (like stocks and mutual funds) and fixed income products (like Public Provident Fund, bank fixed deposits). Non-financial assets - most Indians invest via this mode - are the likes of gold and real estate.
Here is a look at the top 10 investment avenues Indians look at while savings for their financial goals.
1. Direct equity
Investing in stocks may not be everyone's cup of tea as it's a volatile asset class and there is no guarantee of returns. Further, not only is it difficult to pick the right stock, timing your entry and exit is also not easy. The only silver lining is that over long periods, equity has been able to deliver higher than inflation-adjusted returns compared to all other asset classes.
At the same time, the risk of losing a considerable portion of capital is high unless one opts for stop-loss method to curtail losses. In stop-loss, one places an advance order to sell a stock at a specific price. To reduce the risk to certain extent, you could diversify across sectors and market capitalisations. Currently, the 1-, 3-, 5 year market returns are around 13 percent, 8 percent and 12.5 percent, respectively. To invest in direct equities, one needs to open a demat account.
2. Equity mutual funds
Equity mutual funds predominantly invest in equity stocks. As per current Securities and Exchange Board of India (Sebi) Mutual Fund Regulations, an equity mutual fund scheme must invest at least 65 percent of its assets in equities and equity-related instruments. An equity fund can be actively managed or passively managed. In an actively traded fund, the returns are largely dependent on a fund manager's ability to generate returns. Index funds and exchange-traded fund (ETFs) are passively managed, and these track the underlying index. Equity schemes are categorised according to market-capitalisation or the sectors in which they invest. They are also categorised by whether they are domestic (investing in stocks of only Indian companies) or international (investing in stocks of overseas companies). Currently, the 1-, 3-, 5-year market return is around 15 percent, 15 percent, and 20 percent, respectively. Read more about equity mutual funds.
3. Debt mutual funds
Debt funds are ideal for investors who want steady returns. They are are less volatile and, hence, less risky compared to equity funds. Debt mutual funds primarily invest in fixed-interest generating securities like corporate bonds, government securities, treasury bills, commercial paper and other money market instruments. Currently, the 1-, 3-, 5-year market return is around 6.5 percent, 8 percent, and 7.5 percent, respectively.
4. National Pension System (NPS)
The National Pension System (NPS) is a long term retirement - focused investment product managed by the Pension Fund Regulatory and Development Authority (PFRDA). The minimum annual (April-March) contribution for an NPS Tier-1 account to remain active has been reduced from Rs 6,000 to Rs 1,000. It is a mix of equity, fixed deposits, corporate bonds, liquid funds and government funds, among others. Based on your risk appetite, you can decide how much of your money can be invested in equities through NPS. Currently, the 1-,3-,5-year market return for Fund option E is around 9.5 percent, 8.5 percent, and 11 percent, respectively.
5. Public Provident Fund (PPF)
The Public Provident Fund (PPF) is one product a lot of people turn to. Since the PPF has a long tenure of 15 years, the impact of compounding of tax-free interest is huge, especially in the later years. Further, since the interest earned and the principal invested is backed by sovereign guarantee, it makes it a safe investment. Read more about PPF.
6. Bank fixed deposit (FD)
A bank fixed deposit (FD) is a safe choice for investing in India. Under the deposit insurance and credit guarantee corporation (DICGC) rules, each depositor in a bank is insured up to a maximum of Rs 1 lakh for both principal and interest amount. As per the need, one may opt for monthly, quarterly, half-yearly, yearly or cumulative interest option in them. The interest rate earned is added to one's income and is taxed as per one's income slab. Read more about bank fixed deposit.
7. Senior Citizens' Saving Scheme (SCSS)
Probably the first choice of most retirees, the Senior Citizens' Saving Scheme (SCSS) is a must-have in their investment portfolios. As the name suggests, only senior citizens or early retirees can invest in this scheme. SCSS can be availed from a post office or a bank by anyone above 60. SCSS has a five-year tenure, which can be further extended by three years once the scheme matures. Currently, the interest rate that can be earned on SCSS is 8.3 per cent per annum, payable quarterly and is fully taxable. The upper investment limit is Rs 15 lakh, and one may open more than one account. Read more about Senior Citizens' Saving Scheme.
8. RBI Taxable Bonds
The government has replaced the erstwhile 8 percent Savings (Taxable) Bonds 2003 with the 7.75 per cent Savings (Taxable) Bonds. These bonds come with a tenure of 7 years. The bonds may be issued in demat form and credited to the Bond Ledger Account (BLA) of the investor and a Certificate of Holding is given to the investor as proof of investment. Read more about RBI Taxable Bonds.
9. Real Estate
The house that you live in is for self-consumption and should never be considered as an investment. If you do not intend to live in it, the second property you buy can be your investment.
The location of the property is the single most important factor that will determine the value of your property and also the rental that it can earn. Investments in real estate deliver returns in two ways - capital appreciation and rentals. However, unlike other asset classes, real estate is highly illiquid. The other big risk is with getting the necessary regulatory approvals, which has largely been addressed after coming of the real estate regulator. Read more about real estate.
10. Gold
Possessing gold in the form of jewellery has its own concerns like safety and high cost. Then there's the 'making charges', which typically range between 6-14 per cent of the cost of gold (and may go as high as 25 percent in case of special designs). For those who would want to buy gold coins, there's still an option. One can also buy ingeniously minted coins. An alternate way of owning paper gold in a more cost-effective manner is through gold ETFs. Such investment (buying and selling) happens on a stock exchange (NSE or BSE) with gold as the underlying asset. Investing in Sovereign Gold Bonds is another option to own paper-gold. Read more about sovereign gold bonds.
What you should do
Some of the above investments are fixed-income while others are market-linked. Both fixed-income and market-linked investments have a role to plan in the process of wealth creation. While market-linked investments help in navigating the volatility and in the process generate high real return, the fixed income investments help in preserving the accumulated wealth so as to meet the desired goal. For long-term goals, it is important to make the best use of both worlds. Have a judicious mix of investments keeping risk, taxation and time horizon in mind.
Source: The Economic Times
'Innovation' is Hot, Hot, Hot! Expect More of It in the Small Business Sector in 2019.
01 Jan 2019 Written by Admin AdminThis past year, 2018, has been a very good one for innovation. We've seen the blockchain boom, the increase in low-code and no-code app development, the start of the rollout of 5G technology and AI and AR: All came into their own with countless programs and applications for both business and consumer life.
On the coattails of such a year, I believe that 2019 has the opportunity to show even more promise. Here are the trends I predict we will see in small businesses and across the industry as a whole:
University technology transfers will become an integral part of the startup community.
The innovation economy is always looking ahead toward “the next big thing.” It should come as no surprise, then, that often the new generation of the best and brightest can be found in colleges and universities across the country.
The spark for this was the 1980 Bayh-Doyle Act, which enabled universities, nonprofit research institutions and small businesses to own, patent and commercialize inventions developed under federally funded research programs within their organizations. As a result, corporations and investors in the years since have been turning to colleges for research and development.
Gatorade, Facebook, Remicade: No shortage of household names have come out of college and university research and development. In fact, according to an infographic from AUTM, from 1996 to 2015, tech transfer supported 4.3 million jobs, forming 11,000-plus startups.
Examples? My own company, Sports Engineering Inc., partnered with Worcester Polytechnic Institute to create a unique sole technology, Orca Pharmaceuticals. AstraZeneca announced a partnership with New York University to develop novel drugs for autoimmune disease. The Northwestern University spin-off Naurex Inc. was acquired by Allergan. And there are more ...
Technology will become more prevalent in everyday consumer products.
According to Consumer Technology Association, the U.S. consumer technology sector is set to reach a record $351 billion in retail revenues in 2018. “Technology is improving our lives in more ways than ever -- and consumer enthusiasm is growing just as quickly as companies can bring their innovations to market,” Gary Shapiro, president and CEO of CTA, told BusinessWire.
In 2019, I believe that technology will embed itself even further in our everyday lives -- often without our even noticing.
Fitness, for example, will continue its shift from scheduled studio classes and gyms to on-demand apps and streaming services, which are already part of the $30 billion live-streaming industry (projected by MarketsandMarkets research to grow to $70 billion by 2021). Technology advancements to promote safety among professional and amateur athletes will also increase, whether through the technology in a ZERO1 football helmet designed to reduce concussions, or in the sole of a sneaker aimed at minimizing ACL and ankle injuries.
Even our pets will get into the game, with Amazon expected to launch a pet tracker that can be attached to a dog or cat collar. This will be part of a wide trend for pet-specific technology products, which already represent a huge market, given the more than 1.5 billion dogs and cats worldwide.
“Work” will change, both in terms of how we show up and who's there when we do.
As startups look to cut costs and keep employees happy, the traditional office model will continue to evolve. In fact, 70 percent of professionals globally already work remotely at least once a week, according to a recent report by IWG.
Add to this the fact that a recent study, led by Stanford economics professor Nicholas Bloom and his graduate student James Liang, demonstrated that remote workers they surveyed were not only happier, but also more efficient: You can see a clear argument for a new model.
Additionally, the remote office model also allows companies with the increased freedom to pursue the talent they desire, rather than restricting themselves to only a handful of candidates in their local area. I believe that this is actually part of an even larger trend -- whereby companies will use different methods to measure the "desirability" of a candidate, and it won’t always be the obvious.
As Jeremy Auger, co-founder and chief strategy officer at D2L told Inc., “The rise of A.I. and automation means employees are increasingly tasked with jobs that only humans can do: thinking creatively, using judgment, employing empathy, etc. Adaptability will be the most durable skill in the years to come, as the ability to learn and adjust becomes more important than any one skill.”
Further, a “traditional” education won't be as necessary, due to the rise of coding boot camps and other intensive programs that provide students with skills that are immediately applicable for the workspace. These new education models are comprised largely of adults -- people who either chose majors that didn’t funnel into a good career path or recognized that they weren’t qualified for the job they wanted.
These people then returned to school in a non-traditional way to obtain skills, thus joining the other pioneers out there in the new-collar work force.
Cryptocurrency will no longer be the “Wild West.”
Regulation can be difficult when it comes to just about any emerging technology. After all, when something hasn’t existed before, how can you possibly control it? In 2019, however, that is going to change. While crypto's trading volume will likely grow by over 50 percent in 2019, according to a Satis Group prediction, it will also become far more regulated. The Financial Action Task Force (FATF) announced that it will get one step closer to creating international standards for cryptocurrency when it launches its first set of rules in June of 2019.
Some people say such regulation is overdue: A report by the Wall Street Journal in September said that nearly $90 million worth of criminal proceeds had gone through crypto intermediaries in the previous two-year period. According to the WSJ analysis, which it said included only “a narrow slice of suspected criminal behavior,” $88.6 million worth of funds was laundered via 46 exchanges.
According to Reuters, jurisdictions around the world will be required to license and regulate cryptocurrency exchanges, as well as select firms providing encrypted wallets, and firms providing financial services for ICOs.
One thing is clear: With these regulatory improvements coming down the pike, cryptocurrency and the inovation it introduces to all sorts of transactions will be here to stay.
And as entrepreneurs look to the year ahead, innovation, evolution and regulation will serve as the three major themes to carry small businesses and startups forward into 2019.
Source: Entrepreneurship Middle East
More than 100 UHNWIs and family office investors at Prestel & Partner’s 4th Dubai Family Office Forum
27 Dec 2018 Written by Admin SAE
115 UHNWIs, family offices, wealth managers to gain knowledge from industry-leading experts on the evolving global wealth market trends
Press Release
28 December 2018, Dubai, UAE: The Dubai Family Office Forum will reveal investment trends as it holds its 4th edition on 5-6 February 2019 at The Palace Downtown in Dubai, United Arab Emirates. Around 115 ultra-high net-worth individuals (UHNWIs), family office investors and business leaders across MENA will benefit from relevant insights shared by thought leaders, analyses on case studies, and roundtable discussions.
The exclusive annual Dubai forum, which represents more than $2 trillion in investor wealth, will be an ideal platform to explore best practices in family governance and investments. The forum will also highlight impact themes and discussions which will be led by more than 40 renowned international thought leaders, family office principals, and global industry experts.
Prestel & Partner, the global leader in family office forums, is organizing the event in Dubai with topics and investment agenda specific to the interests and concerns of UHNWIs and family offices based in MENA region. Katja Muelheim, managing partner, Prestel & Partner, said, “We are so honoured to be back in Dubai once again and to always receive such a warm welcome. Our Family Office Forums have earned such a good reputation internationally and we are proud that the families attending find these forums so interesting and informative.”
Prestel and Partner has been hosting six other successful international private forum each year, specifically, in Singapore, Wiesbaden, San Francisco, London, and Zurich. Each forum is widely attended by UHNWIs and family offices which by Prestel and Partner’s definition should have a minimum of £150 million in assets from only one or few owners, and a family office works for these families and not as a solution provider to many third parties.
The forum is exclusively designed for family principals and family members, C-suite family office executives of single and private multi-family offices, UHNWIs, and private investors. Family offices and private investors who have nothing to sell attend for free.
Those who offer relevant products or solutions may attend by purchasing one of the limited tickets. Only a few commercial multi-family offices, family office advisors, and industry-leading solution/service provider firms are allowed to join and enrich the conversations with their topical expertise. To purchase such a ticket or to register your interest as a sponsor may send an email to This email address is being protected from spambots. You need JavaScript enabled to view it..
Host country UAE, according to Global Wealth Migration Review, is home to 1,660 ultra-millionaires with net fortune of at least $30 million and 240 individuals with net worth exceeding $100 million. As most countries in GCC are focusing on diversifying their economy, UHNWIs are likewise intent to grow their portfolio while paying particular attention to succession planning and transition of wealth.
Tobias Prestel, managing partner, Prestel and Partner, said that these issues come with relevancy and thus would be a significant part of the forum. “Our leading experts will discuss a sustainable future and co-investments between families, in addition to investments in healthcare and real estate. It’s an ever-changing focus and we are looking forward to welcoming so many prestigious families from MENA region to join us once again.”
Family Office Forum Dubai is ably supported by the UAE Ministry of Economy and Strategic Marketing and Exhibition, a leading exhibitions company based in Dubai. The forum offers free registration to family offices and UHNWIs. For online registration, visit www.prestelandpartner.com. For inquiries and partnership opportunities, send email to This email address is being protected from spambots. You need JavaScript enabled to view it. or call +44(0) 20 339 71390.
Editor’s Note:
- The Family Office Forum Dubai is the annual meeting place of genuine family offices from the MENA region held in English.
- The Family Office Forum Dubai has a simple formula: more family officers and principals on stage than solution providers; ore family officers and principals in the audience than solution providers; and, top family offices, principals and CIOs from the Middle East and beyond are attending.
For press inquiry, kindly call or email:
Shereen Hassan Al Musalami
Media and PR Manager, Strategic Marketing & Exhibitions
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.
Mobile number: +971 56 4034071
Tel : +971 4 392 3232
PO Box: 10161, Dubai, UAE
