Saudi Arabia’s business community remains the most confident in the region with an index score of 91.6, while the UAE business confidence is at a new low at 69.8 clearly influenced by Dubai’s debt issues, said a new survey by HSBC.
The levels of confidence among Kuwait business people too soared in the fourth quarter of 2009 but in Bahrain and Oman the confidence levels declined slightly, according to the survey published by HSBC, the global associate bank of SABB.
HSBC’s quarterly ‘Gulf Business Confidence Index’ fell from 81.4 to 80.2 between the third and fourth quarters of 2009.
While this change is small, it masks a more complex regional picture: Saudi’s index rose marginally from 91.5 to 91.6, while Kuwait’s rose from 83.1 to 84.6. The UAE by contrast declined from 72.2 to 69.8 in the fourth quarter, the survey said.
The main trend of business sentiment over the last three quarters is becoming slowly more confident, although it remains a long way below the exuberant mood of 2007 and early 2008, the survey added.
Simon Vaughan Johnson, HSBC’s head of Commercial Banking for Mena region, said the confidence was on the rise in the hydrocarbon-producing states of Saudi, Qatar and Kuwait, ‘while the UAE’s score was clearly heavily influenced by Dubai’s well-publicised debt issues.’
The first quarter of 2009 registered an Index score of 70.9, so the year has seen a bounce of over 10 points in the Index, he pointed out.
‘We are seeing a slight dip in confidence levels quarter on quarter across the board, but we have not returned to the lows seen earlier in 2009. If I were to characterize the mood of the region’s business people, I would say they are cautiously realistic,’ Johnson remarked.
‘The year 2009 was a difficult one for the GCC economies, and there is a feeling that 2010 will be a year of improvement, tempered by a realism of expectation,’ he added