9 TH GCC BUSINESS CONFIDENCE AND GOVERNMENT REFORM SURVEY 2014

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1 9 TH GCC BUSINESS CONFIDENCE AND GOVERNMENT REFORM SURVEY 2014 SNAPSHOTS FOR FT/OW FORUM FEBRUARY 2014 Oliver Wyman

2 Survey objectives and methodology What does this poll provide? Provides a snapshot view of on-the-ground issues Benchmarks and compares across the region Creates a time series to gauge trends and progress (since May 2009) Who did we survey? 200 senior private and public company executives (CEO, CFO, COO, CSO, etc.) Across four countries: UAE, KSA, Qatar and Kuwait Across multiple industries January 2014 (with follow-up interviews) Oliver Wyman 1

3 Business confidence The UAE is the most optimistic about business conditions in the GCC, while KSA, Qatar, and Kuwait tend to be more pessimistic What is your view of the current business conditions in your country versus what they were a year ago? 75% Improved No change Declined 55% 56% 38% 31% 21% 23% 22% 20% 24% 24% 4% UAE KSA Qatar Kuwait Note: Sample size of 200 for the region. Not started or Not Sure responses not shown in graph Oliver Wyman 2

4 Business confidence Over the last two years executives in the UAE have grown more upbeat, while those in KSA and Qatar have become less so What is your view of the current business conditions in your country versus what they were a year ago? Respondents agreeing situation has improved 87% 80% 75% 64% 57% 57% 53% 48% 80% 78% 79% 67% 64% 63% 60% 55% 46% 67% 78% 76% 71% 69% 60% 56% 40% 15% N/A UAE KSA Qatar Oct-09 May-10 Dec-10 Note: Sample size of 200 for the region. Not started or Not Sure responses not shown in graph May-11 Dec-11 May-12 Dec-12 May-13 Jan-14 Oliver Wyman 3

5 Global and Regional Drivers Macro-economic shocks and political unrest are seen as the biggest risks to business conditions What do you see as the biggest threat to business conditions in the GCC? 25% 26% 25% 7% 3% Outside macroeconomic shocks Political unrest within the GCC Political unrest elsewhere in MENA Regional tensions Terrorism Note: Sample size of 200 respondents for the region. Not started or Not Sure answers are excluded from the analysis Oliver Wyman 4

6 Global and Regional Drivers In general, business executives are more focused within their own country with the exception of the UAE Of the following, which do you think offers the best opportunity for growth for your company? 44% 44% 45% 44% UAE KSA Qatar Kuwait 29% 29% 28% 28% 20% 13% 10% 7% 5% 4% 7% 7% Increased investment in my country Increased investment in the GCC Increased investment in Developed Countries Increased Investments in Developing Countries Note: Sample size of 200 respondents for the region. Not started or Not Sure answers are excluded from the analysis Oliver Wyman 5

7 Business needs Talent is seen as one of the key concerns to future business growth How significant are each of the following risks to your business in the next 5 years? 52% Very significant 41% 34% Talent war Finding capital Existing infrastructure insufficient Note: Sample size of 200 respondents for the region. Not started or Not Sure answers are excluded from the analysis Oliver Wyman 6

8 Business needs Similarly, competitive pressure and leadership capabilities may be reducing the ability to implement transformation How important are each of the following obstacles to making large-scale changes in your company? 28% 27% 11% 11% 3% Competitive pressure preventing change Lack of leadership capabilities Lack of planning and organizational capabilities Note: Sample size of 200 respondents for the region. Not started or Not Sure answers are excluded from the analysis Risk averse company Very fast growth Oliver Wyman 7

9 Business needs Governance is key to change and the Board of Directors (BODs) are becoming increasing becoming more involved How has the role of BODs of companies in your country changed in the past three years? Where has the involvement of BODs increased the most? More involved Less involved Board scrutiny / approval of investments Significant increase 38% 55% Reporting requirements to the Board 33% 40% 40% Involvement in significant mgmt. changes 31% -8% -6% -5% Involvement in mgmt. compensation 19% UAE KSA Qatar 8th GCC Business Confidence And Government Reform Survey May 2013 Note: Sample size of 150 respondents for the region. Not started or Not Sure answers are excluded from the analysis. Oliver Wyman 8

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