UAE- Economic visions to increase competition among GCC coun...| MENAFN.COM

Wednesday, 07 December 2022 12:13 GMT

UAE- Economic visions to increase competition among GCC countries: Experts


(MENAFN- Khaleej Times) Dubai - The economic visions announced by the GCC governments will increase competition among the regional countries, diversify their economies and lower dependency on oil, panelists said during at a conference in Dubai on Wednesday.

Citing an example of Saudi Arabia about liberalizing the free zones, tourism, entertainment and trade sectors under vision 2030, Dr. Fahad Alturki, chief economist and head of research, Jadwa Investment Company, said that these measures will result in increased competition and force the countries to be more creative rather than depending on the petrodollars.

He noted that trade between the GCC is minimal and most of it is re-export and that is mainly due to the UAE's strong port infrastructure, hence helps it to re-exports to Iran, Africa other countries too.

"If the countries get their plan implemented under their respective visions, there will be more competition in attracting investments," he said.

The UAE has announced vision 2021, Oman 2020, Bahrain and Saudi Arabia 2030 as they look to reduce dependence on oil following the consistently lower crude prices over the last couple of years.

Though Saudi oil sector witnessed decline in first-half of 2017, the non-oil recorded marginal growth of 0.5 per cent, he said, adding that "next year, we will not see non-oil sector growth of 5 per cent achieved a few years back but will be around 1 per cent."

Alturki was speaking during a panel discussion on the first day at the CFO Strategies Forum Mena held at JW Marriott Marquis Hotel on Wednesday. Among the other panelists were Jignesh Sanghvi, CFO, Dubai Multicommodities Centre (DMCC); Lindsay Degouve De Nuncques, head of ACCA Middle East; and Dr. Martin Spraggon, professor of strategic management, American University of Sharjah.

Commenting on the oil prices, Alturki said that it will drop from the current $60 per barrel with Brent averaging $53 this year and between $55 to $60 in 2018.

"It is hard to predict oil price as shale production is expected to increase which might push prices lower while inventories are expected to drop and could push oil higher. Then there is geopolitical situation also to watch for," he added.

Jignesh Sanghvi of DMCC said that the regional governments' vision is clear and that is to reduce the dependence on oil with more focus on infrastructure, trading hubs, factories and tourism.

"It's about expanding market rather than eating into each other's. We have seen synergies in the regional leadership. There is $22-billion trade between the UAE and Saudi and it's going to multiply if economies are going to open up," Sanghvi added.

During uncertain times, the businesses should look for opportunities, he said during the forum discussion on macro-economic outlook during uncertainty and on creating values.

"It's is not," he added, "about what is happening outside, but how firms and individuals respond to that. It is all about how you position yourself and plan strategy to deal with the situation."

Addressing the VAT challenges, Aly Rehan Khan, GCC VAT Trainer, Qadi Accountants, noted that it is crucial for businesses to clearly understand the subsequent impact of these changes on their organisations and prepare accordingly. VAT's impact goes beyond the accounting department and their processes.

Commenting on the value-added tax (VAT) in the UAE, Lindsay Degouve De Nuncques, Head of ACCA Middle East, said many businesses are not prepared as they think that the tax may not be implemented.

She noted that only 11 per cent of companies are prepared for VAT implementation.

"Key message is that if you're not prepared, you will be in sticky situation," she added.

Earlier in the day, Charlotte Chedeville, senior project manager, Naseba, gave opening remarks while Shane Phillips, CEO, TPG Leadership, gave the welcome address.

The world renowned guru John Mattone, who was also a coach of late Steve Jobs, also gave an impressive keynote on intelligent leadership.

Highlighting the role of robotics in the financial sector, Khurram Siddiqui, Partner, Mena Financial Accounting Advisory Services Digital Leader, EY, said software robotics are cousin of hardware robotics and former are more potent than the latter.

Pointing out advantages of robots over humans, he said they are low-risk, non-invasive, better accuracy, consistent, cost saving of 20-60 per cent.

"Productivity of people is going to be very high because you're taking repetitive work away from human and involving them more in decision-making. Robotics can work in any industry as well. For robots, there are no sick days, working 365-days a year, and then return on investments are very high, too."

Swami Natarajan, senior director and SaaS Leader, Oracle, said change is the new constant but what matters most is the ability of the executives of how to respond as large organizations are going through 'disruption'.

"From CFO perspective, new paradigm shift is happening from operational efficiency to operational agility."

Oreabetse Matlhare, Founding Partner, The Scalable CFO; Linda Luu, Founding Partner, The Scalable CFO; and Chris Fernandez, Founder and CEO, BlockGemini, discussed the explosive growth of "initial coin offerings" as a capital-raising tools using bitcoin and cryptocurrencies to fund projects.


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