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The fall in oil prices continues to hit the  Middle East hard.
The fall in oil prices continues to hit the  Middle East hard.

Mideast Business Confidence Drops

Mideast Business Confidence Drops

Business confidence in the Middle East Arab countries (Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Bahrain, and Oman) remained subdued in Q4 2016, with 51% of firms reporting that they feel less confident about the future, according to a report.
The latest Global Economic Conditions Survey from the Association of Chartered Certified Accountants and the Institute of Management Accountants suggests that the global business confidence has dropped in Q4 amid on-going political and economic uncertainty.
The uncertainties listed include:
— Government investment falling to its lowest level since the start of 2016, with many developed markets still firmly in austerity mode;
— Changes in the political landscape stemming from the recent US election;
— Uncertainty over US/China trade developments;
— Continued slump in oil prices and government spending reductions in Middle East. 
The survey of over 4,500 finance professionals and business leaders worldwide has found that while the economic outlook has improved slightly in the US and China over the last quarter, confidence in the Middle East remains subdued.
Almost half (44%) of global respondents expressed concern over falling income due to low levels of government expenditure, with another 43% reporting worsening business confidence.
Commenting on the findings, Lindsay Degouve de Nuncques, head of ACCA Middle East, said: “The fall in oil prices continues to hit the Middle East hard, creating sharp declines in export and fiscal revenues. This has caused many governments to cut back heavily on key spending projects.
“This is particularly noticeable in Saudi Arabia, where the weakness of the government spending index has been the main driver of falling confidence. With the need to stabilize finances as well as raising interest rates to keep up with the US Fed’s tight monetary policy is placing considerable pressure on state investment.”
Meanwhile, Middle East’s debt issuance reached $77.8 billion in 2016, a 145% increase compared to the value raised during 2015 and by far the highest annual total in the region since records began in 1980, said a report from Thomson Reuters, a leading source of intelligence information for businesses and professionals.
Middle Eastern investment banking fees reached $820.8 million during 2016, an 18% increase compared to fees recorded during 2015 and the highest annual fee total in the region since 2008, said the annual investment banking analysis for the Middle East region. The estimates are from Thomson Reuters/Freeman Consulting.

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