MENA business confidence rose in the second quarter of this year owing to strong oil prices and economic expansion in the UAE and Saudi Arabia, according to the Young Presidents Organization (YPO) Global Pulse CEO sentiment survey.
Confidence among business leaders in the region rose in the second quarter of this year placing MENA as the second most optimistic region in the world, the survey revealed.
While CEO sentiments suffered on the back of asset sell-offs in emerging economies during the second quarter, strong economic performance in UAE and Saudi compensated for the downturn in optimism elsewhere, the survey noted.
Regional sales forecasts also recorded a positive trend with CEOs sporting a bullish growth outlook. The YPO sales confidence index for MENA swelled to 69.5 in the second quarter, second only to Africa. Around 70 per cent of the CEOs surveyed expected to increase their revenues by at least 10 per cent in the next 12 months.
Capital spending plans too remained buoyant among CEOs with the fixed investment component of the index inching up. Around 55 per cent of CEOs surveyed said that they have plans to step up investments over the next 12 months.
Despite this positive sales and investment forecast, the employment outlook is bleaker.
According to the survey, businesses remain cautious about hiring as intentions to increase headcount have stayed within a narrow 1.8-point range.
“Needless to say, this is a turbulent time for the Middle East, with several countries experiencing socio-political upheaval at worst, and fragile economies at best,” said Ali Tabbara, managing director of UTC Nexia International and chair of YPO’s MENA region.
“At the same time, the region has real pockets of strength and a strong culture of intra-regional trade and investment that serve to buoy overall business confidence,” he added.
YPO, founded in 1950, is a not-for-profit, global network of young chief executives, established with the aim of bettering their leadership through exchange of ideas and education.