UAE cos optimistic about returning to pre-Covid profitability

7 December, 2020 12:00 AM printer

DUBAI: UAE companies are more optimistic than their global peers about returning to pre-Covid profitability levels in the next two years, according to the latest survey from HSBC.

About 90 per cent of UAE companies expect to return to profitability by the end of 2022 compared with the global average of 81 per cent, report agencies.

However, 18 per cent of UAE respondents expect to reach profitability as soon as the end of this year, the HSBC Navigator survey showed.

“UAE companies have always been resilient and innovative,” Daniel Howlett, HSBC’s regional head of commercial banking, Middle East, North Africa and Turkey said.

“Despite the slowdown during the pandemic, business is slowly returning to pre-Covid levels and companies are finding ways to maximise their potential, adapt to the new environment and really focus on sustainable measures that will help their companies grow and be able to future-proof them from unexpected disruptions.”

HSBC Navigator draws from a survey of more than 10,368 companies in 39 markets, including 151 companies in the UAE and another 560 in the wider Middle East, North Africa and Turkey region, making it the largest survey of its kind.

The study gauges sentiment and expectations of businesses in the near to mid-term on topics ranging from business outlook to future strategy to international trade, supply chains and sustainability.

The UAE was one of the first countries in the region to roll out stimulus packages to support businesses in the wake of the coronavirus pandemic that has devastated the global economy. Last month, the Central Bank of the UAE extended its Dh50 billion ($13.61bn) Targeted Economic Support Scheme to June 30 next year in an effort to continue supporting the economy.

The UAE will be the fastest country in the world to recover from the Covid-19 pandemic and will begin to rebound next year, Sheikh Mohammed bin Rashid, the Vice President and Ruler of Dubai, said on Saturday.

More than 80 per cent of UAE businesses will increase their investments next year compared with 67 per cent globally, according to the survey. The three most commonly cited investment priorities are product and process innovation, marketing and customer experience.

While 74 per cent of businesses from the UAE feel that international trade has become more difficult due to the impact of events over the past year, their commitment to pursuing international opportunities, however, “appears undiminished”,