UAE private sector risk tolerance on the rise
DUBAI: The increasing risk appetite among banks and corporate in the Middle East is expected to speed up the recovery process in the region according to corporate treasury heads and bankers.
According to the latest Deloitte global CFO (chief financial officer) survey, Middle East CFOs are much more optimistic compared to CFOs in the West. Although the general level of optimism dipped slightly, from 55 per cent to 52 per cent compared to the first quarter survey, this is still quite high compared to the general level of optimism among CFOs of Western countries such as the UK and North America.
"This feeling of optimism is reflected in the region generally with plans for growth moving ahead and GDP expected to continue to increase in the coming year," said James Babb, partner and CFO Programme Leader for Deloitte. "This positive climate is being supported by strong spending on infrastructure development from the region's governments, underpinned by resilient oil prices."
Huge infrastructure projects sent Saudi spending soaring this year but high crude prices ensured a solid 17-per cent surplus for the oil giant, the finance ministry said last week. Annual revenue for the world's largest supplier of oil was projected to hit 735 billion riyals (Dh719.98 billion) by December 31, compared to expenditures of 626.5 billion riyals.
The government originally budgeted spending of 540 billion riyals, with an anticipated shortfall of 70 billion riyals. But with oil prices above $70 a barrel for most of last year against the budget's conservative projection of about $50 per barrel, Riyadh has a huge cushion to keep pushing its 20092014 development programme worth more than $700 billion. "The government expanded by an astonishing 5.9 per cent .Nobody forecast it. -PB News