UAE pri­vate sec­tor risk tol­er­ance on the rise

The Pak Banker - - Company& -

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

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