Abu Dhabi targets IPO frenzy ahead of Saudi Aramco

in Abu Dhabi have been told to manage budgets efficiently and control spending and possibly raise their own finances for expansion to make them less reliant on the state, a source close to the government said.

“Abu Dhabi is taking bold measures to kickstart the markets and boost investor confidence by pushing government-related entities to sell shares and list publicly,” said an Abu Dhabi-based senior bank executive who has advised on deals there.

At the same time, Abu Dhabibased companies spanning sectors such as banking, insurance, services and health care are also expected to go through more consolidation, the sources said.

Last year Abu Dhabi merged its two sovereign wealth funds, Mubadala and IPIC, while National Bank of Abu Dhabi and First Gulf Bank created one of the largest banks in the Middle East and Africa.

“When we were a very young country, you could have multiple companies and you basically had to grab your domestic market share. Now it’s time to reach the size where we need to export our services, export our business,” said Sabah Al-Binali, a UAE-based investor.

Abu Dhabi is using tougher economic conditions to push through reforms that would have been harder to implement in previous years, when higher oil prices boosted its revenue.

“The good old days of the state bearing the weight of spending and providing subsidies because of rich resources is over. That model is outdated,” an Abu Dhabi-based banker said.

“The private sector has to bear the burden too now, something Abu Dhabi has realized.”