Welcome back: How Dubai is reopening to tourists
Driving ahead: How Nissan is steering its regional strategy BD 2.10 KD 1.70 RO 2.10 SR 20 DHS 20
AU GU S T 2 02 0
Individuals redefining the economic landscape in the Gulf region
INDIAN LEADERS IN THE GCC
ISLAMIC ECONOMY BOOM: HOW THE GCC IS LEADING THE CHARGE
CONTENTS / AUGUST 2020
The Brief An insight into the news and trends shaping the region with perceptive commentary and analysis
Welcome back With Dubai having reopened to tourists, is the hospitality industry witnessing a turnaround?
Cover story: Influential Indians in the GCC The businessmen and visionaries who have made a mark in this region
August 2020 3
50 TH A N
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E A U
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CONTENTS / AUGUST 2020
32 Growing influence The Islamic economy is expanding its reach
“Beyond the sky is where our dreams start” - Sheikh Mohammed bin Rashid Al Maktoum, after the launch of the UAE’s Hope Probe to Mars
Nissan 2.0 p.64
Raising the stakes p.72
Editor-in-chief Obaid Humaid Al Tayer Managing partner and group editor Ian Fairservice
South Asia beckons p.76
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Cover: Ángel Monroy. Photo: Getty Images
Vol. 25. Issue 4. August 2020 Printed by Emirates Printing Press, Dubai
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SOURCE: NATIONAL CYBERSECURITY CENTRE 2019
ILLUSTRATION: GETTY IMAGES/MALTE MUELLER
Future Startups Social Education Aviation
The most used passwords worldwide after an analysis of breached accounts
Hereâ&#x20AC;&#x2122;s why undernutrition and obesity are directly impacting business in low- and middle-income countries p.12 gulfbusiness.com
August 2020 7
The Brief / Future COMMENT
Rehan Khan Managing consultant for BT and a writer of historical fiction
Remaining connected to lockdown habits
Employees should retain some of the positive habits they’ve acquired during the lockdown by creating a chain reaction of connections
8 August 2020
the next, connecting in a spiral of consumption. In fact this phenomenon, where obtaining a new possession often creates a spiral of consumption that leads to additional purchases, is known as the ‘Diderot Effect’. We recognise this, because we’ve all done it. You buy a new armchair and then question the compatibility of the sofa you already have in the living room. Or you buy a new dress and must acquire new shoes and earrings to go with it. In other words, there is a chain reaction of connections, with one leading to another.
ILLUSTRATION: GETTY IMAGES/PEACEFOO
he chief editor and co-founder of the Encyclopédie in the eighteenth century was the French philosopher Denis Diderot (1713–1784). Disowned by his father after he gave up a career in law to become a writer, he lived a bohemian poverty-soaked existence for most of his life. When it came time for his daughter to marry, he couldn’t afford to pay for her wedding. Upon hearing of his tribulations, Russian empress Catherine the Great, a long-time admirer of the Encyclopédie, offered to buy Diderot’s personal library for 50,000 francs and asked Diderot to become her personal librarian. He took up the offer and undertook the journey to Russia, although he didn’t like to travel. The new earnings not only enabled Diderot to finance his daughter’s wedding, but also purchase a scarlet robe for himself. He greatly loved this robe and soon realised that his other belongings, such as his chair, desk, rug, and other household items, looked out of place beside the lavish robe. He swapped his rug with one from Damascus. He decorated his home with expensive sculptures. He purchased a mirror to place above the mantel, and a superior kitchen table. He threw away his spartan straw chair for a plush Moroccan leather one. One purchase led to
The Brief / Economy Challenging future
Real GDP growth forecasts for 2020 (% change) IMF (Apr-20)
The same is true of habits and ways of working. It takes about one month for new work habits and routines to bed in. As many of us have been working at home for much longer, we’ve in that time acquired new habits, sometimes really positive ones. Perhaps we’ve taken to going for a quick walk during the day or doing a 15-minute-high-intensity workout between conference calls, or taking time to reflect in solitude as we have our morning cup of coffee. As we start to drag ourselves back into the office, many will be anxious not to lose some of these positive habits they’ve acquired during the lockdown.
AS WE START TO DRAG OURSELVES BACK INTO THE OFFICE, MANY WILL BE ANXIOUS NOT TO LOSE SOME OF THESE POSITIVE HABITS THEY’VE ACQUIRED DURING THE LOCKDOWN Business leaders need to be mindful of this if they want employees to be physically and mentally engaged upon returning to the office. One way in which employees themselves can take the lead in ensuring they don’t lose sight nor track of the good habits they’ve introduced into their routine, is to connect them together to existing habits, where one habit creates a chain reaction leading to another good habit. A sort of Diderot Effect, but a positive one. In a method developed by BJ Fogg as part of his Tiny Habits programme, he calls this idea of connecting one habit to the next ‘habit stacking’. It operates on a pretty straightforward premise – “After [current habit] I will do [new habit]”. For example, an employee who returns to the office can decide: “After I buy my cup of coffee each morning, I will sit quietly and reflect for five minutes.” Another habit stack might be: “After I complete my recurring two-hour video call on Tuesday, I will go to the gym for 30 minutes”; or “When I see a flight of stairs in my office, I will take them rather than using the lift”; or “When I next take a flight, I will offset my carbon by organising for a tree to be planted”. Obviously, you can tie more than two habits together. Ultimately, you are trying to establish a chain reaction of rules to guide your future behaviour. gulfbusiness.com
World Bank (Apr-20)
Average change vs Oct-19 forecasts
Egypt 3.7 2
0.2 -0.4 -2.3
SOURCE: IMF, WORLD BANK, PWC ANALYSIS
Arnab Das Global market strategist, EMEA, Invesco
A N A LY S I S
Tracing the pandemic’s economic pathway Recovering from the ‘great compression’ caused by Covid-19 is going to be a slow and uncertain process, led by epidemiological factors
Emerging problem Eight of the 10 most affected countries by the Covid-19 pandemic are emerging markets 1. US 2. Brazil 3. India 4. Russia 5. South Africa 6. Mexico 7. Peru 8. Chile 9. UK 10. Iran SOURCE: JOHNS HOPKINS UNIVERSITY
he key epidemiological data about the pandemic points to important, shared trends across countries, amid major differences in national experiences. The pandemic has followed an exponential trajectory – although at very different rates around the world. It is also clear that lockdowns have ‘flattened the curve’ of infections and fatalities in most major economies. So far, then, it seems a bad situation has improved. However, it seems unlikely that the pandemic’s steep rise will be followed by a peak and then a sudden and exponential decline in most countries. Indeed, while China’s data shows a sharp fall in cases and deaths, every other country seems to have experienced a plateau, then a gradual declining trend with ups and downs. Several Asian countries have even experienced secondary waves. Such epidemiological factors in turn may well slow the economic recovery. The good news is that the available information all suggests that most developed markets (DMs) should be able to withstand moderate secondary waves – assuming the virus does not mutate significantly and that other major new facts do not come August 2020 9
The Brief / Economy A N A LY S I S
ILLUSTRATION: GETTY IMAGES/DIDGASON
to light. Now that the first wave seems to be passing, there are reasons to think that capacity has been improved for personal protective equipment, testing, hospitals, and ventilators. All these factors suggest that a secondary wave should be lower and more manageable than the first. The not-so-good news is that the situation in many emerging markets (EMs) remains much more challenging. Testing, hospitalisation, and fiscal capacity are all significantly more constrained in most EMs compared to DMs, and the buildup of surge capacity for potential secondary waves is also more constrained. With greater congestion in urban areas and large extended-family households in rural areas, public health policy, social distancing and fiscal support are unlikely to improve these factors in any timeframe to help deal with the pandemic. That said, some EMs, such as India, South Africa and most of Africa and South Asia, have much younger average age structures and smaller cohorts of the elderly vulnerable. Fatality rates should prove significantly lower than in many DM countries. Epidemiological ‘scenario uncertainty’ persists. Different models argue for different policies: those predicated on rapid spread and potentially high fatalities, called for very strict lockdowns initially and for
10 August 2020
THE NOT-SOGOOD NEWS IS THAT THE SITUATION IN MANY EMERGING MARKETS REMAINS MUCH MORE CHALLENGING
partial lockdowns in case of second waves. Competing models, based on earlier start dates, wider spread and lower fatality rates, suggest isolating vulnerable groups while allowing for general normalisation. THE ‘GREAT COMPRESSION’
The lockdowns have precipitated a global ‘great compression’ of economic activity – a deliberate public policy choice to sacrifice growth, national income, private wealth and public debt ratios for public health, as a large, upfront, societal life insurance premium. This compression is thus very different from the recession, precipitated by a financial crisis and contained by fiscal and monetary easing; it is also very different from the great depression – the result of the opposite policy choices, to allow financial crises to cascade, not to loosen policy, even to tighten it at times. Were these extraordinary measures worth it? Probably too early to say. But we have made progress in testing, treatment and capacity, which should help us absorb future waves much better than the first wave of Covid-19. This progress suggests that future, ‘adaptive lockdowns’ will very probably not need to be nearly as severe as the first effort. Lockdown stringency has diverged across countries. The more stringent the lockdowns, the steeper the decline in activity over the course of Q1 – confirming the nature of the downturn as a great compression. As the lockdowns are released, some, but not all, of this effect is likely to reverse. Scientific understanding and the containment of Covid-19 seems to have progressed enough for lockdown relaxation despite clear and present risks and incomplete information. Implications and uncertainties rising from variations in testing rates and results may weigh on the speed and extent of the recovery as lockdowns are relaxed. Looking forward, then, based on our central expectation of gradual, partial, sectoral and regional reopening with downside risks of moderate secondary waves, we would expect the path of GDP to look like what we call a ‘square-root’ recovery – a sharp downturn, almost freefall in activity, stabilised by fiscal and monetary support and the need to sustain basic needs; a limited release in pent-up demand; and a levelling off given the constraints to complete or synchronised reopening. While the widely shared public health policy of lockdowns caused a rapid, deliberate and largely synchronised compression in economic activity starting in Q1 into Q2, the reopening will not be like flipping a switch back “on” – it will be gradual and uneven, taking time to gain traction (all the more so if there are differentiated second waves). We expect continued differentiated performance across economies and asset classes during the recovery. gulfbusiness.com
The Brief / Startups Thriving sectors
MENA’s top 5 industries by share of total funding in H1 2020 Real Estate 24% E-commerce 22% Food & beverage 14% Delivery & transport 9% IMAGE: GETTY IMAGES/ZOFF
Healthcare 9% 0
SOURCE: MAGNITT’S H1 2020 MENA VENTURE INVESTMENT REPORT
Mana Al Suwaidi Executive chairman, Startegi Advisors
Explainer: What is the current state of the UAE’s startup ecosystem? Despite the Covid-19 crisis, here’s why this is a good time to start a business in the UAE How has the Covid-19 pandemic affected the UAE’s startup ecosystem?
It has encouraged more innovators and entrepreneurs to step forward and take advantage of various government funds and incentives to nurture and grow new businesses. The UAE has announced special stimulus packages specifically for the startup ecosystem to help entrepreneurs plan for the post Covid-19 environment and new business opportunities. In the past, funding was the biggest challenge that local entrepreneurs faced. Has that changed in recent years?
Yes. Our region has seen some of the best gulfbusiness.com
innovators successfully obtaining funding and getting noticed on the world stage as reflected in global investors coming forward. Following the pandemic, even more local and regional entities such as The Sharjah Entrepreneurship Centre (Sheraa), Dubai Future Foundation and the Abu Dhabi Executive Council, as well as InspireU and Social Development Bank in Saudi are stepping forward to offer stimulus packages to help entrepreneurs. What are the main hurdles that startups now face?
Growth prospects during a pandemic can be challenging as consumers are hesitant
to try new products and services put forward by innovators. Also, getting funds for R&D will get tougher in the face of competition, as more ideas and innovations flow from jobless employees looking to set up their ventures. Also, has the stigma associated with failure among startups now diminished as the market has matured?
In the past, investors were hesitant to support new ideas, but startups with no products to their name have used technology to offer convenience to both consumers and businesses, and have become multimillion dollar powerhouses. The market hence is more welcoming to new SMEs and startups today than ever before. Which are the segments you see most opportunity in for startups? Is now a good time to set up a business in the UAE?
For people who have lost jobs or have always wanted to be their own boss, there is no better time. It is cheaper to set up and get started now, as business licence fees have been slashed, rents have gone down and manpower is easier to come by during this time. Lastly, what is the outlook for the future? How do you expect the UAE’s startup ecosystem to evolve?
We will see a surge in the number of startups as people get more innovative and use technology to support businesses that have faced turbulence from unforeseen forces such as Covid-19. August 2020 11
ILLUSTRATION: GETTY IMAGES/MALTE MUELLER
The Brief / Wellbeing
A N A LY S I S
Poor diets undermine corporate health The Covid-19 pandemic is exacerbating preexisting issues such as malnutrition and obesity that could hamper employee productivity
oor diets in developing countries are costing businesses as much as $850bn a year in lost productivity, underlining the need for companies to play a bigger role in tackling a problem that’s being compounded by the coronavirus pandemic. Those are the findings of a study by Chatham House and Vivid Economics, the first to analyse the impact of undernutrition and obesity on business in low- and middle-income countries. Both conditions make it difficult for employees to reach their potential and lead to ill-health, which leads to more sick leave. Multinational companies need to do more to fight malnutrition, according to Chatham House. That 12 August 2020
$850bn the maximum estimated direct productivity losses due to poor diets
should include policies that support breastfeeding mothers, offer regular health checks, and provide nutritious and subsidised food at work, the Londonbased think tank said. “Business has a significant role to play,” Laura Wellesley, a senior research fellow at Chatham House, said in an interview. “Aside from productivity losses, there is a significant reputational risk for companies who have a large footprint in low- and middle-income countries and who aren’t doing anything on nutrition.” Obesity has been on the rise in poorer countries, which were already grappling with high rates of undernourishment. The pandemic has further highlighted the importance of nutrition, with studies showing that obese people are more likely to die from Covid-19. The United Nations predicts the virus could push another 10 million children into acute malnutrition. “We can expect the pandemic to worsen the costs, because economic insecurity is so closely associated with nutrition insecurity,” Wellesley said. “We can expect that more households will struggle to access a nutritious diet.” The Chatham House study examined the impact of poor nutrition on 13 business sectors – from mining and agriculture to construction and retail – in 19 countries. It then scaled up the findings to estimate the annual productivity losses due to obesity and undernutrition across developing nations. The greatest productivity losses from being undernourished were in agriculture, mining and construction, with Ethiopia and India facing the highest burden. The biggest impact from obesity was felt in the mining, education and health sectors. The direct productivity losses are estimated at $130bn to $850bn. That range reflects a number of variables and the way Vivid Economics’s model extrapolates the findings from the 19 countries, according to Chatham House. Still, the impact of poor nutrition could be even larger. The model doesn’t include the costs of impaired cognitive development and low educational attainment resulting from undernutrition in childhood, nor does it capture indirect costs such as paid sick leave for malnutrition-related illness. “The toll on human health is enormous, but the economic impact is so huge as well,” Sarah Rawson, a nutrition and health lead at Olam International, said in an interview. “If we’re going to face up to future pandemics, we need the whole population to be as well-nourished as possible so they’re resilient to it.” Olam, an agribusiness giant, is one of the companies backing the Power of Nutrition foundation that funded the study. Bloomberg gulfbusiness.com
The Brief / Social Zaib Shadani Founder and managing director of PR and social media agencies Shadani Consulting and The Comms Room
capture their interest. It is estimated that by 2022, 82 per cent of all online content will be video content, so if you’re not already creating videos, it’s time to make them an integral part of your content strategy. Social media videos can generate up to 1,200 per cent more shares than posts or ads with text or images. Whether it is short-form videos like those on TikTok or Stories or long-form content on YouTube, the future will be video-led.
Rise of social media commerce Brands have been using platforms like Instagram and Facebook to market products for a long time, but social commerce (the act of buying and selling on social media networks) as an avenue for retail
Top five social media trends for 2020 Here’s how brands can break through the noise and be heard on social media
ILLUSTRATION: GETTY IMAGES/CENKERDEM
ocial media has really come to the forefront in the last few months, as we deal with the reality of living in a Covid-19 era. With social distancing and self-isolation in effect, many have switched to social media to consume news, get entertained and most importantly, connect with others. Concurrently, we have also seen a sharp rise in both marketers and businesses revving up their presence on social media platforms and competing for eyeballs. As a result of this mass influx of content on social media, we are now experiencing ‘content overload’ where it’s tough for brands to break through the noise and be heard. Thus, staying updated on the latest social media trends is vital. Here are the top trends that are sure to get you noticed:
Video, video, video Video is among the most-shared content on social media and an easy way to hook your audience and gulfbusiness.com
IT MAY NOT BE LONG NOW BEFORE SOCIAL COMMERCE TAKES MAINSTREAM RETAIL CHANNELS HEAD-ON, AS SHOPPABLE POSTS BECOME THE NORM has gained tremendous prominence over the last few months. It may not be long now before social commerce takes mainstream retail channels headon, as shoppable posts become the norm. With Facebook, Instagram and Pinterest all allowing for shoppable posts and 87 per cent of e-commerce shoppers believing that social media helps them make a shopping decision, it’s no surprise that we see social networks quickly evolving to become retail platforms.
‘Live’ and ‘Story’ formats gain more popularity
of e-commerce shoppers believe that social media helps them in making a decision
2020 is the year of ‘live’ broadcasts and stories. With social distancing and home quarantine in effect for millions of people, stories and being ‘live’ has replaced our ‘real’ life connections as we spend hours lying on the couch, watching friends’ and brand stories on Instagram, Snapchat, and Facebook. It has enabled people to share their thoughts, voice their opinions online, get others involved and communicate in an intimate, authentic and personal way – while still being physically apart. With LinkedIn being the latest to jump in with the Stories function, we are all set to see the trend continue, as others follow suit. August 2020 13
The Brief / Space A N A LY S I S
User generated content will be key User generated content (UGC) is an incredibly cost effective way to not only build brand relationships, but also ensure a steady pipeline of quality content. Certain brands mastered this early on and have built a tremendous portfolio of images and content – at no cost, to fuel their social media pages. No matter how you want to leverage UGC, it will become an integral part of your content strategy in 2020.
Social listening Social listening is the process of monitoring and evaluating what is being said about a brand across various social media channels.
It is an incredibly effective intelligence gathering tool, as it enables insight into what makes your customers tick. Rather than making assumptions about what your customers are thinking, it allows brands to understand exactly what they are saying. With a plethora of sophisticated social listening tools now readily available, brands are realising its enormous potential in gaining insight into what cannot be found anywhere else. Social listening is critical for the effectiveness of a social media strategy and as the tools get more advanced and the insights more specific, we will see an increasing dependence of brands upon the process of active social listening.
A N A LY S I S
To Mars and beyond Along with the Hope Probe, the UAE’s space ambitions and its endeavours towards a knowledge-based economy have also taken flight, writes Zainab Mansoor
n July 20, space enthusiasts watched with bated breath as the Hope Probe lifted off from the Tanegashima Island in Japan on a 493.5 million km long journey, in what is the UAE’s – and the Arab world’s – first mission to Mars. The culmination of a six-year effort of 200 Emirati engineers and researchers – who constructed the Arab world’s first spacecraft – the Hope probe is anticipated to enter the red planet’s orbit in February 2021. As part of its journey, the rocket will initially be put into the Earth’s orbit and will stay there until the exact alignment with Mars is achieved.
14 August 2020
The mission’s completion will also coincide with the golden jubilee of the UAE next year. The Emirates Mars Mission’s Hope Probe will orbit the red planet for a full Martian year of 687 days to provide a complete picture of its atmosphere and layers, examining the reasons for Mars’ surface corrosion and what led to the planet losing its upper atmosphere. Exploring the connect between the current Martian weather and its ancient climate will also offer insights into the potential of life on Mars and other distant planets. Additionally, climatic insights will foster a renewed understanding of the
functionality of atmospheres and aid in finding solutions to the challenges faced on earth. Data sent back by the probe will be analysed and shared for free with the international Mars science community for greater benefit. Implemented by the Mohammed bin Rashid Space Centre, with the UAE Space Agency funding and supervising procedures, the probe will also lend ‘hope’ to the UAE’s ambitious programme of establishing human colonies on the red planet by the year 2117. However, that project will only be possible if a methodical approach is adopted, a senior NASA scientist noted. “I think we’ll get there,” Dr. Lori Glaze, planetary science division director at NASA said, prior to the launch. The first step in that direction will be to return samples from Mars to demonstrate that humans can go to the red planet and actually come back – then proving the ability to bring in heavier spacecraft on Mars in order to return people, the scientist explained. “I think we need to have realistic expectations and take it one step at a time and keep moving to that next step and that next level of capability so that we can eventually realise that dream,” she said.
The Brief / Education COMMENT
Dr Paul Hopkinson, Associate head of Edinburgh Business School at Heriot-Watt University Dubai
Building resilience Executive education can help professionals and business leaders stay resilient and beat sudden disruptions
ILLUSTRATION: GETTY IMAGES/WITT UDOMSILP
It may not be intrinsic to all, but one platform that helps build resilience among mid- and senior-level executives, business owners and emerging leaders across all sectors is executive education. Executive education has traditionally been viewed as the big ticket to the next promotion and an accelerated career growth. It is also, from an HR perspective, one of the most effective tools for recognising and retaining key talent. However, employee training and development is among the first to go during an economic downturn. Although some might see this as a non-essential cost, especially due to budget constraints, it is during these times that it becomes more crucial to invest in top-level and high-performing employees who will help the organisation in riding out the storm. While we continue to navigate the pandemic, there is a steady rise in the appetite for executive learning in the UAE among those looking to hedge against job and career uncertainties by upskilling and reskilling. Hereâ&#x20AC;&#x2122;s how executive education provides the skills needed to survive and thrive in an uncertain world: HEIGHTENED PERCEPTION TO TACKLE DISRUPTIONS
few months into the pandemic, leaders and organisations that have managed to endure the unforeseen storm are now looking ahead to find the best way forward. The pandemic has brought many shining examples of such leaders to the forefront, all of whom have one trait in common: resiliency. Resiliency is the ability to recover from setbacks or thrive despite sudden disruptions. Developing resilience means to become more perceptive in managing your personal thoughts, attitude, and emotions.
Critical thinking, problem-solving, creativity and innovation are required to take on the challenges of a rapidly changing environment and a fast-evolving business model. Executive learning programmes simulate real-life business environments that require participants to grapple with complex scenarios and to respond with creative solutions. Simulations, group exercises, and case-studies help develop the strategic foresight and cognitive skills that in turn enable executives to deal with sudden disruptions. Agile firms use executive development to help critical employees address immediate challenges and build the organisational capabilities needed for securing the firmâ&#x20AC;&#x2122;s future. August 2020 15
The Brief / Startups Attractive buys
Top five funding rounds in MENA-based startups in Q1 2020 In USD
TRANSFORMED LEADERSHIP TO DRIVE CHANGE
In times of crisis, leaders are evaluated for their ability to strategise and drive their organisation on the road to recovery. As such, they need advanced interpersonal skills to initiate change and empower their employees. Executive education allows participants to improve team dynamics, build relationships and grow their network through collaboration with peers. Moreover, leaders need to know how to manage employees belonging to a diverse set of cultures, backgrounds and experiences. The diversity of the student cohorts at executive programmes enrich the participant’s perspective by introducing new thoughts and ideas that can in turn benefit the way an executive receives new, and sometimes, opposing ideas at work.
5. SellAnyCar (Online car trade) Saudi Arabia 35m
4. Jahez (Food delivery) Saudi Arabia 36.5m
3. Vezeeta (Doctor booking) Egypt 40m 1. EMPG (Real estate) UAE 150m 2. Kitopi (Cloud kitchen) UAE 60m
SOURCE: MAGNITT’S H1 2020 MENA VENTURE INVESTMENT REPORT
A N A LY S I S
HARNESSING FEEDBACK TO INCREASE PRODUCTIVITY
Employees benefit the most with prompt feedback, as it helps nip key issues in the bud and improve productivity.
THE WAY EXECUTIVES RECEIVE, PROCESS AND RESPOND TO FEEDBACK IS CRUCIAL, AS IT PROPORTIONATELY AFFECTS THE WAY THEY EVALUATE AND SHARE FEEDBACK WITH THEIR TEAMS AT WORK However, this is not the case in most jobs, where they usually receive feedback on a periodic basis such as the annual performance review. In a learning environment, executives receive rapid and objective feedback on their performance from faculty, peers, and assessors. Exercises conducted during the programme provide executives with insights on how essential feedback should be imparted to others. The way executives receive, process and respond to feedback is crucial, as it proportionately affects the way they evaluate and share feedback with their teams at work. The ultimate goal is to harness the power of feedback for improving employee productivity. 16 August 2020
Changing dynamics While the pandemic may have rattled industries, the regional startup ecosystem remains resilient, writes Zainab Mansoor
in funding was invested in MENAbased startups in the first half of 2020
he year 2020 has been one of tumultuous change so far. While the Covid-19 virus has tested most business sectors, challenging the resilience of individuals and institutions as they grapple with the changes brought about by the pandemic, the crisis has also accelerated the ubiquity of the digital era, with technology transformation and digitisation redefining our economies. For the regional startup ecosystem, the coronavirus has acted as an impetus for supporting and backing new ventures which could potentially lead the region’s digital transformation and its evolution in the ‘new normal’. Startups based in the Middle East and North Africa (MENA) region attracted investments of $659m in the first half of 2020 – equaling 95 per cent of 2019 funding – as investors shifted their focus towards later-stage deals, startup data platform MAGNiTT’s new report revealed. A total of 251 startup investment deals were recorded in the first half of the year across the MENA region, with the UAE receiving the highest share of funding (59 per cent) and Egypt securing gulfbusiness.com
The Brief / Startups A N A LY S I S
the most number of deals (25 per cent). Fintech ranked first by number of deals in H1 2020, accounting for 16 per cent, followed by e-commerce (14 per cent) and delivery and transport (10 per cent), the report added. In the aftermath of the virus outbreak, positively impacted sectors as well as later-stage companies garnered renewed investor interest, as a shift in funding mandate (27 per cent) was witnessed towards industries that benefited from the current climate. Up to 18 per cent of startups across the MENA region actually accelerated their fundraising in the first half of 2020, led by fintech ventures (20 per cent), followed by education (11 per cent), ICT (11 per cent) and healthcare (9 per cent), a joint report by MAGNiTT and INSEAD revealed. Locally, in the UAE, Dubaiâ&#x20AC;&#x2122;s in5 startups raked in more than Dhs65m ($17.7m) in direct investments during the first half of 2020. Regional governments have also ramped up efforts domestically and through cross-border alliances to
CASHRELATED ISSUES PROVED TO BE THE MOST CHALLENGING FOR TECH VENTURES
underpin the startup ecosystem. In July 2020, the Dubai Multi Commodities Centre (DMCC) freezone partnered with Chinaâ&#x20AC;&#x2122;s Innoway to collaborate on tech projects within the region. However, businesses and industries in the mobility and consumer touchpoints segments were badly affected by the pandemic and the related protocols that have since been issued. Traditional retail, transportation and entertainment startups experienced reduced valuations. More so, cash-related issues proved to be the most challenging for tech ventures, the report noted. MOVING FORWARD
As individuals and organisations adapt to new ways of operating, a shift to disruptive technologies and ventures is also underway. Fund masters are stepping away from their original focus areas, driven by behavioural transition and evolving consumer demands. Given that these trends are here to stay, the future of the regional startup ecosystem stands on firm ground.
The Brief / Aviation COMMENT
Nasser Saidi Founder and president of Nasser Saidi & Associates
Flying together Are mergers the way ahead for the GCC’s airline industry post pandemic?
ovid-19 has devastated the global aviation industry along with the tourism and hospitality industry. Even though domestic travel resumed in many nations (in Saudi Arabia, US and China, among others) and flying restrictions eased (e.g. intra-Europe flights, UAE’s Etihad and Emirates are each flying to over 50 destinations), 42 per cent of all global commercial airlines fleets are still grounded, according to research by Cirium [at the time of going to press]. It is little wonder that the International Air Transport Association (IATA) forecast a 55 per cent decline in traffic levels this year. According to IATA, airline passenger revenues are expected to drop to $241bn in 2020, a 50 per cent decline compared to 2019. This is likely to be an underestimate. Covid-19 has generated the deepest recession in advanced economies since the great depression. Its deadly waves are still unfolding in Africa and Latin America, destroying demand for travel, with a second wave likely, according to epidemiologists. Markets have reacted accordingly, with the Refinitiv global airlines price return index down by almost half (as of July 13). By end-June, Zoom’s market capitalisation of $72.44bn was worth more than the combined $62bn value of AA, Southwest, Delta, United, IAG (BA), Air France-KLM and Lufthansa. In May, Singapore Airlines reported its first loss in its 48-year history, while many airlines are under severe financial stress or have filed for bankruptcy (Latam, Avianca, South African and others), Chapter 11 protection, or are being restructured (Thai). The US provided a massive $58bn to rescue its airline industry. To survive the post-Covid-19 world, the aviation sector – including airlines, airports and aircraft manufacturers – will have to be restructured. Despite chatter about “travel bubbles” and “immunity passports”, experts question whether recovered patients are fully immune. About 33 per cent of respondents to an IATA survey (conducted in the first week of June 2020) suggested that they would avoid travel in future as a continued measure to reduce the risk of catching the virus. For now, one of the major deterrents to travel is the quarantine period: only 17 per cent of the survey respondents were willing to stay in quarantine. If no vaccine is discovered, people 18 August 2020
A third of respondents suggested that they would avoid travel to reduce the risk of catching the virus 33% Won’t travel
SOURCE: IATA SURVEY
THE TRIPLE WHAMMY OF LOCKDOWNS, LOW OIL PRICES AND FINANCIAL MARKET TURBULENCE HAS DEALT A SEVERE BLOW TO THE MIDDLE EAST
will refrain from travelling abroad, with local destinations and road trips preferred. Social distancing will become the norm on flights, reducing available seat capacity by 33-50 per cent, reducing passenger load factors and raising questions about economic efficiency and financial viability. The triple whammy of lockdowns, low oil prices and financial market turbulence has dealt a severe blow to the Middle East. The lockdown has directly impacted the UAE’s trade, tourism, transport and logistics sectors, which lie at the core of its diversification strategy and its role as a global business hub. Similarly, Saudi Arabia may need to review its development plans that include tourism as a key diversification option. The travel and tourism sectors have been critical to the GCC with the sector contributing $245bn to GDP (roughly 8.6 per cent) in 2019, while supporting nearly seven million jobs, according to the World Travel and Tourism Council. With more than half of the total GCC population consisting of internationally networked and mobile expatriates, the spillover and multiplier effects to the overall economy from the post-Covid-19 world requires structural adjustment and revision of diversification policies. The GCC countries – with five airlines each in Saudi Arabia and the UAE, alongside Oman and Kuwait with two airlines each – have rapidly expanded their international networks in recent years. With small domestic markets and populations, the strategy has ended up subsidising foreign travellers. As international and regional travel remains highly restricted, the airlines’ revenue streams have all but evaporated. According to the latest estimates from IATA, wider Middle East and North Africa (MENA) traffic is estimated to fall by 56.1 per cent year-on-year in 2020, resulting in a $37bn loss in net post-tax profit. This will risk over 1.2 million jobs (half of the region’s 2.4 million aviation-related employment) and cause a $66bn shortfall in contribution to the region’s GDP. Saudi Arabia, Qatar and the UAE are the most exposed. How should GCC airlines adjust to the massive loss of revenue? Like other airlines globally, Emirates, which expects at least 18-months for a recovery of travel, has grounded much of its fleet, placed employees on unpaid leave, cut the salaries of its gulfbusiness.com
The Brief / Aviation
deficits. The GCC cannot afford a bailout of their airlines, given the impact of Covid-19 and oil prices on budgets, with the IMF forecasting 2020 average deficits of 8.3 per cent for the region.
ILLUSTRATION: GETTY IMAGES/FANATIC STUDIO
THE CASE FOR MERGERS
workforce by up to a half, and initiated job cuts to reduce its operating costs of some $23bn. The CEO of Qatar Airways disclosed an estimated 55 per cent drop in revenues from last year, and stated that about 20 per cent of its workforce would be cut. Job losses in Saudia are also estimated to be very steep, with the Saudi government providing support by suspending airport slot use rules for the summer season and extending licences and certifications for crew, trainers and examiners. However, the costcutting measures by the airlines will not be sufficient to stem the hemorrhage. The majority of GCC airlines are fully government owned. How can they support their airlines? Should the governments consider a bailout? Already, in a bid to tackle the crisis, large stimulus packages amounting to some 18 per cent of GDP are being rolled out across the GCC, including a combination of fiscal measures along with central banks’ monetary and credit packages. But with oil revenues accounting for more than 55 per cent of total government revenues in the UAE and over 70 per cent in Saudi Arabia and Bahrain – according to the IMF – the drop in crude prices is being felt strongly. And with the decline in other revenues (including VAT, taxes and fees), a bailout for the airlines – while supportive of the sector – would imply a massive increase in budget gulfbusiness.com
COST-CUTTING MEASURES BY AIRLINES WILL NOT SUFFICE TO STEM THE HEMORRHAGE
The alternative and better policy for adjustment is through a combination of consolidation, downsizing and mergers. The UAE, Saudi and other countries should consider merging their airlines, which would achieve large cost savings and optimise revenue streams. Given that the governments fully-own or control the airlines, mergers and consolidation allows for a smoother and less costly adjustment process: no anti-trust considerations, labour disputes or having to realign cultural differences. The economic rationale behind mergers is multifaceted: it allows for (a) economies of scale: given that the airlines’ functions and operations (including back office functions, maintenance and support services etc) are largely identical, as are their Airbus and Boeing fleets; (b) cost reductions from the rationalisation of networks – Etihad and Emirates fly to more than 100 destinations in common, leading to cannibalisation and costly competition. A merger would reduce redundant flights and increase passenger load factors while optimising route planning and reducing competition for other passenger and cargo services; (c) more effective and intensive utilisation of existing fleets and airports; (d) scaling down to increase productivity; (e) phasing out airport expansion plans by avoiding duplication of services. The bottom line is that a restructuring and merger of the flagship carriers within the GCC nations and their low-cost airlines would achieve substantial overall cost savings, strengthen the combined groups, make the merged airlines regionally and internationally more competitive and avoid duplication of costly bailouts at a time when the region lacks the fiscal space. The aviation industry, with its massive investments in airports, airlines, transport and logistics, has been at the core of the efforts of the GCC countries to diversify their economies through tourism, hospitality, trade and infrastructure services. Covid19, low oil prices and the global recession are threatening the viability of these diversification strategies. Structural reforms (such as airline mergers and consolidation) and economic policy readjustment will be required for a sustainable post-coronavirus future. The current crisis poses an unprecedented opportunity for consolidation and rationalising of government spending, while also reviewing the structure of state-owned enterprises and government-related entities. August 2020 19
The Brief / Infographics
Indoor archives As consumers shift to digital for most of their entertainment experiences, companies are tailoring their offerings around personalised customer preferences
Bigger slices Revenues for the global entertainment and media (E&M) industry continue to rise steadily, specifically on the digital side Digital revenues share
Including books, cinema and out-of-home advertising
GLOBAL OVER-THE-TOP (OTT) VIDEO REVENUES
CHINA WILL ADD THE BIGGEST E&M REVENUE IN THE NEXT FIVE YEARS US$bn
BIG APPETITE The volume of data consumption is spiking
Absolute growth 2018-2023 (US$bn)
Growth percentage 2018-2023 (CAGR)
80 Projected data
20 August 2020
Rest of the world 77.4
Game on A significant driver of this year’s growth is a heightened interest in gaming as a result of Covid-19 lockdown measures GLOBAL MARKET PER SEGMENT
... PER REGION
PLAYERS PER REGION
Browser PC games
Middle East & Africa
Dowloaded/ Boxed PC games
ESPORTS, THE NEW OLYMPICS
the value that the esports market is set to cross in 2020 COUNTRIES RANKED BY NUMBER OF ACTIVE ESPORTS COMPETITION PLAYERS 5,163
GLOBAL PLAYERS GROWTH
1 Tencent 2 Sony 3 Apple 4 Microsoft 5 Google 6 NetEase 7 Activision Blizzard 8 EA 9 Nintendo 10 Bandai Namco Ent.
CN 20,545 JP 13,133 US 10,832 US 9,273 US 7,350 CN 6,759 US 5,841 US 5,388 JP 4,954 JP 2,968
Revenues in 10 key markets*
MUSIC & PODCASTS
the revenue of recorded music globally in 2018, an increase of 7.7% from 2017
2bn 0 2017
The share of digital musicstreaming in the total growth of music profits in 2018
*Including the US, Japan, China, Korea, UK, France, Germany, Russia, Italy, Spain
of China’s online population, (661 million) listened to digital audio in 2018
MENA’s video content ecosystem
Pure OTT players
Virtual reality sees real growth
Top public gaming companies in 2019
GLOBAL GAME REVENUE FORECAST
Middle East & Africa
• Amazon • Cinemoz • Google Play
• Icflix • Istikana • iTunes
• Netflix • Starz Play • Telly
• Viu • YouTube • Yupp TV
The value of the merger of SiriusXM and Pandora, now the world’s largest audio entertainment company
SOURCES: PWC GLOBAL ENTERTAINMENT & MEDIA OUTLOOK 2019-2023; NEWZOO 2020 GLOBAL GAMES MARKET; STATISTA; EY VIDEO CONTENT CONSUMPTION, PRODUCTION AND DISTRIBUTION IN THE MENA REGION
August 2020 21
The Brief / Lightbox
A picture taken on July 19, 2020, shows a screen broadcasting the launch of the Hope Probe to Mars at the Mohammed Bin Rashid Space Centre in Dubai. The probe is expected to start orbiting Mars by February 2021, marking the 50th anniversary of the unification of the UAE 22 August 2020
August 2020 23
PHOTO: GIUSEPPE CACACE/AFP VIA GETTY IMAGES
FEATURES / TOURISM
Doors wide open: Tourism resumes in Dubai Dubai officially reopened its doors to international tourists from July 7, even as the local economy has gradually returned to some level of normalcy. Covid-19 PHOTO: KARIM SAHIB/AFP VIA GETTY IMAGES
preventative measures remain, but the move will hopefully bolster the entire tourism ecosystem and aid its economic recovery. Have hospitality and leisure businesses in Dubai started to feel the impact?
24 August 2020
FEATURES / TOURISM
CEO, Middle East and Africa, Accor
ince the announcement of the border opening, we have seen an increase in search activities for our properties in Dubai. This has come from regional source markets, such as Kuwait and Saudi Arabia and from international countries including Germany, France and the UK. We believe tourism will have a phased return in our region over the next 18-24 months. Phase 1: Local demand with staycation and local business drivers Phase 2: Regional demand for leisure and business driven stays Phase 3: International travel once confidence in long term travel returns SAFETY MEASURES
Accor is pioneering a new guest safety initiative called ‘All Safe Officer’, as part of which every hotel will appoint a health and safety officer, who will ensure cleaning and hygiene protocols are implemented and handle guests’ questions and concerns. These specially trained officers are part of Accor’s ‘All Safe’ programme – which includes specific operating protocols and deploying cleaning products technology. Accor has also partnered with AXA insurance to provide guests with free medical support including consultations with medical professionals. FUTURE OUTLOOK
An athlete performs stunts with a water jet pack on the first day of the Dubai watersport festival on June 25, 2020
Our long-term development strategy remains unchanged; we are still signing new hotels despite the crisis and we will continue our expansion programme. Our MEA pipeline over the next 36 months includes 127 hotels with over 33,000 rooms, including 29 hotels with over 7,800 rooms in the UAE. In 2020, we are scheduled to open the Sofitel Wafi Dubai in September, offering August 2020 25
FEATURES / TOURISM
498 rooms – making it the largest Sofitel in the region, and we will also open the Grand Mercure Dubai Airport, which will have 360 rooms. In regards to the future of the industry, it holds changes and revised expectations which we need to incorporate in to our daily operations and procedures.
“Decisions about recommending or requiring employees to work remotely are made in coordination with local authorities” next level of global hospitality cleanliness standards, norms and behaviours that are designed to minimise risk and also enhance safety. FUTURE OUTLOOK
Guido de Wilde COO, Middle East, Marriott International
e are delighted to see Dubai lift many restrictions and open up to receive the world. It is still early stages and the overall impact to our hotels in Dubai is hard to predict with the situation still evolving and travel restrictions still in place in other parts of the world, including key source markets. However, we remain cautiously optimistic about the future. We are hopeful that recovery will happen sooner than we think in this market. The UAE is one of the countries that has been able to manage the pandemic quite effectively. The government initiatives, focus on health and safety of residents and the country’s ability to reinvent itself, definitely puts it at the top of the list of countries that can swiftly emerge from this pandemic. SAFETY MEASURES
Covid-19 has not only had a significant impact on our business, but also on how we operate our hotels. The pandemic has required us to raise our exacting standards to an even higher level with new protocols. Marriott created the Global Cleanliness Council to tackle the realities of the pandemic at the hotel level and develop the 26 August 2020
We remain confident in the long-term prospects of the industry. For now, we are taking a careful approach to recovery, with a sharp focus on cleanliness while rebuilding our business. We are also confident that we can leverage our global distribution systems and Marriott Bonvoy – our travel programme – to drive business into our hotels. As a company we will take on-board learnings from the current pandemic and use them as we adapt to whatever the future holds. The one thing we know is that change is constant, and we will adapt to whatever the future brings.
We can see that travellers still want to go on holiday, especially after being isolated for such a long time, but safety has become a top priority. As a result, there has definitely been a staycation trend and it is expected to strengthen in the coming months. We believe the post Covid-19 recovery will be driven by a rebound in domestic tourism. Going forward, travellers around the globe will certainly be a lot more conscious and cautious, but they will want to reunite with their families and friends and will consider pursuing international travel. SAFETY MEASURES
There are many factors we’ve had to consider from an operational perspective, including repurposing some of our hotels for essential service use, adapting new strategies and approaches to secure a strong reopening once tourism restarts, expanding hygiene, sanitation and precautionary measures such as social distancing implementation. We recently launched the Radisson Hotels Safety protocol, a new programme for in-depth cleanliness and disinfection procedures in partnership with SGS. These enhanced health and safety procedures will be adapted based on local requirements and recommendations from check-in to check-out. FUTURE OUTLOOK
Senior area vice president, Middle East and Africa, Radisson Hotels
hile we all would like a speedy recovery, I think the global hospitality industry will still face uncertain times until medical innovations are able to mitigate some of the fluctuating circumstances. Based on previous crises, leisure travel is expected to recover quicker, particularly travel for visiting friends and relatives, rather than business travel.
I think the biggest priority for hospitality brands is to ensure health and safety without compromising the guest experience. While location and experiences used to be the main deciding factor, consumers also want to be reassured that hotels are taking their health and safety seriously. While these have been challenging times, we are pushing forward with our development plans. Radisson Hotel Group recently announced 15 new signings in EMEA in Q2, six of which fall in our region. The travel industry has rebounded from numerous past crises and we strongly believe we will all bounce back again, with a fresh and innovative perspective. gulfbusiness.com
FEATURES / TOURISM
All the clear directives from the authorities are being followed with great focus to ensure the safety and wellbeing of our guests and team members. That includes social distancing, masks, hand sanitisers, gloves, cleaning procedures, schedules for cleaning, and temperature checks.
Co-founder, Middle East Restaurant Association (MERA)
he reopening of international tourism in Dubai is a welcome measure and we are hopeful that the turnaround for the hospitality and related sectors would contribute well to kickstart the economy in the months ahead. The build-up to the Expo 2020, which will begin in October 2021, would also be a crucial revival highway. L We need to understand that people are coming out of a lockdown situation. There is still a hesitancy due to job losses and people are holding on to their purses a lot more stringently due to uncertainty over the future. There are positive signs. A revival of social confidence is of prime importance to the speed of the recovery process. How soon this happens, is anyone’s guess. From whatever trend one is experiencing, the signs are certainly positive and we are headed in the right direction.
“The GCC is the most resilient region I’ve ever worked in. It has adapted over and over again and I’m confident that we will overcome and endure” gulfbusiness.com
thoroughly sanitised prior to guest arrivals, shared spaces are regularly cleaned and we encourage our visitors to utilise contactless payment methods. Rove Hotels has also been named as the first mid-scale brand in the emirate of Dubai to receive a safeguard label from Bureau Veritas.
We all know that until a permanent medical solution emerges in the form of a vaccine or otherwise, it would be a long journey ahead for mankind to get things back to near normal anytime soon. If all the stakeholders can take up the onus on themselves and play their part well, the journey to recovery would be much more steady, painless and consistent. My outlook for the future is filled with cautious optimism.
In the short term, we believe the local market will continue to be our main source of business as residents avail of staycations. As things get back to normality, the numbers of international tourists will also steadily rise over the coming months. We are also optimistic because Dubai is in a very good position to bounce back, being one of the top tourist destinations in the world.
Corporate director, Rove Hotels
ince the local economy restarted, we have seen a positive trend with more staycations booked across our hotels. We are also welcoming people back to our hotels for the use of our co-working spaces, and we are witnessing more residents coming in to dine at our F&B outlets. Our teams and hotels are ready. Fortunately, we have kept our hotels running at high occupancies throughout the last few months, so we are fully prepared to welcome visitors to the city. SAFETY MEASURES
Guests must wear a mask at all times and will undergo quick, hassle-free temperature checks. Our rooms are also
Regional general manager for Middle East, Africa, Turkey and India, The Ascott
he announcement of international tourism reopening in Dubai is positive news for the hospitality industry, which is heavily interlinked with travel. We anticipate that the sector’s revival will still be phased over the next six to 18 months, based on ongoing improved global market sentiment, staggered approaches to bring back commercial demand, and generation of appropriate stimuli for people to resume international travel. The full recovery will depend on aspects such as global travel restrictions and full resumption of airline activity. We have begun to witness early signs of recovery mainly from the domestic market, and August 2020 27
FEATURES / TOURISM
so have initially placed our efforts on the local market with a family staycation offer that can cater to the needs of our guests. Following the easing of restrictions for international travel to Dubai, we anticipate further recovery in the coming months. SAFETY MEASURES
We have launched ‘Ascott Cares’ as part of the brand’s commitment to hygiene and sanitisation. The protocols comply with WHO standards, and have been rolled out since June 2020. They include daily temperature checks and governmental directives on leisure and health facilities, in addition to obligatory regulations of face masks, gloves and sanitisers. Sterilising efforts continue to be ramped up across apartments, lobbies and utilities.
“The hospitality industry will recover, however this will be gradual. The way business was conducted will change” much as we’d like to see things spring back to normal right away, the fact of the matter is that the economy worldwide has been hit hard, and because of that less people will be travelling for leisure over the coming year. We are fortunate to have regular guests who still frequent our restaurants. We are certainly not as busy as we were due to the social distancing of tables and limited seating, but we are very happy to be open and are seeing a slow recovery. SAFETY MEASURES
We have no doubt that the hospitality industry will recover, however this will be gradual. The way business was conducted will change as we adapt to the ‘new normal’ post Covid-19. We forecast the need from select international markets for extended stays, as well as for project-related businesses to resume as restrictions continue to be relaxed.
When guests arrive in our restaurants, we take their temperature and hand sanitisers have been placed at the entrance as well as on every table. We have spaced out our tables, with guests now seated two metres apart from one another to ensure social distancing. We’ve also launched our menus digitally through a QR code on every table so that there is less contact between server and guest. We also take temperature checks for staff members and they are required to wear gloves and masks which are changed with every table. We have also purchased visors for the culinary team that cover their entire face. We have brought on additional cleaning staff for daily and overnight sanitisation of the restaurant. FUTURE OUTLOOK
CEO and co-founder, Lincoln Hospitality and Restaurant Secrets
do not think there will be an immediate impact on operations with international tourism reopening. I believe many people across the world are still very hesitant to travel and we’re also in the middle of summer, when tourism is typically slower here in Dubai. As 28 August 2020
I am very optimistic about the future – the UAE has been very diligent in making safety a priority and taking the measures needed so we can enjoy eating out and going to public areas. I believe with travel slowly opening and Expo not far from now, we will see a slow but steady recovery. In market downturns, there is always opportunity. Lincoln Hospitality is taking this time to penetrate new markets, including Riyadh, London, and Monaco. We are also launching a Dark Kitchen model, with a facility set to launch in DIFC by October. Our expansion plan for 2021 includes a brand-new outlet in Dubai Marina. We have to be adaptable in business, and I truly believe in pushing higher during difficult times to achieve success.
Gheed El Makkaoui
General manager, Careem UAE
s international tourism reopens in Dubai, we believe Careem will definitely see an increase in ride-hailing trip numbers.
To ensure safety, Careem has implemented a number of measures, including ensuring that drivers wear a mask, are in good health and regularly disinfect their vehicles with the appropriate cleaning supplies and ventilate them. Careem Kids Cybex car seats are cleaned with disinfectant wipes before each ride. All seats are professionally deep cleaned regularly by our partners at Champion Cleaners. Plastic divider screens are also installed in all vehicles to aid with physical distancing. FUTURE OUTLOOK
With social distancing becoming the norm in the foreseeable future, we can expect people’s lives to be more connected digitally, not just with family, colleagues and friends, but with their commercial interactions as well. The Careem super app is creating more opportunities for customers and partners and it is expected that the future will show an increase in people using our services.
FEATURES / MEDIA
Gulf Business’ parent company, Motivate Media Group, is offering $1m worth of free advertising and marketing to help small businesses in the UAE
mall businesses in the UAE – similar to their peers across the world – have been hit hard by the Covid-19 crisis. As they struggle to manage resources, many have found themselves unable to allocate budgets towards marketing and advertising. However, it is imperative for companies – especially SMEs – to remain visible and market themselves during this period. In a bid to support such SMEs, Gulf Business – as part of Motivate Media Group’s $1m SME Revival initiative – will offer homegrown UAE small businesses free advertising and marketing. As one of the oldest and most respected business titles in the region with a monthly magazine and a premier news website, Gulf Business offers SMEs the perfect platform across mediums to reach out and be seen in the business community. The initiative, which has received approval from the Dubai government’s Department of Economic Development (DED), will offer 20 SMEs upto $50,000 free advertising space each across all of Motivate’s brands including What’s On, Emirates Woman, Identity, Campaign Middle East and Gulf Business. Motivate, with an expert panel of seven industry leaders, will evaluate the applications and select recipients – not just on the basis of a business’ plan to survive the pandemic – but on their proposal to contribute to the UAE post the pandemic. gulfbusiness.com
The first confirmed panelist is Dr. Amina Al Rostamani, former CEO of Tecom Group and now director of AW Rostamani Group. In addition to the advertising support, the selected SMEs will also receive support in conceptualising digital marketing and promotional plans, helping them to target relevant audiences, and ensuring that their multi-media campaigns meet their expected targets. Some of the qualifying conditions include: • A home-grown UAE company founded prior to January 2020 • Between 10 and 200 full-time employees • Needs to be prepared to create and supply print and digital collateral • Participating companies must agree to be featured editorially in the form of case studies As part of the initiative, Motivate also pledged $275,000 by way of in-kind services to support tech startups and SMEs in partnership with the Sharjah Entrepreneurship Center (Sheraa). Startups selected by Sheraa will receive similar in-kind support by way of advertising and marketing support from Motivate. “Motivate is committing a substantial
Ian Fairservice, managing partner and group editor, Motivate Media Group fund in the form of advertising and marketing to support UAE SMEs across all platforms, during what we are referring to as a period of business revival,” said Ian Fairservice, managing partner of Motivate Media Group. “This contribution forms part of our overall support and we couldn’t do better than to work with Sheraa to cover the essential tech sector. MMG wants to help and encourage SMEs during this challenging period and see their businesses grow as we approach 2021 – the 50th anniversary of the UAE.” Najla Al Midfa, CEO of Sheraa, added: “Sheraa is excited to partner with Motivate Media Group to provide media opportunities for our startups, particularly at a time when exposure to wider markets can make all the difference towards their survival. Collaborations like these are a testament to the growing sense of community within the entrepreneurship ecosystem.”
SMEs can nominate themselves for consideration and find out more details about the initiative on this page: motivatemedia.com/ smerevival
“Collaborations like these are a testament to the growing sense of community within the entrepreneurship ecosystem” August 2020 29
PA R T N E R C O N T E N T
Here’s how Saudi is emerging as the tech hub of the future As it boosts the adoption of digital government and pilot technologies, the kingdom is also preparing to host a groundbreaking tech event that will catapult it further on the global technology stage
Saudi aims to become a technology hub
audi Arabia’s ambitions to emerge as a technology hub received a further boost in July, after the kingdom climbed to the 43rd position on the United Nations E-Government Development Index (EGDI) in 2020, up from the 52nd spot in 2018. The index, which ranks the 193 UN member states in terms of digital government, found that the kingdom had jumped into the ‘very high EGDI group’ mainly due to a significant acceleration in its e-government services. “The pandemic has renewed and anchored the role of digital government – both in its conventional delivery of digital services as well as new innovative efforts in managing the crisis,” said Liu Zhenmin, UN under secretary-general for Economic and Social Affairs. The report highlighted the adoption of emerging and frontier technologies such as blockchain and AI for the delivery of government, financial and commercial services in the region, citing the example of Saudi Arabia entering an agreement with IBM to implement blockchain applications for government and commercial services. The achievement is a result of the outcome
of the National Transformation Programme (NTP) adopted by the kingdom and follows the concerted efforts of many government agencies, the Saudi Press Agency (SPA) quoted minister of Communications and Information Technology, Abdullah Al-Swaha as saying. The launch of several new initiatives has accelerated the government’s digital transformation, as part of plans to achieve the goals of Vision 2030, he added. For instance, the kingdom’s ICT Strategy 2023, released by the Ministry of Communications and Information Technology (MCIT), aims to: • Increase the ICT sector’s contribution to the GDP by SAR50bn over five years • Grow the level of Saudisation in the sector to reach 50 per cent • Increase women’s participation in the sector by 50 per cent • Boost IT and emerging technologies market size by 50 per cent • Create more than 25,000 quality jobs in the sector The MCIT is also focused on developing a strong digital infrastructure, as part of which it
NEOM, announced in 2017, aims to become a living laboratory when it is completed, offering “a vision of what a new future might look like” plans to further develop its telecommunications and IT infrastructure – especially high-speed broadband; create building standards to facilitate the extension of broadband networks; establish an effective partnership with the private sector; support local investments in the telecommunications and IT sectors; enable smart government; and strengthen the governance of digital transformation.
A GIANT LEAP Beyond the initiatives taken to digitise the government, Saudi has also announced mass scale projects that will see the pervasive use
of new technology. The MCIT has identified the following seven technologies as having a game-changing impact on the transformation of the Saudi economy: • IoT and connected devices • Artificial intelligence • Big data analytics • 3D printing • Robotics and drones • Distributed ledgers • AR/VR The market value for these technologies is forecast to reach SAR60bn by 2030, and then grow annually in double digits, according to the ministry. As part of facilitating this vision, the MCIT is preparing to host a new groundbreaking
global tech event – LEAP – in Riyadh, in association with event organiser Informa Tech. The event, which will run from February 1-3, 2021 at the Riyadh Front Exhibition Centre, will delve deep into how emerging technologies are set to revolutionise the world, while also serving as a special marketplace for tech companies from across the globe. The event expects to attract over 30,000 technologists to Riyadh and include over 500 of the world’s thought leaders from enterprise, investment, government and academia. One of the goals of the event is to bring breakthrough pilot technology to Saudi Arabia, enabling the kingdom to invest in it and adopt it first. The kingdom is already making strides in this space: giga-project NEOM, announced in 2017, aims to become a living laboratory when
it is completed, offering “a vision of what a new future might look like”. The $500bn mega-city, which is slated for completion in 2030, hopes to emerge as a hub for innovation, and develop new solutions to prominent global challenges across strategic sectors including food, energy and water. Other giga-projects in the kingdom, including the Qiddiya Entertainment City – which will focus on culture and the creative industries, and the Red Sea and Amaala projects – which seek to redefine luxury tourism – are also being designed as smart destinations with technology elements embedded in the masterplan. With LEAP, the kingdom hopes to provide a greater understanding into how it is giving life to its tech ambitions, while also offering a platform for the best ideas from across the world to take flight.
STRONG FOUNDATION BY
With Muslim consumers across the world seeking out faith-based products and services, the Islamic economy is seeing robust growth among all its different verticals
32 August 2020
FEATURES / ISLAMIC ECONOMY
The Islamic economy has been at the helm of promising growth in recent years, developing a strong foothold across the global landscape. As 1.8 billion Muslim consumers seek to fulfil their faith-inspired needs, creating a formidable consumer base, worldwide spending across the Islamic economy is estimated to grow further. Affinity and affluence among Muslims worldwide, growing engagement from eminent brands, increased investor focus, marketing campaigns and branding tied to faith-based needs are rallying the sector’s growth. In 2018, Muslims spent $2.2 trillion across the food, pharmaceutical and lifestyle sectors, representing a 5.2 per cent year-on-year growth. That figure is forecast to reach $3.2 trillion by 2024, the State of the Global Islamic Economy Report found. 34 August 2020
The report revealed 10 core drivers spurring the growth of the Islamic economy: growing population; increasing affluence; increasing religious affinity; digital connectivity; ethical consumerism; multinational growth; economic diversification and development; halal trade; regulations and investor returns. Measuring the strength of the Islamic economy across 73 countries based on supply and demand drivers and other considerations, Malaysia led the Global Islamic Economy Indicator (GIEI) ranking with a score of 111, followed by the UAE (79), Bahrain (60), and Saudi Arabia (50.2). In terms of business opportunity, halal ingredients, Islamic fintech, and luxury modest clothing were among the
key sectors for growth in 2020. Locally, Dubai is seeking to establish itself as the capital of the Islamic economy and has taken several steps towards achieving that goal. The Dubai Islamic Economy Development Centre (DIEDC) launched its renewed Islamic economy strategy (2017-2021) three years ago to identify new metrics to monitor the growth of three core sectors – Islamic finance, halal products and Islamic lifestyle (including culture, art, fashion and family tourism) and measure their contribution to the country’s GDP. In 2018, the Islamic economy contributed Dhs41.8bn – 9.9 per cent – to Dubai’s GDP, marking a 2.2 per cent increase from Dhs40.95bn in 2017. gulfbusiness.com
FEATURES / ISLAMIC ECONOMY
ISLAMIC FINANCE The GCC’s banking landscape has, in recent years, taken substantial strides in terms of digitisation, product expansion and customer acquisition. Islamic banks in the UAE and regionally have also kept pace, garnering considerable attention. Earlier this year, Dubai Islamic Bank (DIB) completed the acquisition of rival Noor Bank to create a lender with total assets exceeding Dhs275bn, establishing it as one of the largest Islamic banks in the world. Meanwhile Malaysia’s biggest Islamic bank – Maybank Islamic – also launched operations in the Dubai International Financial Centre (DIFC) in February – marking its first overseas office. The 2019 Islamic Banking Index by Emirates Islamic bank, which polled more than 900 respondents with a UAE bank account and a minimum monthly income of Dhs5,000, revealed that 60 per cent had consumed at least one Shari’a-compliant product, up from 55 per cent in 2018. Meanwhile, interest of surveyed nonMuslim customers in Islamic products also grew since 2018, including a 9 per cent increase in Islamic current accounts, and a 6 per cent hike in Islamic savings accounts. “Islamic finance is set to keep expanding through the 2020s and beyond as the GCC countries, Malaysia and Indonesia help drive growth in Shariah-compliant financial products. If we look at Saudi Arabia, Moody’s expects Islamic finance penetration in the kingdom to increase to 80 per cent of system-wide assets (including both conventional and Islamic financing assets) over the next 24 months, up from 77 per cent in 2018, driven by increased demand from both corporate and retail clients,” says Philip King, global head of Retail Banking at ADIB. “However, for the Islamic finance industry to continue to grow to its full potential and reach the global target of $3.8 trillion in assets by 2022, it will need to appeal beyond a purely Muslim customer base. This is a transformation that ADIB has managed successfully and we are seeing growth in our non-traditional customer base,” King adds. Similar to conventional banking and several other industries, technological advancements such as fintech, artificial intelligence (AI) and blockchain, among gulfbusiness.com
Dubai is seeking to establish itself as the capital of the Islamic economy
GCC Islamic finance markets Four countries of the GCC are part of the top 10 Islamic finance markets #1
SOURCE: DINARSTANDARD STATE OF THE GLOBAL ISLAMIC ECONOMY REPORT
others could also facilitate the Islamic finance space by offering faster and transparent transactions, improving security and governance. “Innovation, including the growth and development of the fintech market segment, has created unprecedented growth opportunities for Islamic finance. Crowdfunding and various innovative payment services compatible with Shari’ah principles (including tokenisation), have allowed retail investors to access a wider variety of financial services and assets, while improving on transaction security,” Bryan Stirewalt, CEO, Dubai Financial Services Authority notes. “Technology has a big role to play in further improving the way the market
functions and increasing public awareness of Islamic products. By allowing easier comparison across Islamic finance products in the areas of banking and takaful, it has aided in greater market penetration.” However, as the larger ecosystem continues to be impacted by the ongoing Covid-19 pandemic, the Islamic finance space has also been affected. In light of lockdown protocols and ensuing recessions in Islamic finance’s core countries, the industry is expected to witness lowto-mid-single-digit growth in 2020-2021, after 11.4 per cent growth in 2019 backed by a strong sukuk market performance, an S&P Global Ratings report suggests. “Islamic finance is known for providing socially responsible products as well August 2020 35
as sustainable finance and the Covid-19 environment could give an opportunity to leverage them. At ADIB, the relief programmes and support measures that we are offering to our personal and business customers have had strong take-up, and we remain responsive to their changing needs,” opines King at ADIB. Matthew Escritt, partner, Banking and Finance, Pinsent Masons Middle East adds: “In today’s liquidity constrained environment and as all businesses grapple with the complex commercial impact of the pandemic, the opportunities for the Islamic economy are clear. Well-capitalised Islamic financial institutions are well placed to plug the anticipated liquidity gap and support sound businesses through a period of profound economic uncertainty. 36 August 2020
“What is particularly compelling about this juncture is that these opportunities to grow market share are matched in the UAE by a concerted effort on the part of the government to improve the regulatory environment in which the Islamic economy will operate. The innovative legislative initiatives that have recently been launched by the Dubai Islamic Economy Development Centre are particularly opportune and it seems very likely that this confluence of events will herald the start of a purple patch for the entire industry.”
MODEST FASHION Modest clothing is well on its way to be a part of the mainstream fashion roster, whether in stores or on the ramp. Prodded
by millions of Muslims donning modest outfits, several marquee brands have joined the bandwagon, including Nike, which offers modest swimwear for female athletes. Similarly, British designer Hana Tajima collaborated with Japanese retail company Uniqlo to introduce a modest collection. Modest fashion has also made its way into catalogues, campaigns, and covers – Halima Aden was the first hijabi model to grace the cover of British Vogue. Meanwhile, events such as Modest Fashion Weeks have brought cultural and ethnic inclusivity in the spotlight. Dedicated to the industry with more than 300 designers and brands, and over 500 influencers, the events were held across the globe from 2016, including in Istanbul, London, Dubai, Jakarta and Amsterdam. gulfbusiness.com
FEATURES / ISLAMIC ECONOMY
“I think the concept of modest fashion has truly exploded in the last few decades. The industry is generating billions of dollars and is expected to rise in the coming years,” says Mosika Zeid, founder of modest fashion brand Desert Cove. “When I started Desert Cove, I felt there was a big gap. As someone who dresses modestly, I found the options were limited, especially when it came to good quality and aesthetics. But it gladdens me to see that modest fashion is evolving. You see more brands coming in, influencers bringing more charm to the entire modest fashion industry and now Modest Fashion Weeks are also happening. So overall, modest fashion is in a good place.” Scaling demand for fashionable yet modest clothing to fight stereotypes and represent Muslim women has also seen growing investor interest. In 2019, Goldman Sachs and Wamda Capital acquired a minority stake in Turkey-based modest fashion retailer Modanisa. “The majority of my customers are Muslims. I’d say about 30-40 per cent are non-Muslims, particularly in the eastern regions where women work and live and like to dress modestly to respect the culture. Modest fashion is definitely something even non-Muslims are adopting. To be honest, having non-Muslims buy my clothes makes me very happy; I feel now more and more people are willing to question the trends laid down by the fashion moguls and are happy to follow their own personal style,” Zeid opines.
HALAL COSMETICS In line with fashion, the demand for halal cosmetics among Muslim consumers is also rapidly growing. The halal cosmetics and personal care market size is poised to grow by $28.34bn during 2020-2024, market research company Technavio noted. “The younger Muslim generation is becoming more conscious over the presence of chemicals and non-halal ingredients in their cosmetics and personal care products. Manufacturers of halal cosmetics are now forced to introduce new technologies in the area of research and development, formulation, and production. This is all due to the change in buying behaviour, as product lines must now include new halal products dedicated to gulfbusiness.com
Amara Halal Cosmetics’ products cater to different age groups and ethnicities
different age groups and ethnicities. This is a growing industry – very competitive and fast paced. If you can keep up with the product innovations then you are safe in the game,” Shamalia Mohamed, founder of US-based Amara Halal Cosmetics opines. Brand identity plays a major role in attracting new customers and helping consumers differentiate between halal and conventional brands. “The use of the halal logo is a significant marketing tool as it communicates and convinces consumers that the products have been manufactured according to Islamic requirements,” Mohamed adds.
HALAL FOOD The halal food market is expected to build momentum across the global
supply chain as a burgeoning Muslim consumer base expands along with retail. Global Muslim spend on food and beverage, valued at $1.4 trillion in 2018, is forecast to reach $2 trillion by 2024, the SGIE report reveals. Given its popularity, halal food is expected to become a matter of standard choice for Muslims and nonMuslims, across several Islamic and non-Islamic economies. Regionally, in the UAE, the Emirates Standardisation and Metrology Authority (ESMA) launched the ‘Halal National Mark’ to regulate and certify halal products. Additionally, the Dubai Airport Freezone Authority (DAFZA) launched the Halal Trade and Marketing Center, to support global halal product stakeholders and facilitate their growth. Technology is also facilitating the growth of this sector; Singapore-based foodtech startup WhatsHalal aims to benefit both F&B manufacturers and consumers with its halal traceability platform that connects the entire supply chain.
Given its popularity, halal food is expected to become a matter of standard choice for Muslims and non-Muslims, across several Islamic and non-Islamic economies August 2020 37
FEATURES / ISLAMIC ECONOMY
Malaysia, recognised as a global halal hub, established the world’s first halal pharmaceutical standard, MS 2424:2012 Halal Pharmaceuticals as general guidelines. As of 2017, a total of 251 facilities were licenced by the Drug Control Authority (DCA), part of the Ministry of Health in Malaysia, according to official figures. Meanwhile, in terms of business opportunity, the SGIE report has highlighted halal gelatin, halal vaccines, halal nutraceuticals, and holistic halal-based homeopathy as hot sectors for growth in 2020. The global halal nutraceuticals and vaccines market hold substantial potential for growth, estimated at $49.3bn in 2019 and expected to reach $88.5bn by the end of 2027, global market intelligence firm Coherent Market Insights noted. Additionally, in 2015, the global gelatin market was estimated at $2.7bn, with the use of gelatin in pharmaceuticals and nutraceuticals estimated at $1.3 billion, Saakh Pharma’s research suggests. Pharmaceuticals and nutraceuticals are the second and third largest application categories of gelatin after food, accounting for 26 per cent and 21 per cent of the market respectively, the research added.
Healthy growth The top 5 pharmaceutical Muslim consumer markets (2018) Turkey
$11bn Saudi Arabia
$8bn United States
$4bn SOURCE: DINARSTANDARD STATE OF THE GLOBAL ISLAMIC ECONOMY REPORT
MUSLIM TRAVEL, HALAL MEDIA AND RECREATION
The travel sector has also seen an uptick in faith-inspired demands. A widening Muslim diaspora scouring for holistic travel packages that are not only conditioned to religious sensitivities but entail content-rich experiences, have led to the manifestation of specialised service providers. Travel-related, faith-inspired content generally entails privacy enhancements, alcohol-free environments, halal dining options, and prayer arrangements. The Mastercard-CrescentRating Halal Travel Frontier 2019 Report identified 17 trends that are expected to shape halal travel. Technology, environment, and social activism will greatly impact the halal travel industry while technologies such as augmented reality (AR), virtual reality (VR) and AI will also drive new trends, the report found. “There has certainly been an increase in the demand for faith-inspired travel and I think much of that is due to parts of the industry reacting to the need for 38 August 2020
Prayer facilities inside a room at the Gaia Hotel near Taipei
it. I believe there is plenty to come from the travel-tech sector when it comes to delivering a great customer experience, however that’s for both faith-based and mainstream travel demands. With apps currently available to customers looking for Qiblah finders or content rich destination guides, these have helped in making Muslim travellers confident in exploring new destinations,” notes Nabeel Shariff, founder of halal holiday site Rihaala.com. “Muslim travellers are as aspirational and adventurous as other lifestyle segments, so the first key driver is delivering exceptional experiences. Tailoring those experiences to their faith requirements adds a further layer of comfort and confidence in the destination, hotel or attraction they are investing their time and money into. The third key driver is about making those requirements easily accessible and common place in a destination,” Shariff adds. Meanwhile, halal media and recreation have a widening portfolio of content – movies and TV series – as well as apps aimed at Muslim needs. Muslim spend on media and recreation was $220bn in 2018 and is forecast to reach $309bn by 2024, the SGIE report reveals. While events such as the Mosquers Film Festival, that aims to entertain and build bridges by presenting Muslim experiences, are emerging, faith-inspired content for children such as cartoons are also gaining strength and prominence.
PHOTOS: GETTY IMAGES
FEATURES / GULF BUSINESS ACADEMY
Why company structure
AFFECTS CUSTOMER SERVICE Rethinking the ownership model might pave the way for improved customer service, opines Gulf Business Academy trainer Mark Dickinson
he reality is, in today’s situation, many companies don’t really care about customers; they care only about themselves. Executives who run companies are expected to make cuts during hard times, yet, would they put themselves in harm’s way to protect the service of customers? I highly suspect not. With many job cuts affecting those in the front line and junior employees, there remain fewer skilled customer service employees. But if these roles were made redundant because there are ‘too many of them anyway’, then there should be a general inquiry into how business was being conducted and how it was possible for the company to be overstaffed in the first place. This would call into question the competency and performance of the management. This is a very important issue that must be addressed. Cuts and reductions are very complex issues, and often emotional. A decision has to be taken to rethink how business is run. If we are to rethink a way of working that requires less management and more employee ingenuity, we can concentrate our company’s efforts on delivering outstanding customer service rather than building outrageous management empires. There is an abundance of technology available to manage several business gulfbusiness.com
functions, and there are loads of wonderful outsourcing options that can service companies’ needs too. So why are companies still relying on in-house employees for these services? Why are they still hiring in the old fashioned way? Ownership management must become the model of the future. Every company has to consider the idea of giving away a share of their company to the people who run the business so that they are invested in the success of the company. The final word on this: if a manager were an owner, I am pretty sure profits would increase, because every individual’s earnings would be exponential based upon the success of the company. If the company was staffed solely by owners, meaning those with a share in the company, then how motivated would every single person be to create a more successful business? The issue of customer service would occupy the minds of every individual. The
golden rules that every company must follow include: 1. Keep the customers that you have 2. Get them to spend more 3. Get them to come again (and bring their friends) People serve people, and in this business model, the entire organisation would be concentrated on finding ways to streamline the business, remove inefficient processes, and deliver exceptional service to customers. While researching this article, I went out touring different kinds of businesses to see how I would be served as a customer. I was unknown. One of the thousands of customer transactions conducted by organisations. What was the outcome? I got processed. In the current situation, customers are also dealing with physical boundaries. In hotels, they have erected glass barriers between the receptionist and the customer, with the same seen at fast-food restaurants and the supermarket cashier desks. In finedining restaurants, the menu is now printed on single-use paper placemats while banks make you line up as far away as possible until they can attend to you. The mantra – in line with the required precautionary measures, is to reduce customer/employee interaction and avoid contact at every possible step of the process. As humans, we are gregarious. It is innate. We function that way. People love to talk to people. Once we are out of the pandemic, companies should focus on creating unparalleled levels of service where every person is respected by those that serve them, where customers are embraced, they are called by name as often as possible and they are treasured by those that serve them. Companies will do well to rethink their model of ownership while also streamlining costs and ensuring that their employees are concentrated on growing the business by taking care of every customer. August 2020 39
Phi Trends: The business implications of 5G Investors must keep a lookout for stocks with game-changing potential, which will inevitably tap into 5G and enable future growth prospects, opines entrepreneur and investor Shailesh Dash, who shares his market perspective in this monthly column
he world today is very different to the one a decade ago, as rapid developments have facilitated a shift towards a new and highly digitalised ecosystem. Constant innovation has further propelled global trade and business to new heights. Notably, global wireless technology has played a significant role in aiding this progress, specifically with the onset of mobiles using electromagnetic spectrums such as 2G, 3G, and then 4G. Now, the fifth generation of mobile networks (5G) is bound to set a new standard in wireless technology, far beyond anything one could have anticipated a few years ago. Its groundbreaking performance improvements are likely to guide the world economy through yet another potentially historic growth phase, as it has the potential to permeate and transform nearly all industries. The adoption of 5G technology is anticipated to catapult us into Industry 4.0 with the projected economic impact anticipated to be phenomenal. Research shows that once 5G is fully deployed, projected by 2035, it could facilitate $13.2 trillion in global sales (5 per cent of global real output), and result in the
“The GCC is no stranger to innovation – supported by government initiatives, mobile operators in the UAE and Saudi have been quick to deploy 5G technology” generation of 22.3 million jobs across the 5G value chain, from OEMs, operators, content creators and app developers, to consumers. The business implications of 5G are also astounding. From an enterprise perspective, the technology holds the potential to significantly improve productivity gains, operational efficiency, and process automation to full autonomy across the value chain. Specifically, 5G can address shortcomings and enhance business models for the e-commerce, entertainment, automotive, manufacturing, and logistics sectors. It could also improve Internet of Things (IoT) uses within the industrial, consumer electronics, healthcare, retail, utilities and energy sectors. For instance, it will
Valuation Matrix of Recommended Stocks Company Name
Market Cap (in USD bn)*
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*Note: Data as of July 16, 2020
PE Ratio* (X)
have a critical role to play in autonomous driving and connected logistics to support the T&L sector and the concept of smart cities; while healthcare enhancements could enable robotics, blockchain uses, wearable telemetry, and remote diagnostics among others. Notably, 5G can help healthcare organisations in improving patient experience with personalised, preventative care while also reducing the cost – a critical component in the current Covid-19 ravaged scenario. The pandemic has severely dented the hydrocarbons industry and broad economic disruptions have adversely affected the GCC. Amid such catastrophic circumstances, transformation to a digital economy will be centric to the region’s successful economic revival. The Middle East, and particularly the GCC, is no stranger to innovation – supported by proactive government initiatives, mobile operators in the UAE and Saudi Arabia have been quick to deploy 5G technology. Moving rapidly from trials to early commercialisation, 5G advancements will play a particularly decisive role in the GCC as its supply chain and logistics industries remain major GDP contributors. The technology could also contribute immensely to the digital transformation of industry vertical sectors and could be a crucial business driver amid the current pandemic. Local authorities are working to deploy the full potential of 5G in a post-pandemic era,
5G enabled sales by (2035, USD billion) industry Manufacturing 4,687 Information & Communication 1,569 Wholesale & Retail 1,198 Public Services 985 Construction 731 SOURCE: QUALCOMM
in order to revive investment within the MENA digital ecosystem. As governments support major efforts to contain Covid-19, the transformative power of 5G solutions could enable broader economic recovery. Digital revolutions have traditionally led to a boom in equity markets, particularly for companies that have proven to be pioneers in the field of innovation. For instance, Qualcomm’s stock prices rose a whopping 13,891 per cent in 1991 with the introduction of 2G, while InterDigital’s stocks surged 1,459 per cent in 1998 as 3G brought the internet to mobiles. A decade later, 4G-enabled smartphones proved a game-changer for Apple as its sales soared by 736 per cent year-on-year in 2008, inflating its stocks by 1,046 per cent. The onset of 4G was revolutionary – not just for existing tech companies such as Microsoft, but also because it resulted in the birth of companies such as Netflix (whose shares have returned an exponential 34,340 per cent since its listing in 2002) on advances made due to HD streaming. Evidently, lucrative returns are
fairly certain for investors who pick up on these trends at the right time, while still in their infancy. The implementation of 5G networks are likely to cause a similar seismic impact on the stocks of companies that build on this trend, some of which we believe to include the likes of Teradyne, Cerence, Lumentum, Xilinx, and Apple. However, one should only consider investing in proposed companies with a medium to long-term time horizon. Teradyne’s RF semiconductor test solutions are providing optimised test coverage within 5G networks. Their testing of data resources has nearly tripled from a year ago, and as 5G increases demand for higher capacity data storage, Teradyne remains a relevant stock to eye. Cerence is another stock meriting mention. As an automotive virtual assistant maker, it is playing a significant role in the global shift to autonomous driving,
connected cars, and even smart cities, as 5G boosts prospects for these futuristic trends. Lumentum is another strong contender, having developed new XR optics networking devices using its in-house optical modules and processes to potentially lower data delivery costs across 5G, wireline, and cloud-based networks. Meanwhile, Xilinx’s FPGA chips are being used across numerous technologies from 5G infrastructure equipment, to cars, and consumer electronics, making it yet another undervalued growth stock. Lastly, Apple is expected to be one of the largest benefiters in the 5G era. Once Apple ventures big into 5G, rivals will likely be compelled to keep up with its 5G iPhones sales. Experts further believe that Apple has the potential to be the first company with a $2 trillion valuation, backed by 5G and rising services momentum prospects. Amid the widespread impact of the pandemic, it has now become obvious that technology implementation is crucial for both health and economic recovery. For the GCC, it is imperative that the region continues to create an environment that allows 5G to flourish while service providers can monetise it by opening up the opportunities for consumers. Leading from the front, the UAE can become the flagbearer of this technology revolution for the other nations to follow. At the same time, investors must watch out for stocks with game-changing potential, which inevitably will tap into 5G and enable future growth prospects in an increasingly mobile world.
Disclaimer: This column is purely for academic and educational purposes. Nothing mentioned here should be taken as solicitation to trade or a recommendation of a specific trade. The author has direct exposure in recommended stocks.
FEATURES / MARKETING
EVOLVING TRENDS Marketing has to remain dynamic and adapt to the changing needs of the customers, opines Sunita Hadani, managing director of the Hadani Group of Companies
Sunita Hadani, managing director of the Hadani Group of Companies
propositions, and depending upon the objectives that customers need to achieve, one can leverage the relevant platform. For example, LinkedIn is very B2B centric and can be targeted for lead generation, lead conversion/progression and brand awareness. Twitter is great for building conversations, engagement and conversion. The approach needs to be customised as per the requirement and need.
Traditionally, marketing budgets are among the first to be axed in times of crisis. Have you noticed the same during this pandemic?
With the pause on face-to-face events, marketing departments quickly transformed themselves to newer ways of operation. As a result, we experienced a surge in digital marketing with 360-degree marketing tactics implemented including social media, video, content marketing , google ad words, and search engine marketing. We have also witnessed a major shift to virtual events, lead generation programmes, account-based marketing and PR. Has the crisis also led to a change in the way organisations are looking at marketing?
The pandemic has changed the way that organisations look at marketing, because it has fundamentally shifted priorities across the board. From messaging to format, marketing efforts have to adapt in-step with the needs and concerns of customers. Organisations that ignore this global shift and use this crisis as an opportunity for a hard-sell will inevitably come off as “tone-deaf” and risk alienating potential clients. We are helping our customers establish themselves as thought-leaders in their industries through strong content marketing that creates differentiation, elevates their brand value and establishes long-term market leadership. Considering the current sensitivities, what are the do’s and don’ts when advertising in this situation?
First and foremost, organisations must not look at this crisis as a sales opportunity. 42 August 2020
A big focus for you has been tech marketing. How has that the segment evolved?
If customers feel that they are being taken advantage of, the damage to an organisation’s brand could be irreparable. Goals need to shift from sales to genuine support. This is a moment for empathy, not pure financial gain. These difficult times are a perfect moment to offer limited free trials, consultations, and thought-leadership content that addresses the myriad business concerns that have come from the Covid-19 crisis. Moving away from the crisis, platforms for marketing have exploded with the rise of social media. So how can brands ensure they have a good mix?
The opportunities provided by social media are immense. We are living in a time where customers are online a lot more, consuming all kinds of information and becoming more knowledgeable. Social media provides a fantastic model for the quick deployment of campaigns that can be optimised in real time for faster results. Every platform offers unique value
Marketing tends to keep pace with the associated industries and as tech evolves at the speed of light, tech marketing has transformed in a similar pattern. We have observed that marketing organisations are starting to rely on data insights to build their strategies. We are working with our clients on mining and analysing data to build robust and agile marketing plans that speak to what their customers actually need, not just what new technology is on offer. Lastly, what are your plans going ahead? How do you hope to thrive in the ‘new normal’?
We have been very fortunate to survive the current market realities. We achieved this by transforming ourselves to offer relevant services and we will continue to thrive by building the right skills and teams. We have been blessed to have great customers and employees. Our motto has always been to go the extra mile for our customers – beyond the signed contract – and we plan to continue providing that value and care. gulfbusiness.com
PHOTO: GETTY IMAGES/SOUVIK DAS
INDIAN LEADERS 2020
illions of Indians call one of the six Gulf countries home. Some have established prominent global conglomerates in the region, while others have migrated here to lead international companies. The GCC has also attracted Indians who are keen to tap into its booming startup ecosystem, while second-generation business leaders have now established strong roots in the region. Lauding the achievements of this diverse diaspora, we reveal the influential business tycoons, executives and entrepreneurs who have helped shape the GCC’s economic landscape
Wealth isn’t everything, but it’s hard to ignore the financial clout of these business figures. Along with being the wealthiest Indians in the Gulf, these individuals are also among the most philanthropic SOURCE: Rich list figures taken from Forbes Billionaires list mid-July
Yusuff Ali M.A.
Indian businessman Yusuff Ali M.A. has firmly established himself in the GCC – last year, he became the first to get the UAE’s ‘gold card’ permanent residency and in March, he was chosen as the first Indian to receive Saudi Arabia’s premium residency. One of the UAE’s richest and prominent businessmen, Yusuff Ali’s LuLu Group is among the largest supermarket chains across the GCC, Egypt, India and the Far East, with over 188 stores worldwide. When he is not leading the business, which makes revenues of over $8.42bn, he is equally active on the social front having been awarded the prestigious Padma Shri by the Indian government in 2008 for his contribution to business and society.
Another winner of the Padma Shri award for his contributions to India is Ravi Pillai. The son of a farmer, he migrated from Kerala to Saudi Arabia after his construction business was forced to stop operations. The company he founded in 1978, RP Group, has now become a diversified conglomerate with 20 companies, that has executed projects worth over $25bn. Expansion is also on the cards – late last year, Pillai revealed the group’s plans to invest up to $1.46bn in the hospitality business globally to grow its brand Raviz.
From humble beginnings and a single school, Sunny Varkey, the son of expat teachers, expanded UAE-based GEMS Education to become the largest K-12 private education provider in the world, operating more than 250 schools in 13 countries worldwide. Currently more focused on charitable causes after establishing the Varkey Foundation in 2010, he also pledged to donate at least half of his wealth to charity under the Giving Pledge in 2018. Varkey also started the $1m Global Teacher Prize in 2014 and last year, joined the winner in meeting US President Donald Trump at the White House.
Landmark Group: $2.2bn
Indian billionaire Micky Jagtiani is famously said to have worked as a taxi driver in London to make ends meet before kickstarting a business selling baby products in Bahrain in 1973. Over the years, that single Babyshop outlet led to the creation of retail and hospitality conglomerate Landmark Group, which currently operates 2,100 outlets spanning 30 million square feet across India and the Middle East. Jagtiani has also driven philanthropic activities, with Landmark and two of his foundations recently announcing Covid-19 relief efforts of over $4m.
Vaswani’s Dubai-headquartered Stallion Group, named after his favourite animal, marked its beginnings when as a young 21-year-old, he took over a Nigerian trading business from his father. The company has since grown to become a major investor across the African continent with interests in automobiles, commodities, food and manufacturing. Vaswani has also been at the forefront of driving the company’s philanthropic efforts, and earlier this year, pledged free rice and fish for three months to all Covid-19 hospitals across Nigeria.
Having started his career as a radiologist in a hospital in Abu Dhabi, Shamsheer Vayalil went on to establish VPS Healthcare with initial backing from his father-in-law Yusuff Ali. Starting with one hospital in 2007, the company now manages 23 hospitals and over 125 medical centres across the GCC, India and Europe. It also runs LifePharma, one of the UAE’s largest pharmaceutical manufacturing companies. Vayalil is also the vice chairman and managing director of investment firm Amanat Holdings, which this year revealed that it was mulling an acquisition in VPS.
Legends The company founders and veteran business leaders who have had an unquestionable impact on the Gulf’s economic and social landscape in recent decades
Dr. Zulekha Daud Zulekha Healthcare Group
The now 82-year-old Zulekha Daud, born into the family of a construction worker, studied medicine and moved to the UAE in 1964. She became the first female Indian doctor to practice in the UAE. Mama Zulekha, as she is affectionately known after having delivered over 10,000 babies over the last 56 years, is the chairperson of the Zulekha Healthcare Group whose portfolio includes two multidisciplinary hospitals in Dubai and Sharjah, three medical centres in the UAE, three pharmacies and a hospital in her hometown of Nagpur in India. The group’s medical facilities in the UAE treat over 550,000 people annually, positioning it among the largest private healthcare providers in the country, earning Daud a UAE gold card permanent residency visa.
Yogesh Mehta Petrochem Middle East
Mehta, more than anyone else, knows not to allow failure to be a deterrent. In 1990, at the age of 30, his chemical distribution company went bankrupt in India. By 1995 though, he set up Petrochem in Dubai in partnership with Petrochem UK. Today, Petrochem Middle East exports more than 700,000 metric tonnes of products from its distribution terminal at Jebel Ali Free Zone and is the biggest chemical distributor in the Middle East.
Firoz Merchant Pure Gold Group
At the age of 22, Merchant, who grew up in poverty in Mumbai and was even forced to drop out of school as a result of it, visited Dubai for his honeymoon. He spent a significant amount of time during that visit scouring the lanes and by-lanes of Dubai’s Gold Souq. He subsequently set up a gold trading business in Dubai’s Deira district in 1989 and scaled it into a business that today employs over 3,500 people, with manufacturing facilities in China and India, and which also has plans to expand its retail store footprint to 250 stores in the near-term. With annual revenues of around Dhs1bn, between 70 to 80 per cent of the company’s business comes not from gold, but diamonds. In 2019, Merchant was also granted permanent residency in the UAE.
“Beyond the technology, besides the specialists, there is something more – the care of a magic touch” D R . Z U L E K H A DAU D
Aster DM Healthcare
The Dubai-headquartered Dodsal Group’s diverse fields of specialisations range from engineering, procurement and construction, to trading, manufacturing and the food business. With as much razor-focused business acumen that Kilachand applied to transform the fortunes of the company after taking over the reins from his father, the octogenarian has now devoted himself full-time to philanthropy projects across the globe including education, community, health and culture. Not only did he donate a staggering $25m to his alma mater Boston University in 2011, here in the UAE, he has also donated to Dubai Cares, an initiative by Sheikh Mohammed bin Rashid Al Maktoum to educate children in several developing countries around the world.
Azad Moopen, a doctor and former lecturer at the Calicut Medical College, visited the UAE in 1987 to raise funds for the renovation of a mosque in his hometown of Kalpakanchery in Kerala. Recognising that the healthcare sector had yet to boom in the UAE, he decided to set up his own medical practice out of a two-bedroom apartment in Bur Dubai near Port Rashid. The Aster DM Healthcare group that he founded – which includes three brands: Aster, Medcare and Access – has since scaled exponentially to 388 medical establishments in eight countries, with a combined workforce of around 20,000 employees and revenues of $1.07bn in 2018-2019. In February, the company also received approvals to obtain 100 per cent ownership of its business within Dubai.
The Jashanmal business association with the Middle East is over a century old. In 1919, Tony Jashanmal’s grandfather established a general store in Basra, Iraq, that sold items including stationery, newspapers, books and men’s clothing. International expansion began back in 1934 when his grandfather set up shop in Kuwait’s Safaat Square, and later on in Dubai’s Al Nasr Square in 1956. Three generations in, that expansion hasn’t stopped. Jashanmal, who speaks seven languages and left a PhD mid-way to join the family business in 1971 after his father died, now serves as the current group director of an enormous retail and distribution empire. The group now has over 150 retails stores in the UAE, Kuwait, Oman and Bahrain, and a distribution network of over 1,000 outlets.
Joy Alukkas Joyalukkas Jewellery
Paras Shahdadpuri Nikai Group
Shahdadpuri had a flourishing career as an Indian diplomat with international stints – regionally his postings included Saudi Arabia and Libya. But by the late eighties, he decided to leave the foreign service and instead set up his own commodity trading business. On a flight back from London in 1987, he missed his connecting flight to India at Dubai airport, and ventured out for a day visit to the emirate. Enamoured by its potential, he set up Nikai Group in the emirate. Today, the company has interests in electronics, IT, home appliances, retail food chains and FMCG, with an annual turnover reportedly close to Dhs2bn. Winner of the prestigious Bharat Shiromani award, Shahdadpuri is also known for his philanthropic efforts.
One of 18 children, Joy Alukkas dropped out of college to pick up the skills of the trade from his father who ran a jewellery business in their hometown of Thrissur in Kerala. The then 30-something decided to take those early lessons and ambitions international, opening his first showroom in Abu Dhabi in 1987, followed by another one in Dubai and Sharjah. Today, that empire has spread to cover over 160 showrooms across 11 countries, employing 8,000 people with annual revenues of around $2bn. The rapid expansion has never been at the cost of quality – Sheikh Mohammed Bin Rashid Al Maktoum even awarded the business the Dubai Quality Awards certification.
Adeeb Ahamed LuLu Financial Group
A multifaceted professional, Ahamed serves as the managing director of LuLu Financial Group, Tablez and Twenty14 Holdings — which owns the prestigious Great Scotland Yard Hotel in London, Waldorf Astoria Edinburgh - The Caledonian and others. He has led the massive expansion of LuLu Financial Group from a one branch operation in 2009 to a network of over 220 branches across 11 countries. Ahamed also serves as a board member of the South Asia Regional Strategy Group at the World Economic Forum, and is a socially responsible philanthropist contributing to education and elderly care.
Dhananjay Datar Chairman and managing director Al Adil Trading
Popularly known as the ‘Masala King’, Datar has spearheaded the growth of his Al Adil spices brand in the region. From a tiny store selling groceries in Bur Dubai in 1984, it has now expanded into a chain of 43 stores spread across the GCC, two spice factories, two flour mills and an import-export company. The group also produces more than 700 products under its own brand, Peacock. Datar has also stood out for his philanthropic efforts, recently announcing that he would provide free tickets to those impacted by Covid-19 in Dubai, who were seeking to return to India.
PNC Menon Rizwan Sajan
When Sajan moved from Kuwait to Dubai in 1993, the job he was offered paid less than the one he left behind in Kuwait – prompting him to tap into his savings and start Danube in 1993. The building materials supplier has since diversified operations into several related verticals. Starting his business in the UAE shortly after the Gulf War, he knows the importance of contingency plans – he had one in place when the recent Covid-19 pandemic struck. Thanks to it, he has confirmed that none of the group’s over 3,600 employees will be laid off a result of the crisis.
The 71-year-old real estate tycoon has a track record of building billion-dollar companies. His UAE-based Sobha Realty’s operation is scheduled to become a billion-dollar operation within the next 3-5 years – thanks largely to its 8-million-square-foot gated community in Dubai’s Mohammed Bin Rashid Al Maktoum City. The Indian division of Sobha Realty, managed by his son, is also on course to becoming a billion-dollar company within the same timeframe. Menon says his legacy real estate deal is a proposed 60-storey project on Sheikh Zayed Road. The Middle East veteran is also set to start up another venture that he hopes will scale to a $1bn business – but he won’t reveal the nature or location of that business just yet.
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Sima Ved Apparel Group
Shaji Ul Mulk Mulk Holdings
As a young student, Mulk came to Dubai from India in 1982 to join his brother-in-law’s business and save up enough money to continue his education at an American business school. He saved up $30,000 within a year of landing in Dubai, but decided not to accept the offer to study at Wharton’s Business school and instead pursued an entrepreneurship journey here in the UAE. The Mulk Holdings group, of which he is the chairman, now has diversified interests in aluminium composite manufacturing, real estate, plastics, renewable energy and even sports. But the most lucrative opportunity may have arisen last month, when its healthcare division announced that it was setting up the Middle East’s first e-hospital which will comprise of a network of 2,000 doctors.
While her husband Nilesh is the chairperson of the fashion and lifestyle retail conglomerate, it was Sima Ved who founded the business and is also currently its vice chairperson. Together, the duo grew the Dubai company from a single franchise of Nine West in 1999 to a juggernaut that now retails over 75 international brands, with a footprint of over 1,750 stores across 14 countries. Besides, Ved also participates in local theatre groups and has even hosted her own chat show Hi Tea with Sima Ved, whose guests have included Sheikh Nahyan bin Mubarak Al Nahyan.
Ramesh Prabhakar Rivoli Group
Ramesh Prabhakar started the Rivoli Group in 1988 while retailing just one watch brand. As vice chairman and managing partner, he has expanded that luxury business to cover the Middle East with a footprint of over 400 stores across the region and over 1,800 employees in countries including the UAE, Oman, and Bahrain. Its jewellery, watches, eyewear and accessories retail business covers highend luxury brands such as Montblanc, Zenith, Breitling and all the major Swatch Group brands such as Breguet, Blancpain, Jaquet Droz and Harry Winston.
Ram Buxani ITL Cosmos Group
In 1959, when Buxani set sail from Bombay to Dubai, he did so with 5 rupees in his pocket. Employed as an office assistant in a small trading firm in Dubai, he began at a salary of 125 rupees per month. Three years later, he was offered either a salary raise to 400 rupees, or a hike to 300 rupees along with a profit share in the company. He chose the latter and eventually became the prime shareholder in the company, that later diversified into consumer electronics, telecoms, manufacturing and retail. The ITL Cosmos chairman is also active in the community and has published his autobiography, Taking the High Road.
L.T. Pagarani T. Choithram & Sons
Pagarani would have continued working in the UK healthcare sector had his father and founder of Choithram’s, Thakurdas, not instructed him to join the family business. At the age of 35, Pagarani took over Choithram’s hospitals and schools, and eventually became the chairman of the group, widely known for its supermarkets that have been present in the country since 1974. He also leads Choithram International Foundation, the philanthropic arm of the supermarket chain, which recently pledged Dhs100,000 to Al Jalila Foundation for Covid-19 relief efforts. More recently, Pagarani has primed the privately-held business – that reportedly has a turnover of billions of dirhams in the UAE alone – for the next-gen of professionals.
Surender Kandhari Al Dobowi Group
What began as an exploratory trip for Kandhari to Dubai in 1975 led to the formation of a multinational company – Al Dobowi – in 1976. Today, Al Dobowi is a systems and solutions provider for the tyre management, power storage, industrial rubber, material handling and fluid management industries with a presence in over 10 countries. It is also the largest battery manufacturer in the MENA region. A keen philanthropist, the gurudwara he set up in Jebel Ali feeds more than 1,500 people everyday. Kandhari also published his autobiography, The Temple of My Dreams in 2018.
Sohan Roy CEO and founder Aries Group
Roy has several feathers in his cap. As the founder and CEO of Sharjah-based Aries Group – which includes 53 companies across 15 countries – Roy has overseen its growth into maritime research, events management, media, interiors and trading. Also a writer and film director, Roy’s movie DAM999 received three Oscar nominations, while his creation of the ‘world’s largest’ steel snake boat entered the Guinness Book of World Records. Roy has also developed a unique management system called EFFISM to measure the efficiency of an individual.
Vasu Shroff Shyam Bhatia
Regal Group of Companies
Alam Steel Group
Having arrived in Dubai by ship in 1965 at age 21, Bhatia brought his unwavering passion for cricket with him. He founded Alam Steel in 1979 as a small building materials trading firm and rebranded the company in 2002 after deciding to specialise in the steel industry. On the cricketing front, he initiated the Cricket for Care foundation in 2007 which aims to bring the sport to less fortunate children worldwide, and has donated over $1m since its inception. Bhatia also curated his own cricket museum in the UAE which has one of the largest collections of cricketing memorabilia on display.
Summoned by his father in 1952 to join the family textile business while still in college, Shroff took the opportunity and arrived in Dubai soon after. From a salesman and a Hindi teacher at the Indian High School Dubai to the incumbent chairman of Regal Group of Companies, his journey has been an inspiring one. His diversified conglomerate now has operations across textiles, technology – comprising high and low-voltage systems, sportswear and accessories, as well as investments and real estate. The former chairperson of nonprofit group India Club Dubai, Shroff was also the co-founder of the Indian High School. His Regal group manages the main Hindu temple in Meena Bazaar. In 2019, Shroff was also awarded the 10-year UAE resident visa.
Where are regional sovereigns investing? Fixed income and gold have emerged as attractive asset classes for Middle East sovereigns, finds the Invesco Global Sovereign Asset Management study
iddle East sovereigns were well prepared for the Covid-19 crisis, with a drop in valuations and plenty of excess cash offering them an unprecedented buying opportunity. That’s according to the eighth annual Global Sovereign Asset Management study conducted by wealth management firm Invesco, which analysed the views of 139 chief investment officers, heads of asset classes and senior portfolio strategists at 83 sovereign funds and 56 central banks, who together manage $19 trillion in assets. In 2019, 75 per cent of Middle East sovereigns reported outperforming their targets. However, even before Covid-19 affected markets, investors exhibited caution. Average equity allocations as an overall proportion of the portfolio at the end of 2019 were 16 per cent, compared with 34 per cent to illiquid alternatives and 32 per cent to direct strategic investments. The movement away from equities was motivated in part by end-of-cycle concerns that led to decreasing strategic allocations. Looking forward, 43 per cent of Middle East sovereigns expect to increase allocations to equities over the next 12 months at lower valuations, with 29 per cent of sovereigns aiming to decrease equity allocations.
to boost returns,” says Zainab Kufaishi, head of Middle East and Africa at Invesco. “Emerging markets have become better developed and more accessible, which is driving increased interest.” Sovereigns in the Middle East are also likely to be looking to Europe for bargains, with 38 per cent increasing exposure to emerging Europe and 38 per cent to developed Europe. “The market turmoil in March and April saw asset prices fall considerably, especially as some investors sold securities to ensure liquidity. This presented opportunities to gain exposure to ‘blue chip’ companies at very good prices,” says Kufaishi.
BULLISH ON FIXED INCOME
“We see investors looking at less traditional credit assets such as emerging market debt as they look for portfolio diversification to boost returns”
Regional sovereigns remain bullish about fixed income, with 57 per cent indicating that they plan to increase their fixed income allocations over the next 12 months. The report also found that 86 per cent have allocations to real estate debt, 71 per cent to infrastructure debt and 71 per cent to asset backed securities/structured credit. Emerging market debt has wide appeal among regional investors, with 71 per cent of the respondents having EM debt allocations. “We see investors looking at less traditional credit assets such as emerging market debt as they look for portfolio diversification
The study saw both central banks and a small but significant group of global sovereigns increase their allocations to gold. On average, 4.8 per cent of total central bank reserve portfolios are now allocated to gold – up from 4.2 per cent in 2019 – with almost half (48 per cent) of banks citing a potential to replace negative yielding debt as a primary advantage. This was seen as the most important reason for moving into gold, more so than commonly-understood reasons such as diversification, return and its role as
Zainab Kufaishi, head of Middle East and Africa at Invesco
an inflation hedge. While central banks often approach gold with a pre-existing allocation, the starting position for sovereigns is rarely the same, the report stated. For many sovereigns, gold is seen as a powerful inflation and tail hedge, with positive correlations in risk-on scenarios but barely correlated/ negatively during a risk-off scenario. “Last year’s study found gold to be growing in popularity, but Covid-19 has revealed it as an asset class now staking a claim to a new role within sovereign portfolios,” says Rod Ringrow, head of Official Institutions at Invesco. “We think the development of these alternative modes of investment is likely to increase interest in gold in the coming years.” The study also revealed that 83 per cent of central banks and sovereigns globally believe immediate action is required to combat climate change, and this is increasingly being translated into investment strategies. Up to 77 per cent of Middle East investors consider themselves to be disproportionately affected by climate change, far more than the peers in the West. “Many sovereign entities in this region are beginning to give these issues more attention through organisational-level commitments and membership of international bodies and government-sponsored initiatives,” says Kufaishi. “Some of the largest funds are very prominent in their actions, but in many cases the commitments take time to feed down into the investment process.”
Dr. Thumbay Moideen Thumbay Group
Vidya Chhabria Jumbo Group
Shortly after the UAE was formed, Manu Chhabria established Jumbo as one of the first tech retail and distribution businesses in the country, and was even the first to launch Sony in the UAE the following year. Vidya Chhabria, now serving as chairperson of the multi-billion dollar group, took the reins of the company after her husband died in 2002 and has guided it to become one of the largest consumer electronic distributors in the region while also ensuring that ethical practices are strictly followed. The group, which employs over 2,000 people, has expanded to include an enterprise division that has partnered with IBM, Microsoft, Huawei and Cisco, among others, as well as a 3D-manufacturing division spread across a 60,000 sqft facility.
With a renewed focus on healthcare workers during this pandemic, Moideen can claim credit for training scores of medical staff over the last two decades. In 1999, he set up the Gulf Medical College in Ajman, the first expat to set up a higher education institute in the emirate. The group’s business has diversified into academic hospitals, clinics, pharmacies and medical tourism among others, and employs over 5,000 people. Last year, the group inaugurated the Thumbay University Hospital in Ajman – the largest private academic hospital in the Middle East – built at a cost of over Dhs1bn, which can treat over 20,000 patients daily. By 2022, the group intends to increase its hospital network to 15, and build a medical school in Ghana.
Mohan Valrani Al Shirawi Group
At the age of seven, Valrani’s family fled from Pakistan to India. Overnight, they went from a position of wealth to that of refugees. After rebuilding their lives in Gujarat, Valrani left in the mid-fifties to begin another life as an expat – this time as an entrepreneur. He cofounded the Al Shirawi Group in 1971 with his friend and business partner Abdulla Al Shirawi. Today, the group operates over 30 companies across several verticals including oil and gas, heavy equipment, logistics, and engineering, that employ over 10,000 employees – many of whom, like Valrani, are expatriates.
Executives Indians who have made their mark in the GCC by rising up the corporate ladder and company owners who hold top leadership positions
Dr. Adnan Chilwan
CEO, Al Nabooda Automobiles
Group CEO, Dubai Islamic Bank
Introducing Porsche’s first all-electric car – the Taycan – in the UAE in June, Rajaram stressed that the launch marked the “beginning of the future” for the luxury car brand in Dubai and Northern Emirates. He should know well. In his long tenure of over 20 years at the helm of Al Nabooda Automobiles, the exclusive dealer of car brands Audi, Porsche and Volkswagen in Dubai and the Northern Emirates, Rajaram has helped steer the company to a phenomenal growth of over 20 showrooms. A keen advocate of electric vehicles and autonomous driving, Rajaram has also been the recipient of many accolades in the region.
A globally recognised figure in the Islamic finance industry, Chilwan led Dubai Islamic Bank’s acquisition of rival Noor Bank to create one of the largest Islamic banks in the world and amongst the largest banking entities in the UAE with total assets exceeding Dhs275bn. Following the listing of a $300m sukuk on Nasdaq Dubai in late June, DIB also became the leading UAE-based sukuk issuer by value listed on the exchange. The recipient of numerous industry awards for his efforts in growing the international appeal of Islamic finance, Chilwan also serves on the boards of Deyaar, Liquidity Management Centre and Dar Al Sharia.
Ram Kumar Thota
Executive VP, MENAT, Russia, Ukraine and Belarus, Unilever
Founder, CEO and managing director, SRR Building Materials
A veteran of multinational Unilever, Kakkar, who joined the company in 1984, has been heading the regional business of the company across its beauty and personal care, home care, and food and refreshment segments since 2013. More recently, he has also been at the forefront of the company’s social initiatives in the region. In January, Kakkar signed a deal with Bee’ah to collaborate on a plastic recycling management system, while in May, Unilever announced the donation of 10,000 meals for communities affected by Covid-19 in the UAE by illuminating 10,000 lights on the Burj Khalifa.
Having come from humble origins, Thota, the son of a farmer in India, came to Dubai and founded SRR Building Material Trading in 2007, which has now grown into one of the largest importers, exporters, wholesalers, and retailers of building materials in the UAE. Thota, who claims to have a net worth of $1.5bn, now owns properties in Burj Khalifa along with a yacht in Dubai and a fleet of luxury vehicles. A philanthropist, Thota also helps Indians who have lost their jobs in the GCC to find new roles to support their families.
“It is not about money but about doing good deeds. If someone bumps into one of my grandchildren years later and recollects a good deed that I have done, I would have left a true legacy” FIROZ MERCHANT
President, Middle East and Africa, Mastercard
Regional CEO, MEA, Standard Chartered
Responsible for driving Mastercard’s global strategy across 69 markets, Malhotra, who also sits on the company’s global management committee, has led its transition to bring new electronic payment solutions and services to the region, spanning safety, security, data, artificial intelligence – and helping advance social progress and inclusive growth. Under his leadership, Mastercard has expanded its collaboration with governments and public sector authorities to enhance the region’s infrastructure and digital ecosystem by creating mobile ecosystems, launching lending platforms, improving security and introducing new energy and agricultural digital solutions.
Having led Standard Chartered to post a 29 per cent year-on-year increase in pre-tax profit in the Middle East and Africa last year, Kaushal is now setting his sights firmly on one of the region’s biggest markets, Saudi Arabia. The bank received a licence to launch operations in the kingdom last year, and intends on focus on infrastructure and project finance, according to Kaushal. Having been in his current role since October 2015, the veteran banker previously served as the UK bank’s regional CEO for South Asia, and has also held several senior roles at a number of international financial institutions in the past.
Director and partner, Danube Properties
Extremely bullish about the Dubai property market despite the challenges thrown by Covid-19, Rahman has been at the forefront of the affordable housing market in the emirate. Danube Properties has continued to launch new projects in Dubai in recent months – including the Dhs400m Olivz project in March – and managed to witness strong sales right until the pandemic lockdown began. With years of experience in real estate development, Rahman, who took on his role at Danube Properties in 2014, has emerged as a regular and prominent voice of Dubai’s property industry.
Amit Jain held the position of group CEO of Dubai’s Emaar Properties right until the company took the step of removing all job titles in July. Jain took on the group CEO role at Dubai’s biggest developer in June 2017 and oversees its strategy and overall management, reporting directly to the chairman and board. Having been with Emaar since 2006, he has built up an in-depth knowledge of the business while previously serving as the group COO and CFO. The chartered accountant now has a major role to play in leading the company to its next phase.
Making a mark Since the 1970s oil boom in the GCC, Indian migration to the region has risen sharply, with the Gulf now accounting for a significant number of NRIs globally
Non-resident Indians (NRIs) globally
live in the UAE, accounting for the largest share of NRIs in the world
INDIANS CONSTITUTE A THIRD OF THE EXPATRIATE WORKFORCE IN THE GULF
21.5% Saudi Arabia
THE GCC IS HOME TO 65.1% OF NRIs
5.3% Qatar 5.2% Oman
34.9% Rest of the world
Bilateral trade between the UAE and India in 2018-19
SOURCE: GOVERNMENT OF INDIA, MINISTRY OF EXTERNAL AFFAIRS (MEA), “POPULATION OF OVERSEAS INDIANS” (COMPILED IN DECEMBER, 2018). OBSERVER RESEARCH FOUNDATION
Defining the right metrics, and understanding whether your company will achieve those metrics or not, is absolutely critical to successfully implementing a digital
President, Middle East, BCW
The pandemic has not slowed the expansion of Bahrain-based Investcorp; in May it formed a JV with European asset manager Tages Group to create an investment platform with over $6bn in revenue generating assets. The new JV is “optimally positioned for accelerated growth”, said Kapoor, announcing the major move. Having joined Investcorp from Citigroup in 1992 and served as its chief financial officer in the 2003-2015 period, Kapoor has led its active investment agenda regionally and internationally. Kapoor also holds board roles at National Bank of Bahrain, Gulf Air Group, Bahrain Airport Company and Gulf Aviation Academy.
Recently named the ‘Best PR Professional in the Middle East’ in the PRWeek Global Awards 2020, John is one of the most powerful figures in the regional public relations industry. He founded his own business, ASDA’A, in 2000 and eight years later drew the attention of British multinational advertising group WPP, which acquired a majority stake. ASDA’A BCW’s achievements include being part of the team which launched the tallest tower in the world, Burj Khalifa in Dubai in 2010, and supporting the Expo 2020 Dubai bid. John is also the main force behind the annual ASDA’A BCW Arab Youth survey.
Chairman, Airolink group
Chairman, Century Financial
Having established his construction business Airolink in Ireland in 2001, Anil Pillai ventured into the Middle East region in 2008 and shifted the base of the company to the UAE. Under his leadership, the Airolink group has come a long way in terms of executing construction projects across the Middle East, Europe, and India. This year, the contractor reportedly has ongoing projects worth more than $1.36bn, with a further $1.4bn worth of projects in its pipeline. In 2019, Pillai was awarded the UAE’s gold card long-term residency visa. He was also appointed by the United Nations as a UN counselor last year.
With over two decades of financial expertise across various investment fields covering bonds, real estate, equities, currencies, commodities and capital appreciation products, Bal Krishen has emerged as a veteran in the industry, helping investors diversify their portfolios across global markets. Krishen has led Dubai-based financial services provider Century Financial’s expansion into many verticals, recently launching Century Private Wealth, with further plans to grow. He has also been actively supporting initiatives in India through his charitable institution Divine India, and is involved in the infrastructure and development projects in his home state of Jammu.
Rohit and Sharad Bachani
Raju Ramesh and Sunil Paul
Co-founders, Merlin Digital
Since establishing Merlin Digital in 1998, brothers Rohit and Sharad have focused on driving the company’s growth by discovering niche markets and recognising new and disruptive product offerings. From introducing the brand in Dubai Duty Free to moving into corporate sales, the Bachanis have led Merlin to expand its international footprint. The company has also launched a new sustainable development division, and is now eyeing the health and VR segments.
Raju Ramesh and Sunil Paul co-founded their digital systems integration company Finesse in Dubai in 2010. The company has now grown to a team of 400 with more than 300 enterprise clients. A serial entrepreneur and investor, Ramesh has more than 30 years of experience with a keen interest in seed investment in tech and biotech firms. Paul, the company’s MD, has over 25 years of IT experience and previously co-founded banking services company Y-Axis Systems.
Ones to watch The young Indians expanding their influence in the Gulf, either as entrepreneurs or as heirs to family businesses
John Paul Joy Alukkas
Founder, Ayesha Depala fashion brand
Executive director, Joyalukkas Group
Dubai-based fashion designer Ayesha Depala launched her eponymous brand in 2002, which has since evolved to develop an enviable reputation for bespoke gowns. Her creations are now displayed at stores across the UAE and India and are worn by some of the most famous celebrities across the world. With ready-to-wear, couture and bridal lines on offer, Depala wove the nuances of florals in her Spring/Summer 2020 collection.
John Paul Alukkas chose a humble beginning as a trainee post his graduation, to understand the nuances of the business. With a keen eye for retail and marketing, he has since risen through the ranks and currently manages the Joyalukkas group’s international operations with a focus on expansion. As the company, which has over 8,000 employees across 11 countries, seeks to grow further, the younger Alukkas – emulating the business sense of his father – intends to carry on the legacy.
Geet Bhalla, Digvijay Pratap
Snehal and Sunita Hadani
Founders, Hadani Group
Bhalla and Pratap launched UAE-based online travel portal HolidayMe in 2014 and haven’t looked back ever since. Using their experience in software development, finance and IT, they have spearheaded its growth to launch offices in Dubai, Riyadh and Pune. HolidayMe now works with over 200 employees, offers over 300,000 hotels and 8,000 activities, and has airport pick-up and drop facilities in 300 cities. In 2018, the company announced its merger with Malaysia-based Tripfez to expand its international footprint. HolidayMe has raised a total of $39m in funding, according to Crunchbase.
A disciple of philosophy, Snehal Hadani has come a long way. As the director of Hadani Group, an integrated marketing services agency – Snehal believes in the perennial process of learning. Backing him is his wife, Sunita, a marketing connoisseur and the group’s managing director. Spanning a career across global conglomerates such as BT, IBM, Oracle and HCL Technologies, Sunita has over 15 years of tech marketing experience and harbours a ‘can-do’ attitude while remaining passionate about changing people’s mindsets regarding the value of marketing.
“Apart from passion, the one thing that matters most is perseverance. The cliché ‘never give up’ has never been more relevant than in a startup” GEET BHALLA
Founder, The Luxury Closet
Group director, Landmark Group
Prior to founding the luxury preowned goods marketplace, The Luxury Closet, in 2011, Kunal Kapoor worked at his family’s footwear business for six years and later as a sales manager at Louis Vuitton. From a three-member team to a workforce of 80, The Luxury Closet houses more than 16,000 unique items, featuring top luxury brands, while accepting items and delivering globally. It also expanded into Hong Kong with the acquisition of online luxury marketplace Guiltless. In 2019, the marketplace launched its VIP concierge service for consumers in Kuwait.
Group director at retail and hospitality conglomerate Landmark Group, Nisha Jagtiani oversees the strategic vision of the home-grown brand Lifestyle and leads the group’s essential corporate functions such as human resources, communications, and corporate social responsibility. She is also spearheading Centrepoint’s plans to create its ‘stores of the future’. Previously, she also worked extensively with Landmark’s affordable fashion brand Splash. Jagtiani also serves on the board of the Dubai Design and Fashion Council and the Dubai Institute of Design and Innovation.
CEO, GEMS Education
COO, Jacky’s Group
Dino Varkey comes from a lineage of educators. His father Sunny Varkey founded GEMS Education, while his grandparents were also teachers who migrated to Dubai in 1959. As the CEO of GEMS Education, he is now tasked with providing strategy and insight across the company. In 2019, he led GEMS Kindergarten Starters in Dubai to become the world’s first UN climate change certified school, while GEMS and its Saudi JV partner Hassana Investment acquired Ma’arif Education Group, the kingdom’s largest private school operator last year. Dino Varkey is also a patron of the Varkey Foundation.
A prominent speaker at regional retail and tech events, Ashish Panjabi serves as the COO of UAE-based Jacky’s Group of Companies and also runs its Business Solutions division, which provides visitor management, banking and graphics solutions. He has also led the company to adopt 3D printing and robotics solutions. Panjabi also runs Jacky’s Retail, which operates Samsung brand shops in the UAE, and is a partner at printing and fabrication company Cutting Edge Solutions. A charter and board member for the UAE chapter of nonprofit TiE, he also previously served as the president of the Entrepreneur’s Organisation UAE.
“THE DIFFERENCE BETWEEN WHAT WE DO AND WHAT WE ARE CAPABLE OF DOING WOULD SUFFICE TO SOLVE MOST OF THE WORLD’S PROBLEMS”
M A H AT M A G A N D H I
Lifestyle Auto Leadership Fashion Horology Travel
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Embody Gaming Chair Herman Miller joined forces with Logitech G to create this $1,495 gaming chair that is 95 per cent recyclable
Grey Cermet, the new material used in the Richard Mille RM 11-05 Automatic Flyback Chronograph GMT, fuses ceramics and metals p.71 gulfbusiness.com
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Lifestyle / Auto
Rebooting Nissan The Japanese carmaker has had a rocky year that has brought it to the brink. However, a four-year transformation strategy has plotted out an aggressive turnaround plan. Here’s what to expect in the Middle East BY VARUN GODINHO
hen Japanese auto giant Nissan’s CEO Makoto Uchida took to the stage in May to declare the figures for the financial year ended March 2020, the numbers looked bleak. Nissan reported a JPY671bn ($6.2bn) net loss – which was not only its first loss in a decade, but painfully moreover, also its biggest in 20 years. The dramatic escape of its former high-profile chairman Carlos Ghosn from Japan in December, reports about fissures developing in the Renault-Nissan-Mitsubishi Alliance and the more recent crippling effect of the global pandemic didn’t help its cause. By the time Uchida declared the numbers, Nissan’s stock had already lost nearly
64 August 2020
30 per cent of its value from the start of the year, but he was determined to pivot the company. He announced a four-year turnaround plan that called for production to be cut by 20 per cent to approximately 5.4 million units a year, and emphasised the need to reduce about JPY300bn ($2.7bn) in annual fixed costs by measures including the closing of its plants in Barcelona and Indonesia. To steer its business within the Middle East, the company appointed Guillaume Cartier as the senior vice president and chairman of its Africa, Middle East, and India (AMI) region. Cartier held another press conference recently to discuss the new direction for the market he now oversees.
“It is not volume at any cost,” says Cartier, in contrast to the company’s earlier policy of focusing on volume growth. “It is about profitable growth and financial discipline as we have to restore a better PNL than what we have today.” Nissan Middle East FZE (NMEF) reported that for FY 2019, its domestic sales had grown 0.5 per cent year-on-year. “We have delivered a very strong performance on the domestic side for Nissan Middle East that includes the Levant markets of Jordan, Lebanon and Iraq. And we have managed to grow our share 0.5 per cent compared to FY 2018. The same applies specifically for the Gulf markets,” says Thierry Sabbagh, managing director of Nissan Middle East. The Gulf markets for Nissan’s Middle East division specifically include the UAE, Bahrain, Kuwait, Oman and Qatar. Nissan introduced its new Sunny in the UAE in May, but more importantly, launched the new Nissan Patrol in September last year by way of a global reveal in Abu Dhabi. In the Middle East, the Nissan Sunny sold 27,800 units – recording a 20 per cent yearon-year growth – and accounting for 37 per cent of the total sales volume. But for Nissan Middle East, a key indicator gulfbusiness.com
Lifestyle / Auto
of its health within the region has been the performance of its Patrol SUV – a car that has been a consistent success story for the brand within the region since its introduction here in 1951 and has even been nicknamed as the ‘King of the Desert’. “Boosted by the launch of the 2020 Nissan Patrol, our overall Patrol sales saw a year-on-year growth of 65 per cent. With a total of 13,700 units sold, this iconic SUV contributed to 18 per cent of our overall sales volume,” elaborates Sabbagh.
he pandemic has thrown a spanner in the works for nearly all auto manufacturers. Sabbagh says that the TIV was down over 80 per cent at the start of the lockdown. “After the restrictions were eased, we saw an interesting momentum along the retail side of the business. The fleet size of the business remains slightly more challenging as companies are trying to figure out the impact of the crisis on their own businesses before making any decisions,” says Sabbagh, who adds that Nissan Middle East’s fleet sales grew by 3 per cent in FY 19 compared to the previous year. Cartier meanwhile remains cautious in his outlook for a quick recovery within the region. “At the minute, I’m not managing [the business on] a yearly basis, but much more on a weekly basis,” he says, while adding that the company was now acting to “prioritise and rationalise”. “By rationalise, it means rightsizing the production capacity. Previously it would be said that we could produce eight million and seven million [units]. We had production capacity that was built for that number. But we are currently looking at five million – rightsizing our production. If we don’t do that, our costs will go up because we can’t absorb the fixed costs,” says Cartier. When asked whether part of reducing the fixed costs would mean reducing its workforce in the region, Cartier chose instead to spell out the scale of the impact of the Covid-19 on business within the region. “In the last three months, in the region that I am in charge of, the market is 70 per cent less than last year. We don’t know for example what will be the size of the market in Saudi. Initially, we were planning a business plan on a TIV that would be 600,000. Today, with Covid-19, the oil prices and tax increase, potentially the TIV will be 350,000. So your revenue is down 45 per gulfbusiness.com
For Nissan Middle East, a key indicator of its health within the region has been the performance of its Patrol SUV cent. There is no industry that can support such a decrease.” Within the AMI region that Cartier manages, Nissan currently has production plants in South Africa, Egypt and India – the latter of which provides the Middle East market with the Micra as well as the previous generation of the Sunny. As for prioritising, Cartier says that it is essential for the brand to focus on core products and technology. “We want to really capitalise on SUVs – Patrol, X-Trail, Qashqai, Navara. In term of markets, clearly, the core is the Gulf market which is key in terms of profit and a volume driver,” says Cartier.
Above: Guillaume Cartier, senior vice president and chairman of Nissan Africa, Middle East and India Below: Thierry Sabbagh, managing director of Nissan Middle East
But he is adamant that increasing volume is secondary, while capturing a greater market share is a more immediate concern. “The way I am now measuring performance is much more on the market share [we have]. Today, we are 6 per cent of the Gulf market and aim to keep a market share in the Gulf which is higher than the global average,” Cartier adds. Sabbagh reiterates the strategy in place for the Middle East. “We plan to be above 12 per cent market share in all the markets we represent – in some markets we are nearly 20 per cent, and in some markets, we are just above 11.” As part of the scaled-down production plans, Nissan will be launching 12 models over the next 18 months globally. The AMI division meanwhile will introduce eight new models over the next two years. A global strategy that will be sure to have ripple effects on the carmaker’s business within the Middle East is the now over two-decade-old Renault-Nissan-Mitsubishi Alliance which, although showing cracks over the last few years, has now coalesced over the shared burden of the damaging Covid-19 pandemic and the impact of it on their individual businesses. “Each brand has its own independence in terms of managing the company and the PNL. When you add the three brands, you have next to 10 million in sales,” says Cartier. “With the ‘leader-follower’ concept, it means that in some regions, platforms, and technologies, one company will be the leader and the other two will be the followers. In China, for example, the leader will be Nissan obviously due to its presence. If Renault or Mitsubishi wants to benefit from our industrial capacity, or relationship with the government, that’s where they can collaborate with Nissan. “You can apply the reciprocity in Europe where Renault will be the leader. It means that if the two other brands want to join and benefit, they can. The same applies to South Asia in Thailand and the Philippines where Mitsubishi is strong, and Mitsubishi will be the leader. August 2020 65
Lifestyle / Auto
“As for the technology, instead of everyone doing everything, you will specialise. So for e-power and hybrid technology, the leader is Nissan. If the follower wants to use it, they have access to it. You can have the same reciprocity on some platforms. Nissan will be leading C and D platforms – the bigger platforms – and Renault will [take the lead] more on the small platforms A and B. Everyone is not doing the same things, but everyone is doing something that the other can benefit from.”
n the UAE, Nissan has been a prominent player of the automotive scene, even being appointed as the official motor partner of Expo 2020 Dubai, which has now been postponed as a result of the Covid-19 pandemic and will begin on October 1, 2021. “Nissan will showcase the future of mobility at Expo 2020 Dubai with next-generation cars and advanced technologies across the site, all powered by Nissan Intelligent Mobility,” explains Sabbagh about Nissan’s plans for the event. “Nissan will also provide a fleet of vehicles including electric vehicles (EVs) to Expo 2020 Dubai.” As for those EVs, expect to see a production variant of the latest Nissan Ariya – the electric crossover that the carmaker revealed last month at its new Nissan Pavilion in Yokohama – which is its second fully-electric vehicle after the Leaf. The Ariya is expected to go on sale in Japan in mid-2021 and will be priced at around JPY5m (Dhs173,000). Nissan is expected to launch over eight electric models by 2023, and Sabbagh outlined the conditions under which those EVs will be rolled out in the Middle East. “It depends from market to market, and even on the subsidies the governments are offering. For example, in Jordan, commercially it makes sense to introduce an electric vehicle because of the waiver on taxation of electric vehicles – we recently launched the Leaf in Jordan. Our partners determine the right time, how we want to introduce it and whether it makes sense from a commercial standpoint. For markets like the UAE, we are studying this and will make a decision.” At the 2019 version of the biennial Dubai International Motor Show, Nissan was among the few automakers to go full throttle with an expansive presence. “Nissan was one of the rare large manufacturers to participate at the Dubai International Motor
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The Nissan Ariya is the carmaker’s second fullyelectric vehicle after the Leaf and will go on sale in mid-2021 in Japan
Show last year and that shows our commitment to the region. If the UAE government decides to have a motor show in the next two years, our commitment is definitely to encourage what the government is setting up,” explains Sabbagh. He adds that in the future, it may be likely for motor shows to transform from on-ground events to virtuals ones, where products are launched digitally. The lockdowns in the UAE resulted in Nissan pushing forward a digital transformation strategy including online car ordering, a chatbot, and a digital training academy. But the digital push, says Sabbagh, will not come at the expense of showrooms. “Certain partners have the full online experience and you can buy the car entirely
online. But again, it was interesting to see that as much as people went online – and definitely there is no way back on introducing more innovation on digital platforms – they also started going back to the showrooms [once the lockdown restrictions were eased].” While merely symbolic, Nissan also unveiled a brand-new logo last month. It won’t concretely further its turnaround strategy, but it won’t do much harm either while serving as a totem for this 87-year-old company which is, in many ways, in a decisive fight to rank among the world’s major automakers. “We have been going through different crises over the last 10 years, but we have seen that the industry has managed to recover and that’s what we’re hoping for,” concludes Sabbagh. gulfbusiness.com
PA R T N E R C O N T E N T
Guarding against the ‘new normal’ wave of cyberattacks While cybersecurity systems in place may have been enough before the pandemic, companies need to reassess their frameworks in light of the increased stress to ensure business continuity
he Covid-19 crisis has irrefutably sparked a massive workforce transformation. Millions of people have been suddenly ushered into a workfrom-home model, university students are completing their studies online, and even our social life has shifted from face-to-face interactions to virtually-hosted online gatherings. One thing has been made certain by way of this pandemic: connectivity is absolutely essential for business, and digital security is paramount for protecting the data, networks, and clouds that keep businesses moving forward. Simply put, our increased demand for digital during the ‘new normal’ has changed the threat landscape. With so many businesses and employees going online, the surface area vulnerable to attacks has expanded, and organisations need to assess their security suites and protocols with this “new normal” in mind. An increased reliance on the cloud, unprepared identity access management policies, unsecured networks, and unauthorised remote access have left networks exposed to both internal and external bad actors. Couple that with the ability to play on the fears sparked by a global pandemic, and it is all not surprising that in mid-April, Google reported that in just one week, it saw more than 18 million daily malware and phishing emails related to Covid-19 scams sent via Gmail alone. In these times, potential bad actors are targeting companies at their weakest links – whether it is thwarting operational policy and playing on a workforce ill-accustomed to remote access, or circumventing security solutions that were not designed for the sudden influx of remote sign-ins. With an Internet penetration rate of 99 per cent, the Middle East region is particularly vulnerable to such threats, and with 32 per cent of data breaches in 2019 sparked by a simple phishing email, companies need to take a
Gonzalo Usandizaga close look at the security solutions and policies keeping these attacks at bay. To add to the issue, many organisations in the Middle East may be woefully under-protected. According to IDC, over a quarter of organisations in the region have “poor breach detection capabilities” and 34 per cent lack the security expertise needed to respond to advanced threats. A robust authentication protocol is the backbone of any security solution ecosystem. Identity is everything when it comes to cybersecurity, but with new threats on the horizon and more employees working remotely, the playing field has become more complex. To manage identity and authentication in a streamlined way, organisations should have an integrated platform for identity, access, and privilege management.
Companies have the dual task of implementing strong authentication while providing a positive end-user experience. Companies that want to stay both safe and flexible in this threat landscape should adopt an intelligent, multi-factor authentication framework, like NetIQ, that can adapt to changing risks. While access management is vital, it is equally important to implement encryption solutions for data privacy and security that allow data to be both safe and accessible to those that need it to drive business continuity. A solution like Voltage SecureData encrypts data at a field level, while providing increased access to secure data that can reduce the risk of a breach. No matter what solutions organisations decide to adopt to strengthen their security suite, now is the time to take a good look at the frameworks that are in place to protect key systems and data. Even if solutions have been adequate to this point, companies need to take into account not only increased employee loads, but also the increase in security risks since the beginning of the Covid-19 crisis. What was once a fine framework may not be enough to handle this increased stress on the system. Businesses across the globe have learned some hard lessons in the first quarter of 2020. As we begin to see the light at the end of the tunnel, it is imperative that we take these lessons forward, and prepare for a more secure future. Gonzalo Usandizaga is the vice president and general manager for Emerging and Growth Markets at Micro Focus
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Lifestyle / Gulf Business Academy
How I made my first millionâ&#x20AC;Ś at 26 Entrepreneur, author, trainer and master salesman, Spencer Lodge, shares the tricks of his trade learnt during a career that has spanned over 25 years BY SPENCER LODGE
n my experience, far too many people set up businesses with great ideas and strategies, but they have a limited understanding of how they can bring money through the front door. What I have learned in my 30-year career in the sales industry, is that the most important skill needed to achieve massive success is the ability to break down goals into daily actions. I was just 26 years old when I made my first million and 28 when I had my first million in the bank, and that was possible only because I was very strategic about breaking my goal into smaller chunks. One of the main things I teach in my sales training is to use data to inform your decision-making process. I truly believe that anyone can become a millionaire if they plan well enough and stay focused on their goal. If you too want to become a millionaire, then here are the steps I took that you can also easily replicate: 1. WORK BACKWARDS
I had to determine if what I was selling had the potential to earn enough commission per sale to realistically earn GBP1m. At that point, I was selling office equipment which meant that I wasnâ&#x20AC;&#x2122;t earning enough money for me to be on commission, so my dreams of being a millionaire were very far off. When I joined the financial services industry at age 23, all that changed because I was suddenly earning roughly GBP5,000 per sale. Knowing that my average commission was GBP5000, meant that in order to earn GBP100,000, I needed to do 20 deals. For a million, I needed to do 200 deals. This is when I stopped focusing on the money and thought about the deals instead. I broke down the 200 deals I needed to make in a year and worked out the number of daily and weekly deals I needed to close. Suddenly, the process I needed to follow became crystal clear and my goal seemed a lot closer. 2. IMPECCABLE DATA ANALYSIS
I became hyper-focused on diary management and analysing data. I became obsessed with the ratio of sales to prospects, and prospects to suspects. I broke down each day into five meetings per day, 25 meetings per week. From there, I determined that I needed to convert four of those 25 meetings each week. My ratio for closing a deal was three prospects, so I needed to see no less than 12 prospects to close those four deals. I determined that I would be able to 68 August 2020
convert six of those 12 prospects into second meetings. From that point onward, I became focused on getting 12 prospects into my diary every single week and doing so as early in the week as possible to give myself the best chance of success. What I have learned in my years of sales training is that most salespeople who fail are those who don’t analyse the data in as much possible detail. The only thing that matters is that you follow the data – opinion and ego are irrelevant. Self-regulation is crucial. Stay focused, stay disciplined, and become obsessed with data.
Tips for financial growth
A young Spencer Lodge joined the financial services industry at the age of 23
3. FOCUS ON REFERRALS
Once you’ve developed amazing rapport, you can ask pretty much anyone you know for a referral. And knowing that I was four times as likely to close a deal through a referral than through a cold lead, I tried to get referrals from everyone I met. I asked everyone for introductions and referrals. In fact, I wouldn’t even do business with anyone who wasn’t willing to give me referrals, because this meant that they didn’t trust me as a financial advisor. If they didn’t trust that I was giving valuable advice, then I knew I couldn’t rely on them to refer their family and friends to me. I knew I needed 36 referrals per week in order to earn a million pounds, so I couldn’t waste my time and energy on prospects that wouldn’t help me reach my goal. 4. BUILD RAPPORT
Being a good listener and asking really good questions is crucial to success. I was able to close deals effectively by explaining to prospects how I work. I am known to be a straight talker so I would ask if I could level with them, or if they preferred a fluffy version of the truth. Unsurprisingly, they all asked me to be honest, and once you have permission to be frank, then you have the freedom to ask tough questions and build their trust. But this is the thing: great salespeople aren’t afraid to say difficult or uncomfortable things. Great salespeople say it how it is, and they are very
focused on the value they bring. This, in turn, closes deals time and time again. Your value proposition must be clearly communicated to prospective consumers, and this means understanding your customer’s problem and being able to recommend a solution that will enhance their business. 5. SETTING ACHIEVABLE GOALS
I am a big advocate for having goals, but I believe that business plans should only go as far ahead as 90 days. This means the goal can be broken down into actual tasks, with the finish line visible. Once that goal is achieved, you can pat yourself on the back, set another goal and keep going. By doing this, you are setting yourself up to succeed. If you rise once, you are more likely to rise again and again. 6. QUITTING IS NEVER THE ANSWER
I never, ever, gave up. It simply isn’t in my nature to quit. Bouncing back from massive disappointments is fundamental to helping you reach millionaire status; the more you can take the blows, the better you will perform. So never allow fear or failure to get in the way of the goals you have set for yourself, and always remember that if you are prepared to work hard enough for something, you can make it a reality.
“What I have learned in my years of sales training is that most sales people who fail are those who don’t analyse the data” gulfbusiness.com
Don’t spend money on silly things: I wasted a lot of money on material things – VIP travel, cars, clothes and watches. I loved going to fancy restaurants, exclusive nightclubs and entertaining my friends, but I realised that these things were very expensive and failed to add much value to my life. Be very deliberate about where you put your money. Get your money working for you: Some people will argue that you should save 50 per cent of what you earn. I would say save 25 per cent and invest it wisely. Don’t simply leave it in the bank because the bank doesn’t do anything for you – it costs you money to keep money. Find professionals to help you with investing, and whatever you do, do not invest your money into stuff you don’t know anything about. Continually educate yourself: Invest time into studying about financial planning, money management and other skills. The more you know, the better prepared you will be to experience success.
TURNING GBP1M INTO GBP10M:
As simple as it sounds, I replicated the formula and hired other people to do exactly the same. I had hundreds of people working under me, allowing me to take 10-20 per cent cut of what they produced. The most important part of my job at this point was to get the people on my team to deliver and exceed expectations. My job was to train, inspire and motivate those people to ensure they were constantly improving their performance. I needed to structure my team to ensure they could deliver what they needed to do. If they weren’t motivated to be successful and close deals, then I wouldn’t be able to achieve my goals. Some timeless advice is to always keep six months’ salary set aside in case of emergencies. As we’ve seen from the global situation right now, and millions of people losing their jobs and businesses, having a nest egg is more crucial now than ever before. August 2020 69
Lifestyle / Fashion
Lights, camera… Hermès
For its recent menswear Spring-Summer 2021 collection, Hermès found a novel way to present its latest collection to its global clients, right in the comfort of their living room
lobal travel restrictions meant that the usual on-ground theatrical fashion productions that luxury brands stage have taken a backseat this year. But Hermès, ever ahead of the curve, organised a unique seven-minute livestreamed performance of models showcasing the brand’s new looks as they walked through the Les Ateliers Hermès in Pantin, with Hermès Men creative director Véronique Nichanian and her staff prepping the models for a mock rehearsal of a fashion show – seemingly oblivious to the cameras that were following their movements. Nichanian, who has been at the creative helm for nearly 32 years, collaborated with theatre director Cyril Teste to stage the behind-the-scenes show unveiling Hermès’ Men’s Spring-Summer 2021 collection. Although the video showcased 18 looks, there were a total of 26 created by Nichanian which included characteristic drawstring pants, leather inserted into the rib-knit sweater, zippered waistcoats, fabric including deerskin and cotton, plenty of blue, hints of fluorescent yellow, subtle prints, one-pleat trousers and even accessories including a Slim d’Hermes watch, closed sandals and braided canvas belts. Experimental, effortless, brilliantly choreographed – you could say as much of the live-streamed production as you could of Nichanian’s latest collection.
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Véronique Nichanian teamed up with director Cyril Teste to stage this live-streamed fashion show
Lifestyle / Horology
Indestructible Lighter than titanium, and nearly as hard as diamonds – Richard Mille holds nothing back with its new grey Cermet material in its latest RM 11-05 Automatic Flyback Chronograph GMT BY VARUN GODINHO
hen it comes to material innovation, think of Richard Mille timepieces as a skunkworks laboratory on your wrist. The Neuchâtel-based watchmaker has gone to extreme lengths to research, manufacture and implement cutting-edge materials into its watches. Take for example the RM 009 which used a material called Alusic, created by spinning silicon and aluminium in a centrifuge so that the particles bond at a molecular level. Then there’s the RM 50-03 Tourbillon Split Seconds Chronograph Ultralight McLaren F1 which used a carbon-based material called Graphene discovered by two Nobel prize-winning physicists. The RM 027 Tourbillon Rafael Nadal, meanwhile, used carbon nanofibre – a material used in US military fighter jets – to create the world’s lightest mechanical watch at the time of its debut in 2010. Now, this latest RM 11-05 Automatic Flyback Chronograph GMT has a new material that the watchmaker calls Grey Cermet and which combines a metallic zirconium matrix with ceramic inserts. Cermet, created by fusing ceramic and metals, “combines the lightness of titanium and the hardness of diamond” and was used in the upper case of this timepiece. Cermet has a density of 4.1g/cm3 – lesser than that of titanium which has a density of 4.5g/cm3 – and a hardness of 2,360 Vickers, nearly as much as diamonds which have a hardness of 2,400 Vickers. Owing to its lightness and strength, Cermet is used in the aerospace industry to make shuttle components and also in the brakes of high-performance cars where they are routinely subjected to high temperatures and stress.
The Richard Mille RM 11-05 Automatic Flyback Chronograph GMT
To create this specific grey Cermet variant for the timepiece, the watchmaker teamed up with microtechnology specialist IMI Group. The zirconium carbide undergoes a process of “flash sintering” where it is reportedly heated at temperatures of upto 2,000°C. The process further combines an electrical field with hot stamping to get the final solid version of the material used in the bezel. The finished version of this material, which excludes cobalt and nickel (the watchmaker refers to these as “unwanted binders”), also adheres to Europe’s REACH chemical safety regulations. While Cermet is used in the front bezel, the tripartite case uses Carbon TPT in the mid-case. Carbon TPT comprises of up to 600 layers of carbon fibre pressed tightly together. The caseback meanwhile is made from Grade 5 titanium. Holding the entire case together are 20 spline screws which itself are made from Grade 5 titanium.
If the materials alone weren’t impressive enough, you also have a skeletonised automatic winding Calibre RMAC3 movement whose bridges and baseplate are also made from Grade 5 titanium. The watch additionally features a flyback chronograph including a 60-minute and 24-hour totalizer, an annual calendar, a GMT function, a variable geometry rotor that allows the user to customise the rewinding of the mainspring, a freesprung balance wheel along with variable inertia that protects it against shocks, and also a double barrel that ensures consistent torque over longer periods – an absolutely vital function in high-performance chronographs like this wristwatch. Limited to 140 pieces, there will be only a handful of these allotted to individual boutiques around the world. A handsome combination of ultra-complicated mechanics and futuristic materials leaves little to fault with this new timepiece. August 2020 71
Lifestyle / Horology
Breaking ground Swiss watchmaker Patek Philippe recently opened a new production facility in Geneva’s outskirts of Plan-les-Ouates BY VARUN GODINHO
odern Swiss fine watchmaking as we define it today, during its early days around 300 years ago, was essentially a series of skilled individual artisans working in silos creating specific components for watches. An attempt to centralise production and gather these artisans into a single place where they could collectively pool their efforts to create a watch entirely in-house led to the creation of ‘manufactures’. Patek Philippe, universally regarded as among the top three Swiss luxury watchmakers in the world, is one such leading Swiss manufacture. Polish immigrant Antoine Norbert de Patek, who arrived in Geneva in the 1830s, partnered with watchmaker Jean Adrien Philippe to create Patek & Cie – Fabricants à Genève in 1851, later renamed as Patek Philippe & Cie. Patek Philippe has courted royalty – Queen Victoria purchased a pendant watch back in 1851, now displayed in the watchmaker’s museum – and industry titans. The Patek Philippe Henry Graves Jr. Supercomplication, for example, was built specifically for US banking tycoon Henry Graves Jr and auctioned for $24m in 2014. Patek has also been a powerhouse of innovation. A rectangular Patek Philippe
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yellow-gold case wristwatch made on commission for the Countess Koscowicz of Hungary, was the first Swiss wristwatch. Two years ago, another timepiece, the Grandmaster Chime Ref 6300A, became the world’s most expensive timepiece when it auctioned for $31m. But records and accolades notwithstanding, Patek hasn’t let itself slip into a dreary sense of complacency over the past few decades. The brand was acquired by the Stern family in 1933, and remains an independent family-owned business at the very pinnacle of fine watchmaking. In 1996, the former president of the company, Philippe Stern, inaugurated a new production facility in Geneva’s Plan-lesOuates which, as the company says, was to “reunite under one roof the individual business activities that were previously distributed across over a dozen sites throughout the city and to thus secure the independence of the company in the long term”. Philippe reportedly spent a year’s worth of sales budget on that facility. But as the watchmaker’s business subsequently expanded, some of its manufacturing needed to be shifted to the nearby community of Perly. In 2015, Philippe’s son Thierry, who took
the reins of the company in 2009, decided to construct an expanded production facility at Plan-les-Ouates to once again consolidate the manufacturing process at a single site and to support the company’s production for at least another three decades. Five years later and at a cost of CHF500m, the new facility – built on the company’s former parking lot at Plan-les-Ouates – was inaugurated in June. Patek spent another CHF100m on the interiors and equipment installed in the building. The 10-storey unit (four of which are underground) is 189-metres long and 67 metres wide. Describing the architectural flourishes of the building, the watchmaker says, “The large-format glazing (abundant daylight is a must) interacts with white concrete passageways along the entire façade and the intermittent bronze-coloured fire escapes in the New York style. The impression is that of a huge ocean liner with clearly defined forms… the slight horizontal curvature of the passageways [are] reminiscent of the gently rounded octagon of the Nautilus case, or the balustrades of the fire escape ladders with a silhouette that resembles the form of leaf-shaped hands.” The four subterranean floors offer a 635-car-park facility, while the first and second floor above ground is dedicated to the production of components including the bridges and wheels, the manual-intensive process of polishing those parts, as well as the assembly of its bracelets and cases. The second floor also houses the restoration of antique pieces.
Bottom: (from left) The Patek Philippe Ref. 6007A-001 Calatrava; The new facility was built at a cost of CHF500m
Setting the pace for the future of the company, an R&D and prototyping department is located on the third floor, and it also houses the Patek Philippe Advanced Research department. “If you want to survive the future, you need to have a good idea about what you’re going to launch,” Thierry told Gulf Business last year, when explaining that he was already working on movements that were destined to come to market in 2023. On the floor above, you will find the rare handcrafts skills division. Sandrine Stern, Thierry’s wife, is the head of Patek’s Rare Handcrafts department that creates one-off timepieces, including clocks, using intergenerational artisanal skills such as wood marquetry, enamelling and engraving. gulfbusiness.com
“The slight horizontal curvature of the passageways [are] reminiscent of the gently rounded octagon of the Nautilus case”
A 299-person auditorium is also located on this floor. On the fifth floor, a “penthouse restaurant” can seat 880 guests and includes four VIP lounges. The objective of the new production facility is not to ramp up production – Patek makes around 62,000 watches a year including 8,000 quartz pieces. Over the last 15 years, it has increased production by around 2-3 per cent annually, and intends to keep it that way. With the current pandemic resulting in the cancellation of Baselworld earlier this year, Patek Philippe joined Rolex, Chopard and Chanel when they decided to exit from Baselworld altogether and set up a new watch show that would take place parallel to Watches & Wonders next year. Like Rolex, Patek Philippe too did not announce any new novelties this year. However, to commemorate the opening of the new facility at Plan-les-Ouates, Patek decided to introduce its first novelty for the year – the Ref. 6007A-001 Calatrava. Interestingly, this watch, limited to 1,000 pieces, is offered in steel – one of the most coveted case materials from Patek. For reference, a steel Nautilus has a waiting time of around eight years. The commemorative Ref. 6007A-001 Calatrava features a self-winding Caliber 324 S C mechanical movement that operates at 28,000vph and has a power reserve of up to 45 hours. The 40mm steel case frames the grey-blue dial with a carbon pattern at the centre of it. The white gold hands are covered in luminous material – the only Calatrava model currently in Patek’s arsenal to feature hands with this material on it. Turn it over and you’ll see an imprint of the Calatrava cross and the “New Manufacture 2019” inscription on it, referring to the time when employees began moving to the new facility. And with 2020 being a year that we’d all like to put behind us, it isn’t a bad idea to not have 2020 inscribed on that caseback. Within weeks of launching the Ref. 6007A-001 Calatrava, Patek also announced the new Ref. 5270J-001 Perpetual Calendar Chronograph, now available in yellow-gold, the Ref. 5303R-001 Minute Repeater Tourbillon – it’s worth noting that every minute repeater is passed via Stern’s desk who personally inspects its tonal quality – and even a Ref 5370P-011 Split Second Chronograph. Evidently, the new production facility is already off to a strong start. August 2020 73
Lifestyle / Auto
Living wild Ford’s new 2021 Bronco, which will enter into production at its Michigan plant early next year, will be available in showrooms after a nearly 25-year-hiatus BY VARUN GODINHO
aved roads were never quite fully on the agenda when Ford conceived the iconic Ford Bronco that made its debut in 1965. Unfortunately, by 1996, it decided to discontinue the production of the rugged two-door SUV as it conceded to a market that at the time favoured sedans and sportscars over SUVs. Consumer demand has come full circle and with a renewed focus on SUVs, Ford has – wisely – decided to revive the Bronco with an all-new two-door model for 2021, alongside its first-ever four-door Bronco too. The sixth-generation Bronco is built on the Ford Ranger platform and, as the carmaker says, is “built with the toughness of an F-Series and the performance spirit of a Mustang”. It has spared no effort in making this a thoroughbred 21st-century tough-asnails machine. Bronco’s terrain management system has what it calls G.O.A.T – Go Over All Terrain – and has seven drive modes including Normal, Eco, Sport, Slippery and Sand, with Baja, Mud/Ruts and Rock Crawl to help do just that. 74 August 2020
Production of the new models will begin at Ford’s plant in Wayne, Michigan, in early 2021
The Bronco will feature a 2.7-litre EcoBoost V6 engine, expected to generate 310hp of power
Even the 4x4 isn’t a standard one, but instead features two 4x4 setups. A base 4x4 offers a two-speed electronic shift-on-thefly transfer case. The advanced 4x4 setup meanwhile delivers a two-speed electromechanical transfer case that adds an auto mode for on-demand engagement to shift between 2-wheel and 4-wheel drive modes. A Trail Turn assist tightens turning radiuses in off-road conditions using a torque vectoring function. The Trail Control feature meanwhile – an equivalent of cruise control – is used here instead for low-speed offroad driving conditions. The SUV has a 11.6-inch ground clearance, and a maximum of 29-degree breakover angle and 37.2-degree departure angle, along with a water wading depth of upto 33.5 inches. The car has a suspension travel at the front and rear that is, it says, 17 per cent more than its competitors. Optional rock rails available for it are designed to take the entire weight of the vehicle onto it as the car’s monstrous 35-inch wheels navigate it out of quagmires. The Bronco will feature a 2.7-litre EcoBoost V6 engine, expected to generate 310hp of power and 400 lb-ft of torque, while the 2.3-litre variant of the four-cylinder EcoBoost will generate 270hp and 310 lb-ft of torque. Both of these will be petrol models and they will feature a 10-speed automatic transmission that delivers a crawl ratio of 67.8:1. Additionally, the four-cylinder variant will also feature a capable seven-speed manual transmission with a crawler gear ratio of 94.75:1. From a design perspective, Ford didn’t pick up where it left off from the model it discontinued in 1996, but rather went back to the drawings of the original one that broke cover in the Sixties – the 2021 Bronco features a vintage-style, all-original back-to-the-basics retro design. The two-door models have a three-section roof system, while the four-door variants have four removable roof sections, and an option for a soft roof too. Production of the new models will begin at Ford’s plant in Wayne, Michigan, early next year, with deliveries to showrooms expected to commence in the second half of 2021. Ford is currently offering it at a base price of $29,995. Welcome back, Bronco. gulfbusiness.com
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Lifestyle / Travel
At the Southernmost tip of the Malaysian peninsula lies the world’s second most open economy and pro-business regime; whose thriving manufacturing and logistics industries, coupled with booming new industries such as fintech and cybersecurity, have proved alluring to expat workers that have flocked to the country in droves. Singapore has become known for its 'work hard, play hard culture', with expats enjoying a thriving after-hours scene by way of nightclubs and speakeasies, and a shopping culture that nearly threatened the future of e-commerce in the country (in 2019, 85 per cent of the country’s residents shopped in stores at least once a month, compared to the 49 per cent who shopped online). Though some of the above distractions may be closed or reimagined for the foreseeable future, this tiny country – at just 50 kilometres east to west and 27 kilometres north to south – still holds a plethora of sights, eats and activities that should amuse. For those looking to stay in the city centre, Singapore announced a “Phase 2” of reopening popular sights that took place from June. Attractions including Universal Studios, Madame Tussauds, the flower dome at Gardens by the Bay, Jurong Bird Park, the Art 76 August 2020
The soul of Southeast Asia A heady mix of cultures has influenced most facets of Malaysia and Singapore, from diverse foodie scenes to inspiring historical sites BY GEORGINA LAVERS
Science Museum and the casino and observation deck at Marina Bay Sands reopened at the beginning of July with certain precautionary measures in place. For accommodation, the aforementioned Marina Bay Sands stands at the top of the pack, with its modern Stonehenge-esque exterior and world’s largest infinity pool, subject of many an Instagram snap. Moments from the Central Business
District, the hotel offers direct access to the Art & Science Museum – a favourite among parents for its interactive nature – as well as one of Singapore’s most illustrious malls, The Shoppes. Replete with designer brands from Gucci, Loewe and Moncler, the mall also is home to an indoor canal, dotted with wooden Chinese boats. Rooms run around the $400 mark. Visiting Singapore’s well-designed and gulfbusiness.com
Lifestyle / Travel
It’s been called the Isle of the Betel Nut, the Pearl of the Orient and most recently, the East’s answer to Silicon Valley. With soft sandy beaches, cheap and diverse cuisine and an interesting history, Penang is a place that caters to the foodie, the techie and the historian. The city-state has a diverse history, having been colonised by the British in the 18th Century, briefly occupied by the Japanese during WWII, and then finally gained independence in 1957. It is made up of Penang Island and Seberang Perai, a city on the mainland’s coast, and each offers a distinctive feel. Seberang Perai, fringed with mangrove beaches, has heavily industrialised over the last few decades, but still retains its natural beauty. Mengkuang Dam has running trails that weave through rubber plantations and is also home to an international dragon boat festival, whose rowers can be found noisily practising most mornings. gulfbusiness.com
Clockwise from opposite page: Singapores's bustling Haji Lane; The nature reserve of Sungei Bulo, also located in the city-state; The Nine Emperor Gods Temple in Penang
Penang has been called the Isle of the Betel Nut, the Pearl of the Orient and most recently, the East’s answer to Silicon Valley
Elsewhere, the Nine Emperor Gods Temple and the Arulmigu Karumariamman Temple are popular sightseeing spots, the latter boasting the largest and tallest rajagopuram (sculpture tower) in Malaysia. Two long bridges connect the peninsula with Penang Island, whose lush interior can be seen on the journey across. A mixture of temples, street eats and colonial architecture lends a colourful feel to Georgetown, Penang Island’s hub. A worthwhile hike is to Kek Lok Si Temple, one of the largest Buddhist temples in Southeast Asia and home to a pagoda adorned with ten thousand statues of Buddha. There are a few sandy beaches on the island to sunbathe on, from Batu Ferringhi, Tanjung Bungah or Monkey Beach – the latter named for its furry residents. A ten-minute ferry will take those in search of more Instagram-friendly backdrops to Pulau Jerejak, a small island once home to a penal colony. As well as exploring the former prison, tourists typically take a trek through the island’s jungle, or kayak off the beach. Throughout the island, Chinese, Tamil and Malay residents lend their heritage to the local cuisine, resulting in diverse, affordable dishes. One of the most popular Malay dishes
PHOTOS: GETTY IMAGES
varied malls is a popular pastime among locals and tourists, to both escape the humidity as well as try out activities within the malls. Indoor rock climbing is available at Kallang Wave Mall, and Funan Mall underwent a major makeover in 2019, transforming from tech-focused stores to experiential hangout, with urban rooftop farm and an indoor cycle track. The city can be easily navigated simply by its landmarks: use the honeycombslash-durian design of Singapore’s theatre venue, Esplanade, to get to the Singapore River, then head past the mammoth observation wheel to get to Kampong Glam, Singapore’s Muslim quarter. Check out the colourful graffiti and boutiques on Haji Lane, then head to the pedestrianised Arab Street, which boasts the Sultan Mosque and a laid-back ambience. For those looking to escape the city centre, the lush climate of Singapore makes it an ideal place for wildlife. Sungei Buloh, a wetland reserve accessible by public transport, is a good place to see Singapore’s natural habitats, from mudflats to forests. Kingfishers and sunbirds flit in and out of ponds, as well as species including otters and monitor lizards. Bring a backpack and explore the walking trails, before catching the train back to the city.
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Lifestyle / Travel
involves a steaming mound of coconut milk rice (Nasi Lemak), sometimes stained cornflower blue and usually heaped with fried chicken or shrimp, anchovies and banana leaves. Grab a bowl, and set off to explore the island with a rich backstory.
To see a traditional Malaysian neighbourhood, with houses built on stilts and outcrops of banana trees, head to Kampung Baru neighbourhood K UA L A L U M P U R
Most trips to this bustling urban metropolis begin at Petronas Twin Towers, a postmodern, Islamic set of buildings that have epitomised Kuala Lumpur’s skyline since 1999. That same year, base jumper Felix Baumgartner set a world record when he jumped off the towers, but most tourists opt for a slightly tamer experience, traversing the 42nd-storey bridge that links the soaring twin towers. Directly underneath the towers lies KLCC Park, a 50-acre garden intended to bring greenery to the district and dotted with lakes and sculptures. The scene is emblematic of Kuala Lumpur: a city that blends the manmade with the natural, and whose urbanisation is countered by a friendliness that flows through the Malaysian capital. Look beyond the city’s main landmark to discover its unique attractions, from its lively jazz scene to fondness for high tea. One of the best ways to sample the latter is to book a table in the Orchid Conservatory of Majestic Hotel, named for the mass of vivid blooms that adorn the space. Visiting markets is a popular weekend activity, where locals buy their groceries for the week and tourists indulge in a spot of 78 August 2020
From top: Kuala Lumpur's 50-acre garden KLCC Park; The more than a century old Central Market
haggling for handbags or souvenirs. Two of the biggest are Central Market and Petaling Market; look out for Malaysian batik prints, as well as Peranakan furniture. To see a traditional Malaysian neighbourhood, with houses built on stilts and outcrops of banana trees, head to Kampung Baru neighbourhood – one of the last outposts of ancestral dwellings, and constantly under threat from developers. Outside the capital is a range of attractions, one of the most popular being the Batu Caves. Around 11km outside of the city, the site is famous for the Hindu Shrines hidden in its limestone interior, which can only be accessed by a 272-stair climb to the mouth of the caves. With disciples bringing offerings adorned with peacock feathers and priests performing blessings amidst ash and incense, the effect of the shrines is only compounded by their unique setting – amid layers upon layers of limestone that has existed for millennia. gulfbusiness.com
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