Gulf Business July 2021 BBG edition

SPECIAL REPORT: THE GCC’S CHANGING ENERGY LANDSCAPE

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MAKING THE RIGHT CONNECTION Mastercard aims to ensure financial inclusion for one billion people by 2025. How? Regional head Raghu Malhotra reveals the plan

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Hydrogen hype: Is it truly the fuel of the future?

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Sotheby’s exclusive: What is the future of auctions?

Gulf Business

CONTENTS / JULY 2021

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The Brief An insight into the news and trends shaping the region with perceptive commentary and analysis

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Game on All the highlights and big reveals from the latest edition of video games convention E3

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Special Report: Energy

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The regional energy industry is in a state of flux. Where is it headed?

Raghu Malhotra, president of Mastercard MEA, reveals how the company is tackling the needs of the future

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Cover Story: Paying it forward

July 2021

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NEVER MISS AN ISSUE! Keep up to date with the latest economic developments in Abu Dhabi and the UAE

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CONTENTS / JULY 2021

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Lifestyle

Sotheby’s: Bidding big p.60

Racing time p.64

Live in the UAE p.68

“Look, this is not about trust, this is about self-interest” – US President Joe Biden following his meeting with Russian President Vladimir Putin in June

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The SME Story Interviews with entrepreneurs and insights from experts on how the regional SME ecosystem is evolving

Group director Andrew Wingrove andrew.wingrove@motivate.ae Editor Aarti Nagraj aartin@motivate.ae aartinagraj Deputy editor Varun Godinho varun.godinho@motivate.ae varungodinho Contributor Zainab Mansoor editorial.freelancer@motivate.ae zzainabmansoor Senior art director Olga Petroff olga.petroff@motivate.ae Art director Ángel Monroy angel.monroy@motivate.ae theangelmonroy Photographer Joachim Guay

General manager – production S Sunil Kumar Assistant production manager Binu Purandaran Production supervisor Venita Pinto Chief commercial officer Anthony Milne anthony@motivate.ae Group sales manager Manish Chopra manish.chopra@motivate.ae Senior advertising manager Ravi Dutt ravi.dutt@motivate.ae Group marketing manager Joelle AlBeaino joelle.albeaino@motivate.ae Group marketing manager Dominic Clerici dominic.clerici@motivate.ae

Cover: Ángel Monroy

Vol. 26. Issue 2. July 2021 Printed by Emirates Printing Press, Dubai

Editor-in-chief Obaid Humaid Al Tayer Managing partner and group editor Ian Fairservice

Photo: Joachim Guay

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July 2021

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UAE 5O YEARS

PHOTOGRAPHY COMPETITION

If you’re an avid photographer and love the UAE, submit your photograph of the nation for the opportunity to be featured in an exclusive, coffee-table book celebrating the 50th National Day. Find out how to enter by visiting: booksarabia.com/competition Submissions close July 31 st 2021

Fading value

The Brief 8 9 11 15 17

US Dollars

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Euros

Yen

UK Pounds

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6.1% 2.8% 2000

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ILLUSTRATION: GETTY IMAGES/FANATIC STUDIO

Investment Travel Future Social Energy

Global foreign reserves held in US dollars fell to the lowest point in 20 years in 2020

Greening wealth Sustainable investing is no longer optional in the GCC. Here’s how you can also get good returns in the process p. 13 gulfbusiness.com

July 2021

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The Brief / Investment

hyper-low interest rates. Borrowing is cheap for the time being – and low rates push investors and VCs to look for alternative avenues for capital returns. One such route is the fast-emerging sector of sustainable investment.

ILLUSTRATION: GETTY IMAGES/JORG GREUEL

GREEN THINKING

COMMENT

Christos Adamantiadis CEO, Marsh Middle East and Africa

The green fix Why sustainable investments should be more widespread in the Middle East

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merging from the fiscal stimulus of Covid19, a volatile shakeout awaits the global business landscape. The impact of an abrupt end to vast borrowing is considerable, but with it come opportunities to build inclusive economies by ‘fixing’ the world’s imperfect markets. These are laid out in the new Global Risk Report from the World Economic Forum in partnership with Marsh McLennan.

The report points to the enormously democratising power of the much-vaunted and Covid-expedited digital transformation – giving rise to new business ecosystems, creative capital, leveling up opportunities, and closing digital divides in developing markets.

To thrive and grow, micro-, small- and mediumsized enterprises (MSMEs) must turn to new funding alternatives to source capital. The good news is that the world economy remains in a protracted period of 8

July 2021

Climate experts have identified an opportunity for policymakers to consider what can be achieved if only a tiny fraction of those vast Covid-19 fiscal stimulus packages was invested annually in a ‘climate-positive’ recovery. The rationale is simple: if trillions could be found for Covid, why not for the climate emergency? How much could MEA countries set aside? What are the growth opportunities for regional businesses better able to embrace a more resilient and sustainable approach?

The numbers suggest that there could be room for a strategic pivot towards green investment. The UAE’s stimulus package totaled $107bn as of February 2021 (and counting), whilst as early as April 2020, Saudi Arabia earmarked $31.9bn for a pandemic stimulus package. A fraction of this could go a long way to stimulating private sector green innovation.

It’s a sector that also boosts diversification – a critical dynamic in an age of oil price volatility.

On March 31, 2021, Saudi Arabia announced plans to pump investments worth $3.2 trillion into the national economy by 2030.

But those strategies have to secure a reasonable return on investment – which is why government financial institutions that are pumping billions of dollars into GCC economies should utilise the digital transformation to get their monies’ worth. Procurement and digital enterprise platforms can ensure that government financial institutions get value for money and that economic development is more inclusive – with metrics across multiple areas of importance like the transference of skills and best practice.

MULTISTAKEHOLDER CAPITALISM

$3.2trn

Total investments that Saudi Arabia will pump into the national economy by 2030

A focus on skills is especially important – more than ever, agile economies need nimble workforces. Physical space and organisational design must adapt to hybrid working as employees transition into new roles and navigate the opportunities of automation and digitalisation – without reinforcing the systemic inequalities laid bare by Covid-19.

Of course, these are lofty goals and not easy to achieve. But many imperfections can be ironed out through a sharp, focused management of liquidity and an understanding of the long-term and highly sustainable nature of a greener, more inclusive economic model – one with conditional fiscal support mechanisms that force private companies to add value by boosting productivity and economic sustainability. gulfbusiness.com

The Brief / Travel A N A LY S I S

The ‘revenge travel’ rage

ILLUSTRATION: GETTY IMAGES/ALEKSANDR DURNOV

As vaccination numbers pick up and countries worldwide cautiously open their borders, are travellers packing up their bags for the summer?

Aarti Nagraj checks in

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ith schools shut for the summer vacations and temperatures soaring across the Gulf region, there has been a lot of discussion about travelling again. While places such as Dubai have been open since July last year for tourists, unexpected restrictions imposed by governments worldwide due to Covid-19 variants and second waves has meant that destinations are closed quite suddenly.

In its most recent report, the International Air Transport Association (IATA) announced that

gulfbusiness.com

recovery in international passenger travel continued to be stalled in the face of governmentimposed travel restrictions during the month of April.

International passenger demand in April was 87.3 per cent compared to April 2019 (pre-pandemic). On the other hand, total domestic demand picked up and was down 25.7 per cent versus precrisis levels (April 2019), much improved over March 2021.

“The continuing strong recovery in domestic markets tells us that when people are given the freedom to fly, they take advantage of it. Unfortunately, that freedom still does not exist in most international markets. When it does, I’m confident we will see a similar resurgence in demand,” said Willie Walsh, IATA’s director general.

Looking regionally, Middle Eastern airlines posted an 82.9 per cent demand drop in April compared to April 2019, which was weaker than the 81.6 per cent decline in March, versus the same month in 2019, the report found.

Capacity declined 65.3 per cent, and load factor fell 41.1 percentage points to 39.6 per cent.

“As we enter the peak summer travel season, we know that many people want to enjoy their freedom to travel. But for that to happen safely and efficiently amid the Covid-19 crisis, a more targeted approach is needed. Most government policies today default to the closing of borders. After a year-anda-half of Covid-19, there is sufficient data for governments to manage the risks of Covid-19 without blanket travel bans,” said Walsh.

“We have, for example, strong indications from the US Centers for Disease Control and Prevention, July 2021

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The Brief / Travel COMMENT

the European Centre for Disease Control and Prevention, the Robert Koch Institute and others that vaccinated travellers pose very little risk to the local population. And data show that pre-departure testing largely removes the risk of unvaccinated travelers importing Covid. Governments are naturally risk-averse, but successfully managing risk is aviation’s bread and butter. With indications that Covid19 is becoming endemic, governments and industry must work together to rebuild global connectivity while managing the associated risks. Safely restoring travel freedom and reconnecting countries will drive economic growth and job creation,” he added.

Getting there

International passenger demand hasn’t reached prepandemic levels

87.3%

THE DUBAI PERSPECTIVE

Dubai is following all the Covid-19 global initiatives while at the same time positioning itself as a destination that remains open and is welcoming tourists back to the region, explains Mark Kirby, head of Hospitality at Emaar Hospitality Group.

“The government’s efforts are outstanding, and we are seeing a good flow of guests constantly – this

Apr-2019

XX Xxx xxyxxx xxxx yxxx

Apr-2021

is very positive for the country as well as the hospitality industry. We have seen a very healthy first quarter at our hotels within Emaar Hospitality Group. A lot of guests continue to fancy a staycation or a daycation – with family and friends. Since we stepped out into beach resorts this year with Rove La Mer, Vida Umm Al Quwain and Address Beach Resort – there has been a definitive liking towards our new offerings,” he says.

The company is also expanding outside of Dubai to locations such as Fujairah, Bahrain and Istanbul, with plans to open five new hotels in 2021.

The addition of the new properties will increase Emaar Hospitality’s portfolio to more than 35 properties.

“We see that guests are adjusting to the new norm and starting to feel safe to travel, especially to the UAE. It is a trend of ‘revenge travel’, where guests who were not able to travel last year now feel the need to do so. Of course, we are still witnessing a large proportion of residents enjoying the staycation trend, which is great for our industry,” adds Kirby.

ILLUSTRATION: GETTY IMAGES/DICKCRAFT

The Brief / Future

COMMENT

Rehan Khan Principal consultant for BT and author

Always agitated With communication exponentially rising, managers end up discussing work, rather than focusing on doing work

S

tressed out executives and managers appear agitated at the best of times. It’s always telling when employees look to the mood of their boss to determine when they should raise a particularly prickly problem, such as lowerthan-expected sales figures, a project cost overrun, or the loss of a talented employee to competition.

Leaders at the same time have this unnerving feeling that they are not really leading. After all management is not just about sending emails; it’s also about undertaking a deep reflection on strategy, managing people by energising and developing them, building the team and organisational culture, as well as a host of other elements. Yet too many time-pressed executives appear stuck in first gear, doing one aspect of management only, which is communication – and mostly electronic. gulfbusiness.com

Full inbox

The average number of email messages sent and received per day has been increasing steadily 126 92

50

2005

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I often hear stories from executives who say their most productive periods at work are either very early in the morning or very late at night. Their day? It’s wiped out by constant interruptions and distractions.

We know from research that the average number of email messages sent and received per day has been inclining steadily: in 2005 it was 50 emails per day, in 2006 it rose to 69, by 2011 it had jumped to 92, and a recent study showed that in 2019, the average worker was sending and receiving 126 business emails per day. Over an eight-hour working day, that equates to about one message every four minutes.

In a 2018 report from RescueTime, which they undertook using anonymous data from 50,000 active users of their software, they found that 50 per cent of users kept checking communication applications like email and Slack every six minutes or less.

Worryingly, the average was once every minute, and more than 30 per cent were checking their inbox every three minutes or less.

In parallel they assessed that the longest duration when workers did not check emails or instant messaging – for 50 per cent of the users – was no more than 40 minutes, with the most common period at 20 minutes. They found that more than 66 per cent of users did not go for longer than one hour without some level of interruption from electronic communications.

When managers resort to this way of working, it leaves the mind agitated and in a state of constant communications dialogue. This absurd way of working shifts the brain of leaders from doing work (such as working on a strategy paper, a financial model or a performance review) to processing work or talking about it.

With communication exponentially rising, managers end up discussing work, rather than focusing on doing work, which is why some leaders have resorted to burning the midnight oil at both ends, just so that they feel productive.

Unfortunately, if your organisational culture is one where the agitated state of mind is the norm, then neglecting your inbox will result in colleagues and customers chasing you even more, as well as sending instant messages, and bombarding you with why you haven’t answered their email within five minutes of them sending it.

To move away from this bizarre way of working requires a change in culture, which can only begin from the top of the organisation. But mainly it comes from a realisation among leaders that the way we currently manage is detrimental to the health of our employees, the efficiency of our organisations and the bottom line, as we leak value from the time of talented and well-paid employees.

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The Brief / Q&A INTERVIEW

Rami Tabbara Co-founder of digital real estate investment platform Stake

Explainer: The future of property crowdfunding in the region

Crowdfunding is a necessary channel that developers need to be involved in

We believe that Covid massively helped the local and regional real estate industry. By being one of the first cities to open up and allowing tourists to come, Dubai became an even bigger destination hotspot than preCovid. This helped attract a record number of transactions in both the secondary and off-plan market in the first four months of 2021. Prices of luxury properties have seen a major uptick and people are realising how much value for money you get from investing in Dubai property. You also had a lot of residents who were renting realise that there isn’t a safer and better city in the world to live in, so they decided to become home owners. With the initial shock of Covid pushing market prices to touch a bottom in Q2/Q3 2020, many end users decided to capitalise on the opportunity and buy a home in an upgraded villa or apartment. Moreover, when Covid struck, a lot of the big developers halted new projects which delayed more upcoming supply. This was something that was heavily needed and definitely helped in rebalancing the demand and supply equilibrium.

I also believe regionally, the GCC countries did a great job in handling the pandemic when compared to other major countries globally. That gave their domestic real estate markets a big boost from both local and international investors.

risk (the time the apartment is empty); accessibility: you are able to invest in an asset class that usually has high barriers to entry from a cash perspective.

Crowdinvesting enables you to invest in properties that you have not been able to have access before due to smaller investment size; passive investment/ hassle free: you are able to buy property without having to go through the paperwork and admin involved with registering the unit at the DLD. You are also able to earn monthly income from rent without the hassle of dealing with any brokers, finding a tenant, signing leases, handling maintenance and property management. The investment is carried out digitally from end to end, from acquisition to

ILLUSTRATION: GETTY IMAGES/JORG GREUEL

How has the Covid-19 pandemic impacted the regional real estate industry?

What are the key benefits of investing via a crowdfunding platform?

There are many benefits to using a crowdinvesting platform to invest in property. The main ones are the following: Portfolio diversification: instead of locking up your capital into one property you are able to diversify across different apartments in different areas.

Diversity is the key to lowering risk.

By splitting your portfolio across different units, you mitigate for vacancy 12

July 2021

gulfbusiness.com

The Brief / Sustainability Big green push

Global ESG assets are growing steadily and could reach more than a third of the projected $140.5 trillion total by 2025

exit; transparency and control: compared to investing via a REIT, crowdinvesting gives you greater control over the portfolio selection process and a closer look into the details of every property.

2016 $22.8trn

How can crowdfunding help regional developers?

Massively. Having worked with developers for the last 15 years, I see crowdfunding as a necessary channel that they need to be involved in. In our region, real estate is one of the most sought-after asset classes. People have an affinity for property from a young age. That being said, the entry points for many are high. With crowdinvesting, developers are able to offer their properties to a much bigger audience than they were able to without. I also believe that it allows developers to ensure their investors are not overcommitting their capital into one product, which reduces their default rates. Through crowdinvesting, developers can enable investors to experience and invest in a much larger and diverse inventory selection.

Which type of properties gain the most traction?

We are seeing that investors prefer to invest in locations that offer a stable rental yield with capital appreciation and preservation. These locations are mostly ones that are in prime locations. Having said that, we are also seeing that investors are open to looking at B locations if the price is below market and has a strong rental yield.

2018 $30.6trn

2021 $37.8trn

2025 $53trn

SOURCE: BLOOMBERG INTELLIGENCE

Vipul Kapur Head of Private Banking, Mashreq Bank

COMMENT

Growth cannot come at a green cost For the private or state investor, there are three ways to make a deeper ESG impact

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ver the last decade, governments and businesses worldwide have started a shift towards more sustainable investing and have enacted multiple measures to promote the environmental, social, and governance ecosystem. The Covid-19 pandemic has accelerated this shift as it laid bare social and environmental shortcomings in the global economy, how businesses operate and how they speak to their customers. Now, with businesses incorporating Environmental, Social, and Governance (ESG) metrics into their operations, the question must be asked: is it still acceptable to aim for ever greater economic growth at all costs?

THROUGH CROWDINVESTING, DEVELOPERS CAN ENABLE INVESTORS TO EXPERIENCE AND INVEST IN A MUCH LARGER AND DIVERSE INVENTORY SELECTION

GENERATING ‘POSITIVE’ PROFITS Is crowdfunding the future of property investment in the region?

Without a doubt. We believe that the world has massively changed after Covid. Technology is going to be the driving force in everything we do. Investors will not have the patience for long and tedious processes when they invest, and they will also prefer doing it digitally. Moreover, investors are a lot more cautious in where and how much they invest. We are seeing a big demand towards transparency and lower risk.

Crowdinvesting ticks all of these boxes by enabling people to participate in real estate investment on their phone, from the comfort of their homes, and with smaller amounts. gulfbusiness.com

+$2trn

In economic value can be unlocked in the GCC with sustainable initiatives by 2030

1m

Jobs can be created along with it

The good news is that ESG principles provide businesses with growth opportunities – and they provide a roadmap to sustainability. Indeed, they open the door to sustained growth if implemented altruistically. To leverage the broad benefits that ESG policies present to businesses, governments and companies in the GCC should incorporate sustainability into the overall economic agenda; it must become a defining part of the GDP fabric – a central guiding force for good. This means looking at what multiple stakeholders are seeking in their daily lives: what do citizens need in a world increasingly concerned by climate change, sustainable use of materials and the treatment of human beings?

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ILLUSTRATION: GETTY IMAGES/MALTE MUELLER

The Brief / Sustainability

Research shows that if governments can learn what is needed to deliver good ESG outcomes, and when they holistically adopt and implement sustainable initiatives, the GCC can unlock more than $2 trillion in economic value and create more than one million jobs by 2030.

The private sector – particularly the investment community – has already spearheaded sustainable investments and the outcomes are proven. A trends report released by the Forum for Sustainable and Responsible Investment 2020 highlighted that between 2018 and 2020, total US domiciled sustainably invested assets under management, both institutional and retail, grew by 42 per cent to $17.1 trillion.

This represents almost 33 per cent of the $51.4 trillion in total US assets now under professional management, according to reports. Further, as per Bloomberg Intelligence, global ESG assets are on track to exceed $53 trillion by 2025, representing more than a third of the $140.5 trillion in projected total assets under management. The accelerated growth in sustainable investing can partially be attributed to millennials who are choosing to actively precipitate change that can have a positive impact on generations to come.

A FIELD OF OPPORTUNITIES

If we consider that a great wealth transfer is already underway with wealth passing from baby boomers to the next generation, millennials are also in a unique position to engender positive long-term change 14

July 2021

through the investment and living choices that they make. That is why the sustainable investment of public funds is now becoming a global norm, presenting GCC countries with a unique opportunity to take the lead and become change-makers.

Leading the charge enables GCC countries to reap the rewards of economic growth, industrial development, and innovation. In the past, sustainability has largely been the bastion of activists and select global agencies – but it is now within the reach of policymakers. There are three important pillars for state players in the GCC to consider when striving to achieve sustainable growth.

THE THREE PILLARS OF SUSTAINABLE INVESTING

Sustainable investing is a way to invest and seek returns while staying true to your values: this is as relevant to sovereign funds as it is to national infrastructure or economic investment strategies and private sector investment. For all stripes of investors, only companies that are aligned with ESG values should be invested in. For policymakers, this means understanding (and responding to) the reality that citizens no longer feel good about seeing their governments place future growth in unethical companies.

Citizens are conscious of their social, environmental, and governance impact.

Governments and private investors must never lose sight of this increasingly important social dynamic.

For the private or state investor, there are three ways to make a deeper ESG impact: • The first is exclusion – stop investing in regions, countries, and companies that are not aligned with your values.

• The second is integration – invest in regions, countries, and companies that reflect your values in terms of ESG concerns.

• The third is impact – choose to invest in companies that are making a measurable impact.

Commonly, ESG filters are applied to exclude or integrate companies. The first step is to select companies that have robust financial metrics and can generate longterm growth. The second step is to further filter these companies based on ESG criteria. These include: • Environment: Recognising the need to address the challenges related to environmental impact, several companies are adopting measures or creating solutions to reduce emissions and protect the environment.

• Social: The policies followed by companies in terms of diversity and inclusion and employee and vendor engagement can have an impact on society. Thus, a company’s social code and culture become highly relevant.

• Corporate governance: Enduring companies follow good corporate governance practices that are well-aligned with shareholder objectives and can create value for all stakeholders.

By adopting sustainable investing, high net worth individuals (HNWIs) can generate long-term positive returns while proactively taking steps to limit the impact of unsustainable practices on society and the environment. For example, those concerned about the water crisis can easily find ways to invest in companies that are working towards creating irrigation or desalination solutions. On the other hand, if you are passionate about addressing the climate crisis, then you can channel your money into companies that are focused on alternative energy or those that have set clear objectives in terms of reducing their carbon footprint.

The transition to sustainability is happening at a rapid pace and the GCC cannot afford to be passive about sustainable investing. gulfbusiness.com

The Brief / Social Zaib Shadani Managing director of Shadani Consulting

COMMENT

accounts completely. But for those of us who can’t go cold turkey, here are some tips to reduce social media consumption and moderate its influence.

Tip 1: Turn off all push notifications Push notifications are the messages that pop up on your phone as alerts. It’s when your phone ‘pings’ and alerts you about the latest news, post or story.

Chances are you’ll stop what you’re doing to look at your phone to see what the notification is about.

By disabling push notifications, you will be able to decide when you need to look at your social media apps, allowing you to regain control over your time and attention.

Tip 2: Remove the apps from your home screen Most people have their social media apps on their home screen and can’t help but browse whenever they’re bored or have some time on their hands. It’s helpful to move your apps from your home screen and put them into one folder so that they’re not always visible. Following the old adage of ‘out of sight, out of mind’, the less you see the apps, the less tempted you will be to access them.

Social media detox tips Here are eight ways by which you can limit your use of social media and avoid mindless scrolling throughout the day

W

hat’s the first thing you do in the morning? Chances are you’re going to reach for your phone to check your social media notifications, before aimlessly scrolling through Instagram, Facebook, TikTok, YouTube or your platform of choice.

Social media apps are addictive and here’s a little secret – they are designed to be that way. The past year really brought social media into the limelight and it became our way to connect, keep in touch and escape the reality of a global pandemic. The downside? It’s not all real – it’s a curated reality that showcases what people want to show us. In many cases, an overload of social media can lead to stress, anxiety and feelings of not measuring up. As a result, some people have deleted their social media

gulfbusiness.com

Tip 3: Be vocal about your detox An important step in the journey to social media detox is to tell people and be open about the fact that you’re choosing to be offline for a while. It’s important to not ‘disappear’ without informing your social media tribe not to worry and also ensuring that you have the necessary support to stick to your goals.

Tip 4: Your phone is not your bedfellow Do not take your phone to bed with you. Leave it out of arm’s reach and put it away at least an hour before you go to bed. Your phone’s screen should not be the last thing you see at night. And for those people who say that their phone is their alarm clock and thus can’t be out of reach – the solution is simple: buy an alarm clock.

Tip 5: Reduce the number of apps A lot of us have a plethora of apps that we don’t necessarily use, but still have on our phones. Go through all your apps and delete the ones you haven’t opened in the last two weeks. Go a step further if you can, and choose between the social media apps that you absolutely cannot live without and the ones that you can cut out of your life. Do you really need TikTok, Snapchat, Instagram and Facebook?

If the answer is yes, then keep them. But if you are on the fence, suspend an account for a week and see how you feel.

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The Brief / Startups INTERVIEW

Tip 6: Start small – Go offline for a day Going offline and taking a break from social media isn’t as easy as it sounds. FOMO (fear of missing out) is real and for so many of us, the thought of not being connected for a few days and not knowing “what’s going on” is daunting. So, take baby steps – start with one day and see how it goes. Slowly you can build your way up to a few days and incorporate it into your lifestyle.

Tip 7: Find a detox buddy The chances of having a successful social media detox are higher when you have a detox buddy.

Having someone who is on the same journey will help motivate and ensure accountability, where both of you are rooting for each other’s success. It will also help to have someone who understands what you’re going through and the motivation behind it.

Tip 8: Plan what you will do with all that extra time It’s surprising how much time one has when not occupied with social media. Get outside, find a hobby, be creative, spend time with friends – the sky is the limit. But make sure you are using your time productively to pursue something that you enjoy, otherwise it’s very easy to fall back into bad habits.

A N A LY S I S

The growth path Regional economies are offering enabling ecosystems for startups, championing innovation and growth, finds Zainab Mansoor

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he GCC’s startup ecosystem is rapidly maturing, backed by supportive regulatory frameworks, private-public sector collaborations and incubator programmes. The UAE, in particular, has taken substantial steps to offer a fertile ground for local and foreign talent to set up shop.

Among a series of local initiatives undertaken recently was the launch of an integrated digital platform, Dubai Next, to allow youth innovators and entrepreneurs of any nationality to secure funding to launch their projects in Dubai. The platform offers crowdfunding solutions and is being considered as an ideal option for students and innovators to present their projects to potential investors.

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Last month, Dubai’s Intelak Hub, a startup platform dedicated to the travel, tourism and aviation sectors, and sponsored by principal partners Emirates Group, Dubai Tourism, Accenture and Microsoft, opened registrations for local, regional and international startups to apply for its cohorts of programmes.

Meanwhile, 10 technology startups graduated from this year’s Techstars Hub71 accelerator programme in Abu Dhabi, with participating startups hoping to secure a whopping $15m in funding.

Across the GCC, such strong initiatives have helped the region gain global traction as well. The UAE ranked 25th globally and second in the Middle East and Africa (MEA) region for its startup ecosystem, according to StartupBlink’s Global Startup Ecosystem Index Report

2021, which ranks the top 100 countries and 1,000 cities worldwide. Bahrain and Saudi Arabia held the seventh and 10th spots respectively within the MEA region.

Meanwhile, Dubai jumped 32 spots from 99 to rank 67 globally within the city rankings in 2021, and is now the third highest ranked city in the MEA region. Dubai also ranks among the top 50 globally for software and data.

“As a leader in the Arab region, the UAE’s startups are growing fast. With a high concentration of technological innovation, Dubai is the strongest ecosystem hub city in the Arab world and a popular relocation destination among Arab entrepreneurs from all over the Middle East who are scaling their startups. Abu Dhabi is also becoming an accomplished and successful startup ecosystem hub and is home to multiple accelerators and incubators as well as a very large local market,” the report read.

Meanwhile, Bahrain provides many benefits for founders who want to establish a startup, including complete foreign ownership, zero taxes, and an attractive regulatory environment, it added.

With strong backing from regional governments and promising incentives underway, the regional startup landscape looks set to soar.

gulfbusiness.com

The Brief / Energy

ILLUSTRATION: GETTY IMAGES/ASTAMAIS

“WE’RE HAVING TO BRING IN PEOPLE FROM OTHER SECTORS, WHETHER IT’S OIL AND GAS OR OTHER PARTS OF THE ENERGY INDUSTRY, OR RECRUITING DIRECTLY FROM UNIVERSITIES”

A N A LY S I S

Green skills

Rising demand for renewable energy may be impeded by a shortage of skilled workers

C

lean energy giants are finding a shortage of workers with the skills needed to support their ambitious growth plans.

The renewables jobs market is heating up and candidates with the right abilities are becoming harder to find, according to Miguel Stilwell, chief executive officer at Portuguese clean-energy firm EDP Renovaveis. The company is one of the world’s top installers of green power and plans to hire 1,300 employees over the next two years. gulfbusiness.com

“There’s a war over talent globally,” Stilwell said in an interview. “The renewable sector, given the massive amount of growth that is expected, doesn’t have enough people.”

As countries funnel billions of dollars into developing renewable power, policymakers are banking on the sector to create new jobs that are crucial for the post-pandemic economic recovery. Solar generation capacity is expected to triple by the end of the decade, while wind capacity is expected to more than double over the same period, according to clean energy research group BloombergNEF. Green supermajors such as NextEra Energy, Iberdrola, Enel SpA and EDP are leading the race to electrify the global economy. But some large oil companies are starting to get into the sector too, with BP announcing in May it’s looking to fill 100 offshore-wind jobs in the UK and the US, a figure that could double by the end of the year.

Engineering skills such as energy assessment, project management and project design are in high demand, EDP’s Stilwell said. Good business developers who understand clean energy technologies are also a scarce resource. Other roles, such as managing mergers and acquisitions, or back-office tasks, can easily be hired from other industries.

Engineering and chemistry graduates working on a masters degree in renewables at the Universitat Politecnica de Catalunya in Barcelona are often hired while they’re still in school, or right after they finish, according to Professor Jordi Llorca. The university has partnerships with other colleges in Europe and students often get hired to work in other countries like the UK or Denmark, said Llorca, who is also the director of an engineering research centre at the university.

“We need to be fast to adapt the contents of our programmes on the energy transition and renewable energies to make sure our graduates are competitive in the market,” Llorca said. “We’re constantly looking at the contracts and agreements we have with different industries to see what’s needed.”

The university launched a masters in hydrogen energy last year after professors realised very few people have the skills in mechanics and chemistry that the fast-growing sector will need very soon.

July 2021

17

The Brief / Alan’s Corner

“There’s always a moment of vacuum whenever a new technology comes in, but we’re able to put together new programmes in just a few months.”

Offshore wind farms are another growth area. The projects involve erecting and maintaining wind turbines the size of skyscrapers miles out to sea. A single turn of one of the massive blades could power a house for two days. The industry was pioneered in Europe, but is now rapidly expanding to Asia and the east coast of the US. Those new markets don’t have people with experience. That means that developers are often sending British and European employees to lead the way, according to Clint Harrison, director at renewable energy-focused recruitment firm Taylor Hopkinson. But as business takes off there’s pressure to hire locally. The limits of a well-trained workforce could end up being a bottleneck in an industry that is key to slashing emissions.

“There’s a sense of urgency,” Harrison said. “The market is growing very, very quickly and we need to ensure we have the right people across various projects and regions to ensure projects move forward and aren’t delayed.”

Growing needs

More skilled workers will be needed in the offshore energy sector in the UK

160,000 2021

200,000 2030

SOURCE: ROBERT GORDON UNIVERSITY

In the UK alone, around 200,000 skilled workers will be needed in the offshore energy sector by 2030, up from 160,000 today, according to a recent report by the Robert Gordon University in Aberdeen. About half the jobs are expected to be filled by people transferring from the oil and gas sector and about 90 per cent of current workers in the fossil-fuel sector can be retrained for renewables, said author Paul de Leeuw.

“Demand for courses on renewable energy and the energy transition is ramping up rapidly and at the same time we see demand for oil courses declining,” he said. “It’s a societal and industry shift mirroring in the education system.”

Bloomberg 18

July 2021

Alan’s Corner Alan O’Neill Change consultant and speaker

Making organisational change effective Market dynamics can dictate the need for a restructure of your organisational chart

A

merican Express started out delivering mail across the US on horseback and then evolved over the years. Remember American Express traveller’s cheques?

With travel at its core, it has reinvented itself to become one of the top charge-card companies in the world today.

Market dynamics can dictate the need for a restructure of your organisation chart. Changes to customer habits, new legislation, supply chain challenges and technological advances can all combine to force the need for change. When the market dictates it, survival and growth may well depend on your ability to adapt and possibly reinvent your organisation structure.

Change like this is not easy and blurred lines can often emerge in terms of roles and responsibilities.

Organisational change like this is more effective when it is planned, taking due consideration for the impact of the changes across the board.

WHEN THE MARKET DICTATES IT, Steps to take when restructuring SURVIVAL AND GROWTH 1. DISCOVER Discovery is about taking time to get a fresh objective MAY WELL look at the business and better understand the busiDEPEND ON ness model, culture, the current structure, reporting YOUR ABILITY lines and job roles.

In a change programme we did recently with TriTO ADAPT angle Computer Services, we conducted a number AND POSSIBLY of one-to-one interviews with team members – to REINVENT get their views on what is working and where there might be confusion or overlap.

YOUR ORGANISATION 2. DESIGN STRUCTURE The answer to ‘which comes first, the chicken or the egg?’ is easy when deciding on structure. Structure gulfbusiness.com

The Brief / Alan’s Corner

individual’s names were then added once the new structure was finalised.

It’s essential to do it this way rather than be influenced by personalities and past roles. Just because someone has had a particular role for years, should not suggest that with a refreshed business model, they automatically continue in that role.

3. DELIVER

The new structure then needs to come to life. This starts with communicating it carefully and with great empathy to your people and customers. This brings great clarity to an organisation as individuals get comfort from knowing who they report to and the path for succession.

4. DEVELOP

ILLUSTRATION: GETTY IMAGES/ASTAMAIS

A new structure takes time to develop. Once the organisation structure is defined, it’s important to re-write the job descriptions for each role. Individuals need to know exactly what is expected of them, what competencies are required to fulfil the role and what the measures of success are.

The last word

(who does what and who reports to who) is only relevant when the vision and the strategy for the business is carved out.

Taking time out with the senior management team in Triangle, we started by crafting a new north star for the business.

Once that was agreed, we identified the gap between the current structure and the ideal one required to deliver the new strategy. We shaped an organisation chart that focused not on names but on roles and reporting lines at first. The appropriate gulfbusiness.com

I have been privileged to support many organisations over the years to refresh their strategy, culture and structure. It’s an inclusive process that takes due consideration of all key stakeholders. It starts with understanding the market and competitive context for the change. But it doesn’t stop there.

When a business is dependent on people being motivated and skilled, there is more to do. Communications is a key enabler of successful change.

Check back in here over the next few months and I’ll go into more detail for each of my 7-Steps to Profit.

July 2021

19

Exclusive paintings, sculptures and photography from award-winning international artists.

Painting by Almudena Angoso

Photography by Donell Gumiran

Painting by Sonu Sultania

The 50th Anniversary Navigator Clock

By David Galbraith

BRAND VIEW

Phi Trends: A balanced approach 2020 has clearly depicted that investors must focus on prioritising companies with sound business models, writes entrepreneur and investor Shailesh Dash, who shares his perspective in this monthly column

T

he year gone by, 2020, was primarily overshadowed by the Covid-19 pandemic. Thankfully, a lot has changed now, with light at the end of the tunnel thanks to vaccine rollouts and the reopening of economies.

The fall in equity markets started in late February 2020, and continued into most of March 2020 before rallying strongly in the subsequent months. After a strong performance witnessed in 2020, the year 2021 started with renewed bouts of volatility, especially concerns over slow vaccine rollouts, new waves of virus in some countries and delays in fiscal support from the US Fed. The performance during the first part of 2021 (until May 23, 2021) was largely supported by encouraging economic indicators and robust earnings during the first quarter.

The Dow Jones Global Index appreciated by 10.8 per cent this year (as of May 23), after rising by 14.1 per cent in 2020. While the Dow Jones US index rose by 12.9 per cent this year compared to 18.3 per cent in 2020, the European markets were up by 11 per cent

compared to gains of 3.1 per cent in 2020.

For the emerging economies, equity markets are experiencing pull-backs after recording strong gains in 2020, which can be attributed to policy tightening by China and virus-led

Tracking the global markets DJ Global Index MSCI EM Asia

DJ US Index

DJ GCC Index

MSCI Emerging Markets

MSCI Europe

Shanghai Shenzen CSI 300

31/Mar/2020

30/Jun/2020

MSCI Asia Pacific ex Japan

Crude oil

160 140 120 100 80 60 40 20 0

31/Dec/2019

gulfbusiness.com

30/Sep/2020

31/Dec/2020

30/Apr/2021

restrictions impacting growth in certain parts of the region. GCC equity markets are witnessing strong performance with gains of 21.1 per cent in 2021 (as of May 23) after declining by 0.9 per cent in 2020. This can be attributed to the roughly 50 per cent rise in oil prices coupled with measures adopted by the regional governments, especially the UAE and Saudi Arabia, to attract investments into the region.

WHAT NEXT? Investors should clearly understand the divergence in pace of economic recovery around the globe. For instance, the US and China are witnessing a much quicker recovery compared to Europe. The supportive monetary policy by central banks will further boost economic activity. The extent of economic recovery is likely to deepen and broaden during the next two quarters, crystalising the divergence within the global economies.

There are broadly two concerns clouding the equity markets – inflation and new Covid19 variants that could lead to short-term volatility in the second half of 2021. Inflation has emerged to become a rising concern, and investors are finding it difficult to interpret its impact on the broader markets because of mixed views from experts and market participants. There is a growing belief that the inflationary pressure could be transitory and the slack in global economies could reduce the pricing power from companies going forward. This thesis is broadly supported by the fact that the US is operating at below full employment while wage growth is limited.

Another risk to economic recovery is the lingering concerns of Covid-19 variants, which might be resistant to vaccines, coupled with the slow rollout of vaccines in some parts of the world.

Going forward, there is no doubt about the world heading into a full recovery from Covid19 during the second half of 2021. However, investors must be prepared for higher uncertainty in equity markets, with no meaningful corrections in the near term. Regardless of the course of the markets, 2020 has clearly depicted that investors must remain focused on prioritising companies with sound business models which have the ability to emerge strong from any crisis or recession. It is important for investors to understand the changes that are expected to remain and reflect those by rebalancing their portfolios. For example, tech stocks will continue to remain relevant, given their dominant position in the new normal.

June 2020 21

The Brief / Infographics

Seeking a better life: Living abroad

Crossing borders The countries that host the largest pool of expatriates and the nationalities that account for the largest diasporas TOP 10 HOSTING COUNTRIES 1 Germany

The Expat Insider 2021 survey reveals the best and worst expatriate destinations for living and working and hotspots that fared exceptionally well amidst a global health crisis

RELATIONSHIP STATUS

Male 52%

Single 37%

46.1

Spain

5

Switzerland

6

UK

7

UAE

8

France Italy Canada

2

British

3

Germans

4

Indians

5

Italians

6

French

7

Canadian

8

Australian

9

Dutch

10

Average age of expats

South African

PLANNED LENGTH OF STAY

With dependent children abroad 20%

Without dependent children abroad 80%

Netherlands

4

TOP 10 LARGEST DIASPORAS 1 US Americans

In a relationship 63%

FAMILY STATUS

3

10

An overview of the expatriates living outside their home country

Female 48%

US

9

Mapping the demographics

GENDER SPLIT

2

26-40 37%

25 and below 4%

AGE GROUPS

61 and above 18%

Up to a year

4%

2 to 5 years

22%

More than 5 years

34%

Possibly forever Undecided

41-60 41% 0

20%

19%

10

20

30

PRIMARY MOTIVATION FOR MOVING ABROAD Job and career

LEVEL OF EDUCATION Bachelor’s degree or similar 34%

Postgraduate degree, master’s degree or similar 42%

Lifestyle choices

PhD or similar 7%

High school graduate 7% No degree at all 2%

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July 2021

83%

Other 0

24%

9%

Education

Love and family Commercial, technical or vocational training 8%

36%

24%

7% 10

20

30

with an university degree gulfbusiness.com

Where to, next?

Average globally

These are the countries that top the list of places where expats live

Feedback from surveyed expats are highlighted for each country

1

2

3

4

5

TAIWAN

MEXICO

COSTA RICA

MALAYSIA

PORTUGAL

Easy to live without speaking the language

Satisfied with the local leisure options

Find it easy to settle down

Satisfied with their job security 83%

Easy to get used to the local culture

85%

82%

Happy with their life in general

Good quality of medical care

Good natural environment

89%

96%

An expat from Chile:

An expat from the US:

“The Taiwanese healthcare system truly considers people as human beings instead of mere numbers”

“The culture and friendliness of the local people [is my favourite aspect]”

92%

Affordable cost of living 82%

96%

Income is enough or more than enough

Easy to make local friends

85%

70%

An expat from the US:

“I love the social life and culture”

87%

Find the locals generally friendly 87%

Feels at home 83%

An expat from the US:

An expat from France:

“It is easy to live here, and the people are wonderful”

“I like the weather and the laid-back lifestyle”

Calling the Gulf home With the exception of Kuwait, the majority of expats in all Gulf countries are satisfied with their lives

KUWAIT

BAHRAIN

SAUDI ARABIA

39%

76%

65%

QATAR

OMAN

17th

24th

79%

80%

UAE

82%

GLOBAL OVERALL RANKING (In total, 59 countries were ranked across various categories)

59th

42th

12th

18th

The Covid-19 impact

0

20

40

63% 60

7% Mental health

20%

9% Personal finances

BEST OFFICIAL COMMUNICATION

Other

16%

Were not affected in any of the above ways

Work/business

Will move back home sooner than initially planned 5%

23%

Will move to another foreign country 6%

Social life

Changed plans to move to another foreign country 8%

25%

BIGGEST IMPACT RIGHT NOW

Decided not to move back in the near future 18%

Personal travel

EFFECTS ON CURRENT EXPAT STAYS

1 2 3 4 5 6 7 8

New Zealand Taiwan Qatar Singapore Saudi Arabia Bahrain Australia UAE SOURCE: INTERNATIONS’ EXPAT INSIDER 2021 SURVEY

gulfbusiness.com

July 2021

23

The Brief / Lightbox

Activists put the finishing touches to a sand drawing of the G7 leaders and calling on them to ‘share the vaccine and waive the patents’ at Watergate Bay beach near Newquay, Cornwall on June 10, 2021, ahead of the threeday G7 summit which was held from June 11-13 24

July 2021

gulfbusiness.com

gulfbusiness.com

July 2021

25

PHOTO: BEN STANSALL/AFP VIA GETTY IMAGES

COVER STORY / MASTERCARD

T OMOR ROW

Financial inclusion is a not a topic that Raghu Malhotra, president of Mastercard Middle East and Africa, takes lightly.

In this exclusive interview, he speaks of the importance of ensuring an equitable financial future, of leveraging key technologies and offers advice to leaders on handling a crisis

T O D A Y WORDS BY ZAINAB MANSOOR

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July 2021

P H O T O S B Y J O A C H I M G U AY

gulfbusiness.com

COVER STORY / MASTERCARD

H

COVER STORY / MASTERCARD

arbouring a vision of a financially inclusive, digitalised society and working relentlessly towards realising this mammoth task are two distinct realities. Raghu Malhotra, president for Middle East and Africa (MEA) at technology giant Mastercard, has the unique opportunity of not just having that vision, but also bringing it to life.

“We want to get one billion people financially included into the formal economy by 2025,” says Malhotra, who is currently overseeing the company’s growth strategies across 69 countries.

That the Covid-19 pandemic and its economic implications left the world reeling is nothing new. In the weeks and months following the outbreak, a new ecosystem seemingly cannibalised the old, causing a departure from the traditional ways of how people worked, shopped, and lived.

While it posed an existential question for some, it created a challenge of distinctively different but overwhelming proportions for companies such as Mastercard, which were keen to help millions of people transition seamlessly towards a new world order.

“If I just step back and think of the pandemic, it has had an adverse impact on various global economies and people, but in many ways, it has also been a catalyst of change. Everybody understood that the cost of cash was very high. I think what the pandemic did for payments was that it changed consumer habits – in the Middle 28

July 2021

East and Africa, 73 per cent of people are shopping more online than they did prior to the pandemic. That’s a staggering number,” adds Malhotra.

E-COMMERCE: RAPID GROWTH Digital adoption on an individual and institutional level were arguably the redeeming features of the Covid-19 pandemic. Consumer spending habits are now digitised and the opportunities for stakeholders – be it retailers, financial institutions or fintech operators – to leverage the space are unprecedented.

“Our current estimate is that between 20 to 30 per cent of the Covid-related surge in e-commerce spending is going to remain permanent. And that’s just the immediate shift. As people get their infrastructure in a better place, the consumer experience will get better, and then you should expect more of a change to come through,” predicts Malhotra.

According to Mastercard’s New Payments Index, 97 per cent of UAE-based consumers are considering emerging payments such as wearables, biometrics, digital wallets and currencies, and QR codes. In Q1 2021, Mastercard witnessed one billion more contactless transactions globally, compared to Q1 2020.

Malhotra adds: “The three trends that I see on the payments side are that, firstly, e-commerce has gone up a lot. But more importantly, it’s not just that it’s scaled

during the pandemic, because you’re sitting at home and you still need to shop; it is now that consumers have tried it and are comfortable with it, and as we go forward in the future, it will be a channel that consumers will use more often than they have ever done in the past.

So, in effect, the quantum shift from one channel to the other is one part that’s come through. The second is contactless – when one suddenly starts to think that physical contact has issues, cash has issues. And the third trend is domestic spend, which has actually gone up.” Mastercard’s domestic volumes in MEA grew by 38 per cent year-on-year in Q1 2021.

However, the rise in online transactions and digital payments has been accompanied by a surge in threat actors who, as is often the case, have exploited uncertainty and global events to perpetuate malicious activity. According to a McAfee report, with global spending on cybersecurity expected to have exceeded $145bn in 2020, cybercrime is now a $1 trillion drag on the global economy.

To mitigate cyber threats, Mastercard has launched several initiatives. In 2020, it unveiled Cyber Secure, an AIpowered suite of tools enabling banks to assess cyber risks and prevent potential breaches. In 2019, the company protected stakeholders from $20bn worth of fraud through its AI-enabled cyber systems. Regionally, it launched its Global Cyber Forward programme in partnership with Dubai International Financial Centre (DIFC) earlier this year, combining its capabilities in cybersecurity with those of public sector organisations to create secure digital ecosystems.

“Our programme is actually looking at cybersecurity at a national, city and an ecosystem level for institutions,” opines Malhotra. “We use sophisticated artificial intelligence (AI) and machine learning techniques to actually do predictive behaviour. The kind of technology that is coming through is taking machine learning and data and converging them together to give customers a better experience.”

THINKING BIG Eclectic business ecosystems are built as a concerted effort undertaken by private and public stakeholders and underpinned by supportive regulatory gulfbusiness.com

Pay on the go Most UAE consumers are considering payments using wearables, QR codes, biometrics, and digital wallets and currencies

Will use emerging payments

97%

SOURCE: MASTERCARD’S NEW PAYMENTS INDEX

“WE WANT TO GET ONE BILLION PEOPLE FINANCIALLY INCLUDED INTO THE FORMAL ECONOMY BY 2025”

July 2021

29

COVER STORY / MASTERCARD

Mastercard’s Dubai HQ displays regional artwork in support of Middle Eastern artists

“I also feel that sometimes you should be okay with imperfection. Great innovation is born out of imperfection” frameworks and enterprising entrepreneurs. More so, to keep pace with the speed of digitalisation, investment in emerging technologies and key growth sectors is imperative to secure consumer retention and economic viability.

“The amount of money various industries are spending on tech to digitise is huge. Also, governments now realise that they have to build very resilient economies. To build such economies, which are beyond oil and travel, they have to start identifying sectors that actually drive growth and get the small and medium sized enterprises (SMEs) going. SMEs employ a lot of people and not all were able to sustain themselves during this [Covid crisis],” opines Malhotra.

SMEs are a mainstay of long-term growth across countries around the globe. According to official statistics, the wider SME sector contributed an estimated 53 per cent to the UAE’s GDP in 2019, up from about 49 per cent in 2018.

Meanwhile, SMEs also accounted for approximately 95 per cent of the companies in the country. Keeping its sights on the potential of the SME sector, Mastercard has donned the role of an enabler, fostering the entire landscape.

30

July 2021

“We believe in ‘doing well by doing good’. As part of that, there are a few commitments that we’ve made. Firstly, we want to get one billion people financially included into the formal economy by 2025. Secondly, we want to enable 50 million SMEs to enter into the formal ecosystem globally,” notes Malhotra.

“SMEs require access, money and expertise to go online. At Mastercard, we work with partners in the public and private sectors to provide solutions and technologies for SMEs. To give you one example, we have ‘Simplify Commerce’, an API-based application where an SME can be onboarded in 10 minutes and can start accepting digital payments. Lenders are also happy because they can see a transparent flow. We are almost creating a whole ecosystem that allows everybody to participate and such partnership models drive what I call sustainable and equitable growth.”

The conditions for fintech growth in the GCC are equally opportune with a technology-savvy consumer base at the helm, high smartphone penetration and growing consensus among key stakeholders for an all-inclusive society. However, Malhotra believes that fintech operators

involved in digitising SMEs and supply chains, those involved in the cybersecurity end as well as microlenders who do crowdfunding, will fare particularly well.

What will provide a further boost to support the ecosystem going forward is the strong backing of an enabling support structure. “[Key fintech enablers] include governments and entities that offer incubation pilots because they drive innovation and efficiency in the economy. They also drive convenience and transparency.

We have two programmes, Start Path and Fintech Express where we invite players to offer them visibility, connect them to our customers, and sometimes invest a small seed funding to keep them going as well.

Additionally, there are PE funds and angel investors that can invest capital, so I think it’s a plethora of players,” adds Malhotra.

GROWTH SPOTS Managing a corporate footprint that runs across the MEA region, Malhotra has overseen the company’s strong presence in Africa to foster its digital landscape, which he considers a potential hotspot for the world. According to a McKinsey report, Nigeria, which is Africa’s largest economy, offers significant opportunities gulfbusiness.com

for fintechs across the consumer spectrum including the SME, affluent and mass-market segments. Nigeria has a population of 200 million, 40 per cent of which is financially excluded.

“We have been heavily invested in Africa for many years. However, our footprint there is very different today than what it was in the past. But I think the Middle East can also be a gateway into Africa because Africa provides a different trajectory of growth for the world,” Malhotra explains.

Beyond traditional finance, Mastercard has also inked partnerships with key non-banking players in the region and beyond for cross-border alliances and growth. Earlier this year, Mastercard and mobile telecoms operator MTN announced a strategic partnership to enable millions of consumers across 16 countries in Africa to make secure global e-commerce payments. “Our partnership with non-financial institutions is very strong. A good example of this is our partnership with MTN, which is the largest telecom provider in the continent. This and our other partnerships with major telcos, fintechs and digital players such as Airtel, JazzCash, Delivery Hero and Uber, enable millions of people to be included into the digital economy. These partnerships ensure reduction of costs, enable digitisation, and advance e-commerce and contactless payments,” explains Malhotra. “Our assets across technology, AI, data and gateways are helping drive growth and we will continue to ramp up.

Overall, it is about enabling hundreds of millions of consumers [to enter the financial ecosystem].”

On a regional level, Malhotra feels that the GCC economies have started the normalisation and growth phase compared to other economies post Covid. However, emerging technologies remain vital to revolutionising local and regional landscapes.

“According to statistics, 5G will account for 10 per cent of the total mobile subscriptions across Middle East and North Africa by 2025. We know it is coming so we are working to enable the whole ecosystem to benefit,” he adds.

THE PEOPLE FOCUS While individuals and companies have and continue to adapt to the Covid-19 pandemic, key takeaways for Malhotra are gulfbusiness.com

potentially broader and more inclusive.

“We already had flexible working hours but as soon as the pandemic happened, we made a global announcement that the company will not do any pandemicrelated layoffs. That was a very bold statement for a firm that didn’t know what the future would look like. But it gave people a sense of comfort knowing that they were taken care of and that we would ride it out together. What we saw in return, was how people responded. What I always felt – and during the pandemic became evidently clear – was maintaining a fine balance between running a business of the short-term versus one of the longterm. And one shouldn’t compromise on either. The decision of not doing any layoffs was a short-term cost issue but carried a long-term benefit.”

Strong on innovation and team building, it doesn’t come as a surprise when Malhotra’s tips to other leaders primarily focus around people and flexibility.

“You cannot achieve without great teams and people who actually work for the same vision. The culture at Mastercard helps drive that common vision.

It’s not just about coming in to work. It’s not a task for us; we actually believe in financial inclusion. In the end, you need to have a culture that allows for people to have a cause beyond work. I also feel that sometimes you should be okay with imperfection. Great innovation is born out of imperfection. More so, don’t underestimate the power of learning constantly because the environment today changes faster than ever in our history.

So having the flexibility to understand what has changed, to adapt, and enable your company to morph into what the environment wants, rather than trying to morph the environment into what you have, is imperative.”

Malhotra’s – and Mastercard’s – plans certainly appear poised to tackle the needs of the future.

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31

BRAND VIEW

Acquiring abundance UAE-based businessman and motivational speaker Dariush Soudi reveals details about his entrepreneurial journey, his new crypto venture and why he remains bullish about the future

Y

ou have had an interesting entrepreneurial journey – what have been the main highlights for you so far?

taking action, being honourable, inevitably the universe will reward all my hard work. Educating oneself and adapting to this fast-changing world is key to continued success and growth

An entrepreneur’s life has often been described as a roller coaster ride. Mine has certainly been no different. When you’re an entrepreneur, you constantly put your head in the guillotine. You can’t hide – if it fails, you’re to blame and if you succeed, you were lucky and you create your luck by working hard. I wouldn’t change any of it apart from the fact that I wish I had listened more to experts in their fields instead of trying to do everything and learn everything from my own experiences – It turned out to be a costly experience – both financially and in time.

Can you describe the various verticals of Be Unique Group? How has it coped with the crisis in the past year?

What have been your biggest challenges and how did you overcome them?

I believe the bigger the challenge we solve, the bigger the wealth and rewards we earn.

For me, moving to a new country [the UAE] in 2009 and having to start my life all over again at the age of 43 with three kids – while recovering from a heart attack – were extremely challenging times.

I always wanted the best in life, and I believe in abundance. During those challenging times, I knew that ‘this too shall pass’. I just knew it was like a passing season, I was going through the winter and spring was next. I had faith that if I just kept challenging myself, learning and

“I always wanted the best in life, and I believe in abundance.

During those challenging times, I knew that ‘this too shall pass’”

Be Unique Group is a diversified company based in Dubai with over 100 staff. The key to our business success is the people in our organisation, and we specialise in recruiting highly motivated people. Our training division through repetition coaching ensures that they adhere to the highest standards. We then help businesses with their creative marketing – that can be anything from logos and branding to strategic marketing plans. Reviewing their client journey and help make them memorable by adding a consistent ‘wow factor’. We also create referral marketing programmes, which ultimately provide the highest returns on investments with the least amount of capital outlay. Our online advertising agency, which my son (Ali) runs, is currently in the top 3 per cent Premier Google partners within the MENA region [for digital marketing].

We are a family business and my wife Angela runs our hospitality company, which develops restaurant plans from start to finish. She has a passion for food – especially healthy food – and this business is doing extremely well. We are currently developing restaurants in Saudi Arabia, Oman and here in the UAE.

One of your newest ventures is a crypto trading exchange. Can you provide us details about it and how it has performed?

There is a huge interest in the cryptocurrency space, with the sector seeing major investment in recent months – especially in tokens such as bitcoin. Blockchain technology is here to stay and we wanted to take advantage of this without the risk associated with the high volatility of cryptocurrency prices.

Hence, we started our own exchange at great cost and opened the world’s first communityowned crypto exchange last year. The results

“What is different about our exchange is that the traders are given tokens (like shares) within our exchange with dividends paid daily.

So, the more they trade, the more money they make” have been amazing. We started trading in September 2020 and have had huge monthon-month growth. In May, our turnover was in excess of $270m and in June, we were trading at $450m. I expect this amount to be our daily average by the end of the year. What is different about our exchange is that the traders are given tokens (like shares) within our exchange with dividends paid daily. So, the more they trade, the more money they make. Our aim is to incentivise and reward our community.

Coming back to Be Unique Group, what are the plans ahead for the organisation?

Any expansion in the pipeline?

Yes, we are looking at expanding our online division and it will soon be operating from the US. Also, with the working patterns and habits changing due to the Covid-19 pandemic, we believe there are huge opportunities to open events spaces where small and medium sized businesses can reach the masses using video conferencing technology such as Zoom, reaching more people at lower costs. We are already in the process of setting up one such event space in Dubai – it will be open before the end of this year.

PHOTO: JOACHIM GUAY

As we start to tide over the Covid-19 crisis, what is your advice to business leaders on what comes next?

Start connecting with your clients again. We are humans and face-to-face relationships remain integral to business continuity. As we head closer into the post pandemic era, let us remember to start reconnecting with people genuinely. Also, an important element is that we must live by our promises.

Looking ahead, which are the sectors

Above: Dariush Soudi, chairman of Be Unique Group

where you see the strongest potential for growth?

Technology has been given a massive push during the pandemic and that’s a trend that’s here to stay. Hence, sectors which will see growth in the future are digital products and

services, financial services and blockchain.

Where is the future headed, in your opinion?

The future is very bright for our children and their children. Never in history has information been so readily available and the transfer of wealth been so easy across borders. With over 8 billion people on the planet, there has never been a larger market of opportunities.

I truly believe and live by the mantra: ‘Think abundance’.

FEATURES / ENERGY

Understanding the

HYDROGEN HYPE

Here’s why the GCC is well-positioned globally to play a leading role in the supply of hydrogen

By Aarti Nagraj

T

he new buzzword in the energy landscape has been decarbonisation, with hydrogen being touted as the fuel of the future. But how far has the GCC actually progressed in the production and deployment of hydrogen? And where is it headed? We speak to Martin O’Neill, VP - Product Management at GE Gas Power and head of GE’s Center for Decarbonisation, to find out more.

Hydrogen has become a hot topic of interest globally and regionally. In the GCC, where do we stand right now in terms of hydrogen production/adoption?

The GCC is starting to look at hydrogen as the primary fuel in a future where only low-carbon fuels will be allowed to burn. With huge reserves of hydrocarbons that have fuelled the world for decades and the increasing global interest in hydrogen for power generation and other uses, we see more and more oil and gas companies in the Gulf focusing on the production of either blue hydrogen or blue ammonia.

This is a means for them to remain relevant in the global energy market in the decades ahead as well. We are still at the beginning but plans have already been announced by Saudi Aramco, ADNOC and NEOM to produce either hydrogen or ammonia, which is a suitable carrier of hydrogen, and to ship this fuel overseas to markets such as Japan, South Asia and potentially other parts of the world as well.

What are the biggest challenges in deploying hydrogen for power generation?

There are many practical challenges in the use of hydrogen as a fuel for power generation: • Transporting and storing hydrogen 34

July 2021

Martin O’Neill, VP - Product Management at GE Gas Power and head of GE’s Center for Decarbonisation

requires special considerations due to its property of attacking and embrittling certain materials and the extreme pressures and temperatures needed to compress and liquefy it.

• Operating a gas turbine on a fuel with hydrogen may require changes to combustion, fuel and plant safety systems.

• Hydrogen has a heating value that is approximately one-third of natural gas. For a given volume of flow, hydrogen delivers less energy. It is also a smaller molecule than natural gas, meaning that it can leak through seals that would be leak-free in a natural gas system.

• Hydrogen is more flammable than natural gas and special considerations are needed for the safe operation of a gas turbine with a natural gas/ hydrogen fuel blend.

• The flame temperature of hydrogen is higher than natural gas. This could result in an increase in NOX emissions depending on the concentration of hydrogen in the fuel and the specific combustion system in the gas turbine.

• There is the issue of traceability and certificates of origin. We need a clear and common understanding of grey, blue, green and other colours of hydrogen and need to know who can provide adequate certification that carbon dioxide formed during the hydrogen production process was stored properly.

Additionally, there are issues that need to be addressed at a systemic level. The more hydrogen you produce, the more renewable energy and carbon capture and storage solutions you need. And the more renewable energy you generate, the more you will need of energy storage, smart grid management systems and integration. This is a very interconnected, integrated world and a lot of work needs to be done to materialise it.

There are several ‘colours’ when it comes to hydrogen – blue, green, grey, turquoise, brown, pink, yellow and white, among others. Can you elaborate on how it all works and which is better?

A colour-based convention is being used internationally to describe and differentiate hydrogen production methods: • Grey (or black): Gasification of coal or reforming of natural gas without carbon capture • Blue: Reforming of steam methane reform (SMR) with carbon capture and storage • Green: Electrolysis of water using renewable power • Pink (Red): Electrolysis of water using nuclear power • Turquoise: Pyrolysis of methane, which produces hydrogen and solid carbon as a by-product • White: Gasification or other process using 100 per cent biomass as a feedstock gulfbusiness.com

FEATURES / ENERGY

In terms of power generation, what is important to note is that the source of the hydrogen doesn’t matter – once the hydrogen is produced, any given volume will burn the same way in a gas turbine to produce the same amount of power, regardless of what means it was produced by. We need to rapidly scale up low carbon hydrogen production – of different colours – if we want hydrogen to be a key part of the energy mix as we work towards deeper decarbonisation.

The UAE has been looking to ramp up production with the aim of exporting hydrogen in the near future. Saudi Arabia also aims to become the world’s ‘largest supplier of hydrogen’. How can GCC states ensure that they meet their ambitious hydrogen agendas?

Globally, more than 90 per cent of the industrial supply of hydrogen comes from a methane reforming process, commonly referred to as SMR. The feedstock for SMR is usually either methane or higher hydrocarbons. Green hydrogen, produced through electrolysis, is more energy intensive than blue hydrogen and requires large quantities of fresh water, which is not readily available in the GCC except through thermal desalination or reverse osmosis (RO) technologies.

To meet their ambitious hydrogen agendas, the GCC states will need to utilise their hydrocarbon reserves to produce blue hydrogen, which typically has production costs less than half those of green hydrogen.

As an international player, how do you see the GCC measure up globally when it comes to the deployment of hydrogen?

gulfbusiness.com

We need to rapidly scale up low carbon hydrogen production if we want hydrogen to be a key part of the energy mix as we work towards deeper decarbonisation

How is GE adapting its portfolio to prepare for hydrogen-fuelled power generation?

Today, all GE gas turbines can burn hydrogen fuel to some degree and we are continuing to develop increased hydrogen capability for our gas turbines through in-house R&D and testing, as well as participating in US Department of Energy hydrogen fuel programmes.

GE gas turbines have been operating with hydrogen fuel blends in a variety of industrial applications, including steel mills, refineries and petrochemical plants – more than 75 of our gas turbines have (or continue to) operate on fuels that contain hydrogen.

We recently announced that a project utilising GE’s 9F.05 gas turbine will power Australia’s first dual-fuel capable natural gas/hydrogen power plant – the Tallawarra B Power Station in New South Wales. The project aims to accelerate the energy transition in Australia using gas that can be further decarbonised by using hydrogen and hydrogen-blended fuels. GE is also enabling the transition of a 485 MW combined-cycle 7HA power plant in Ohio, US to run on carbon-free hydrogen. Long Ridge Energy Terminal, which owns the plant, is collaborating with GE and New Fortress Energy to provide carbon-free power to customers by blending hydrogen in the gas stream and transitioning the plant to be capable of burning 100 per cent green hydrogen over the next decade.

July 2021

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PHOTO: COURTESY OF KIEWIT

Long Ridge Energy Terminal, located in Ohio, US, plans to transition its 485 MW combined-cycle power plant to run on carbon-free hydrogen

The region is well-positioned globally to play a leading role in the supply of blue and green hydrogen and to remain at the heart of the world’s future energy ecosystem, as an exporter of this valuable, clean fuel. This is because the GCC has many of the ingredients needed to produce hydrogen costeffectively in the long run: enormous renewable energy potential; vast amounts of land for renewable energy projects; access to sea water; depleted oil and gas reservoirs to safely store carbon dioxide; and large reserves of natural gas. Additionally, countries in the Middle East can efficiently transport hydrogen to energy-deficient markets in nearby Africa, Europe and Asia.

BRAND VIEW

Educating a generation Ihab Fikry and Ibrahim Kamel, co-founders of Arab e-learning platform Almentor, recently raised $6.5m in a Series B funding round. Here’s what they plan to do next

W

hat is the concept of Almentor and how did the idea for it come about?

Fikry: Almentor.net is an

online video-based continuous learning platform. I had millions of viewers on social media and TV where I used to deliver my knowledge and experience in management to young people. I also lectured in universities and authored several books alongside my full-time job. This inspired and encouraged me to build an online platform that provides knowledge to all Arabs around the world as I witnessed the high demand for Arabic content and the lack of courses available for young Arabs that don’t speak other languages. I eventually decided to resign from ExxonMobil after over 20 years, as did the co-founder of Almentor, Ibrahim Kamel, leaving behind us 7-digit severance packages to devote 100 per cent of our efforts to bring our dream to life.

Give us an overview of the Arab e-learning market size?

Fikry: According to our market research, the addressable market is a population of over 400 million individuals, 60 per cent of whom are between the ages of 18 to 40, across both genders – our target audience. Moreover, about 25 million people are ready as of 2021 to consume continuous content online in the

MENA region with a potential to reach 100 million by 2030 at an average annual spend of $30-40 per learner.

You recently received $6.5m in a Series B funding round. To what end will this new injection of capital be used?

Kamel: Partech led this financing round, with the participation of Sawari Ventures, Egypt Ventures and Sango Capital, thus bringing the total financing that the company has garnered since its inception to $14.5m. The new injection of capital will be used towards upgrading the learning experience and the range of products, as well as to hire and retain additional talent.

Who are some of the high-profile personalities that will offer courses at Almentor?

Fikry: Almentor develops a passion for continuous learning, so learners will never cease to grow and develop. Therefore, a wide variety of subject matter experts contribute to our goal. While 5-10 per cent of these subject experts are celebrities, gurus and opinion leaders, the majority are academic and hands-on mentors in different verticals.

Nevertheless, Almentor has the world’s largest Arabic video-based continuous learning library including over 12,000 videos coming from more than 400 mentors providing videobased courses on a revenue share basis

In the last couple of years, Arabs have positively embraced the drastic change in the landscape of education, particularly e-learning with the platform. Equally important, Almentor develops, produces, hosts, markets and makes the collection for both B2C and B2B regional markets, with mentors sharing their expertise and presenting the courses under Almentor’s guidelines and processes.

Give us a business overview of Almentor.

Kamel: Proudly, Almentor has over one million registered learners along with more than two million learning experiences. A related point to consider, is that Almentor achieved 300 per cent year-on-year average growth since the platform was officially launched in 2018. We are confident about achieving our $10m sales plan in 2021. Our offices are currently located in Dubai, Cairo and Saudi Arabia, besides six studios. Our company has soared from a few employees to more than 170 employees today.

How did being part of a startup accelerator like Sheraa early on help?

Kamel: Almentor was invited to take part in Almentor has the world’s largest Arabic video-based continuous learning library including over 12,000 videos coming from more than 400 mentors

the Sheraa Seed Programme which helped early-stage startups scale their businesses by optimising growth. Sheraa introduced Almentor to the UAE business community.

Although Almentor didn’t receive funds from Sheraa, the PR and networking helped us get further exposure and reach, especially in our early stages. Almentor’s management and team had the opportunity to meet the right business players and entrepreneurs from different emirates and across sectors to share

best practices and tips for success.

How does the Arab e-learning market compare to the West?

Kamel: In the last couple of years, Arabs have positively embraced the drastic change in the landscape of education, particularly e-learning. Not to mention, the pandemic also triggered the interest in online learning which they found convenient to their needs. About 25 million Arab learners are ready as of 2021 to consume continuous content online in the MENA region with a potential of reaching 100 million by 2030. This gives us an indication of the maturity of the Arab learners’ market as well as the growing demand for online learning in the MENA region. Almentor has broken through geographical barriers by providing an online video-based continuous learning platform for Arabs around the world, and is constantly applying best practices to adopt innovative ideas, add greater value to our learning system and provide additional help to online learners as they upgrade their skillset.

Ibrahim Kamel and Ihab Fikry, co-founders of Arab e-learning platform Almentor

Did Covid-19 require you to change the way you traditionally operate?

Fikry: Covid-19 has had a challenging and indefinite impact on the work environment worldwide. Thankfully, despite the confusion, Almentor has successfully reshaped its working environment and established a strong remote work culture with the help of our teams, who were keen to maintain healthy connections and reach our goals.

Moreover, due to the flexibility of the learning methods Almentor provides, it formed a partnership with governments to help develop and deliver tailored training programmes for employees, in addition to creating learning

programmes for school students.

Is online learning set for even further digital disruption?

Fikry: Undoubtedly, e-learning is the future of education and Almentor will continuously meet the growing demand for e-learning which was accelerated by the pandemic.

We’ve entered a new era that is considered a revolution in the world of education, and soon online learning will no longer be optional.

People will not let go of the unlimited advantages including flexibility, where learners can set their own learning pace, in addition to accessibility where they can access content anytime and anywhere, which is much more cost effective.

What are some of the goals in the near- to mid-term?

Fikry: We’ve got major expansion plans including increasing the number of learners to reach 10 million before the end of 2025. We consider this as the first step in leading this space in our region.

FEATURES / GAMING

T

he annual video game convention E3 is normally full of teasers for splashy, graphic-rich games from big-name studios and surprise announcements about new titles.

But this year’s online-only event was much quieter, with many hot releases delayed as a result of the pandemic. That gave games from independent studios a chance to steal the show.

Some of the most impressive reveals this year were small-scale, indie games that may not have the wow factor of something like Ubisoft Entertainment’s Assassin’s Creed but appealed to fans with interesting story lines, quirky graphics or unusual gameplay.

Highlights included Replaced, a gorgeous cyberpunk-themed action game and debut title from Sad Cat Studios, and Twelve Minutes, in which players must break a time loop full of betrayal and murder. The game, from a division of film company Annapurna Pictures, stars Daisy Ridley and Willem Dafoe. Entries like these delighted fans and showcased the breadth of possibilities of video games.

LOW-BUDGET GAMES STEAL THE Most years, E3 takes place in Los Angeles, SPOTLIGHT AT ANNUAL VIDEO GAME where fans and indusCONVENTION E3 AFTER COVID try professionals convene at the convention centre to DELAYS BIG NAMES play demos and watch trailers for the hottest new games.

Commercials and giant posters from expensive series like Call of Duty compete for attendees’ eyeballs, and fans come away excited about what’s coming in the autumn.

This year, while there will be Microsoft’s Halo Infinite, promised in time for the holidays after a year’s delay, Nintendo’s highly anticipated next game in the Zelda series won’t come until next year. Same with Elden Ring, a much-hyped dark fantasy based on the book that inspired Game of Thrones. Fans didn’t seem to mind, and left the show raving instead about Tunic, a Zelda-inspired action-adventure game starring a small fox developed by Canadian creator Andrew Shouldice, and Neko Ghost, Jump, a platforming game from Burgos Games, in which you can shift between 2D and 3D perspectives.

This explosion of independent games, which are usually made by small teams that aren’t funded by multi-billion-dollar corporations like Electronic Arts, or Activision Blizzard, is a relatively recent phenomenon. Until the late 2000s, developers mostly had ILLUSTRATION: GETTY IMAGES/MOLOTOVCOKETAIL

GAMECHANGERS

July 2021

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FEATURES / GAMING

to partner with big publishers to get their games to audiences. The rise of digital distribution on PCs and consoles combined with the increased accessibility of game-making tools such as the Unity Engine have made it easy for solo developers, or two or three people working in a garage, to release successful games on their own. Some companies, such as Annapurna Interactive and Devolver Digital, have thrived as independent publishers, partnering with developers to release exclusively small, creative games.

Since the launch of the Sony’s PlayStation 4 and Microsoft’s Xbox One consoles in 2013, the tech giants have relied on indie publishers to help drive game sales between tent pole releases. Microsoft’s primary focus in recent years has been its Netflixlike subscription service, Xbox Game Pass, which offers access to a few hundred games for a monthly fee. Indie offerings can flesh out this service and allow fans to try out games that they might not have otherwise purchased for $20 or more on their own.

In fact, Microsoft released several dozen demos of

indie games for Xbox players. Its showcase prominently featured indie titles including the role-playing game Eiyuden Chronicles, a spiritual successor to the beloved Suikoden series that raised more than $4.3m on Kickstarter last year. The Redmond, Washington, software giant also announced an Xbox version of Hades, the indie sensation that won several prominent “game of the year” awards last year.

Big video games can tend to look and feel similar in order to reach the widest possible audiences so they can make back their monumental budgets.

But indie games have the flexibility to explore new ideas and as a result, they can be some of the most exciting announcements. Fans know what to expect from EA’s Battlefield 2042 or Ubisoft’s Far Cry 6, but they were surprised by reveals such as Loot River, an indie from Slovakia’s straka.studio, that crosses the action combat of Diablo with the puzzles of Tetris.

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July 2021

PHOTO: VIVIEN KILLILEA/GETTY IMAGES FOR E3

Since the launch of the Sony’s PlayStation 4 and Microsoft’s Xbox One consoles in 2013, the tech giants have relied on indie publishers to help drive game sales between tent pole releases Top: Replaced is the debut title from Sad Cat Studios Above: Convention goers attend E3 2019 at the Los Angeles Convention centre on June 13, 2019 in Los Angeles, California

Independent titles may lack the graphic fidelity present in those big games, but they can be just as striking, as evidenced by the animated game Sable, from Shedworks, which resembles a film from the popular Japanese animation house Studio Ghibli. And independent studios tend to release more non-violent games than the big companies. This year, 33 per cent of the titles announced at the recent game showcases were non-violent, with the vast majority of them from indie studios, according to GamesIndustry.biz.

A list of “most anticipated” games selected by industry media at the end of the event included Twelve Minutes and Songs of Conquest, a newly announced strategy game from Swedish developer Lavapotion. “I’ll mostly remember E3 2021 as a blur of indie games,” wrote Jordan Devore, editor for the video game blog Destructoid.

Bloomberg gulfbusiness.com

BRAND VIEW

Moving in a new direction The mobility industry has been evolving rapidly thanks to technology and changing consumer preferences, says Richard Sikkel, CEO of UAE-based Massar Solutions The UAE’s car leasing business has transformed significantly, thanks to the emergence of new tech disruptors. Can you give us an overview of where it stands at present?

The convergence between mobility and technology has been around for a number of years.

New players get the advantage of a clean slate and tech-focused implementation where larger ones have traditionally been slower to move. We are now seeing that the larger global mobility firms have geared up to implement very advanced technologies for their customers, which is supported by their size, scale, supply chain and distribution capabilities. Unique and compelling value propositions will become the key to unlock value going forward. Technologies, services and concepts that make life easier and more affordable for customers, at scale, is the need for matured markets. The UAE is in a similar position where the combination of technology and mobility services is on the cusp of delivering substantial value to customers. Massar’s Pay Per Kay product, as an example, is one of those products which was one of the first in the region to integrate various technologies to offer a unique value proposition. This product’s technology lifecycle is still in its infancy and one can expect some new exciting features over the next 12 months, specifically designed for improving the customer service proposition.

are – to a large extent – technologically driven. With new enhanced on-board vehicle features, aspects such as connected electric vehicles, autonomous driving and IoT will effectively transform how mobility integrates into daily life. The challenge for mobility organisations is to ensure that they integrate their unique selling propositions into these mega-trends.

At Massar, you offer mobility solutions ranging from fleet management to maintenance. How has the year been so far and what are your plans ahead?

Richard Sikkel, CEO of Massar Solutions

Do consumers now prefer leasing over buying vehicles?

The trend in the UAE is slowly moving to leasing. In some countries in Europe, the penetration of personal leasing is in excess of 40 per cent. The primary reasons that make leasing more attractive include the convenience of getting a brand new vehicle while not having to worry about registration, insurance and inclusive maintenance. The benefits also extend to being able to get a new car in 2-3-year cycles and not having to worry about selling a used vehicle. These benefits and the convenience of leasing continues to grow, and we anticipate the trend to gain pace in the UAE.

With Covid-19, how has the UAE’s leasing and mobility evolved? Are customer preferences changing?

gulfbusiness.com

As remote working has become more and more prevalent, customers are looking for more flexibility in their personal leasing contracts. This is currently aligned to the need for pay-per-use pricing models. Customers want the peace of mind that they have access to a vehicle permanently, but also the flexibility of paying only for what they use.

How much of a role does technology play in the mobility industry?

Technology is an integral part of the entire mobility value chain. All processes related to a mobility business, both internally and externally,

We are in a very unique and fortunate position that our portfolio of services in the mobility vertical are complimentary and in a number of key areas we are considered an essential service.

Over the Covid period, for example, our logistics business delivered groceries to over 5,000 homes per day.

Our passenger transport business transported tens of thousands of people in a safe manner, while we kept our fleet of over 8,000 lease and rental vehicles fully operational. Moving into the latter part of 2021, we are seeing good signs of recovery in the UAE market. There are indicators of growth in various sectors, which is an excellent sign for Massar. Key focus areas in 2021 for us include looking to enter new geographic markets in the GCC along with sizable investment upgrades to various aspects of our technology framework.

Lastly, what are the main trends set to shape the future of leasing and mobility in the region?

It is feasible to expect some form of market consolidation. Enhanced technology offerings will continue to disrupt the market, both by vehicle manufacturers and leasing market players implementing new customer centric technologies. Mobility-as-a-service (MaaS) will continue to grow and industry players will look to adjust their models to offer more flexibility.

June 2020 41

FEATURES / TECHNOLOGY

Calling tech

SUPPORT

The pandemic has brought ICT to the forefront as a critical enabler of business continuity, says Hou Tao, vice president of Huawei Technologies

W

hat has been the effect of the pandemic on technology?

The pandemic has had a dramatic impact on our society. Looking at the role of technology during the pandemic, it’s clear that it marked the great convergence of the digital and physical worlds. One of them is the acceleration of digital processes, whereby years of innovation have been squeezed into one year. We will soon find ourselves in a fully-connected society where digital technology and intelligence are key drivers for socio-economic development.

Also, we have seen the acceleration of intelligent processes. Today, a body temperature detection machine can measure 10 people per second simultaneously, much faster than the manual process. This innovation has proved crucial in mitigating the effects of Covid-19.

There has also been a rapid adoption of production automation. Today, 67 per cent of enterprises have adopted automated production, such as unmanned vehicles within the logistics sector. Additionally, online learning has become the new normal, and we witnessed more than 100 million students receiving their education through online platforms during the pandemic.

These changes placed significant pressure on ICT infrastructure. Global network traffic increased by 50 per cent, and many enterprises have shifted to a cloud-first policy, with up to 85 per cent of enterprises now using cloud services at some level.

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July 2021

Hou Tao, vice president of Huawei Technologies The demand for home broadband has also increased significantly, with an increase of 20 per cent in 2020.

The ICT infrastructure played a crucial role in global efforts to combat the coronavirus and reopen the economy as well.

According to Huawei’s Global Connectivity Index (GCI) 2020, digital transformation of industries will help economies develop “high-order” productivity to spur economic recovery and increase future competitiveness. If we compare countries based on their pre-pandemic GDP per capita forecasts and their revised forecasts after the pandemic hit, it’s clear that the decline is lower in countries with more advanced ICT infrastructure. The pandemic has also brought ICT to the forefront as a critical enabler of

business continuity. The GCI 2020 report revealed that leading global organisations are well aware of the value of digital infrastructure for economic resilience and are continuing to invest in IT despite the overall decline in business investment during the pandemic.

Due to the excellent condition of carrier networks in the Middle East, particularly in the GCC, traffic across the region increased 40 per cent last year due to the pandemic and it has positively impacted many industries. It is clear that ICT is the new engine of economic recovery and development.

How has Huawei supported the ecosystem during the current crisis?

We have worked closely with our customers to ensure the stable operations of more than 1,500 networks across over 170 countries and regions. We also ensured the uninterrupted availability of ICT services that kept businesses and critical public services running.

For instance, in collaboration with our partners, we launched an AI-powered medical platform, which featured AI-assisted CT scan diagnostic systems. We have also enabled telecom operators to quickly roll out 5G networks for hospitals to meet the needs for communications and support remote healthcare services. We have also developed autonomous driving vehicles to deliver medical supplies to communities.

In Saudi Arabia, we installed videoconferencing systems so that different organisations responsible for pandemic response could collaborate easily. This also allowed doctors to share clinical experience while governments could issue guidance more effectively.

What impact do you see 5G having in the region?

Global 5G deployment has proceeded faster than expected. By the end of 2020, the 5G user base had grown three times faster than the 4G user base did.

The Middle East has experienced the first wave of 5G deployment thanks to the joint efforts of governments and operators. We have also promised the UAE and Qatar governments that we will use 5G, AR and VR technologies to help Expo 2020 and next year’s World Cup in Qatar to create unique events. The digital infrastructure of such future cities will be intelligent twins, which will integrate 5G, cloud, IoT, big data, AI and blockchain to build a data-driven and integrated system to serve enterprises and individuals. gulfbusiness.com

ILLUSTRATION: GETTY IMAGES/MALTE MUELLER

S P E C I A L R E P O RT

THE GCC’S ENERGY TRANSITION

SPECIAL REPORT

Powering ahead

BY AARTI NAGRAJ

U

npredictable. It’s a word that has defined the world in the last year and half since the Covid-19 pandemic altered lives and economies across the world. It’s also the word that can be used to explain the movement in energy markets during this time. No one could have predicted – for instance – that we would witness oil hit negative territory and then bounce back up so rapidly.

Or that countries around the globe would now be racing to become the biggest producers of hydrogen.

“Energy markets have reflected the uncertainty and shown exceptional movements. At the beginning of the crisis, plunging fuel demand in many key markets was reflected by prices: by the end of March 2020, the price of gas hit a 30-year low, whereas the price of oil, also affected by supply shocks,

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showed the largest single-day decline in the past 22 years. As economies have reopened, energy commodities have shown a partial rebound: for example, by the end of third quarter 2020, oil demand in China was back at pre-Covid-19 levels, and 50 per cent of the decline was recovered in Europe and North America,” consultancy McKinsey observed in its Global Energy Perspective 2021 report.

According to the International Energy Agency (IEA), global energy demand in 2020 fell by 4 per cent, marking the largest decline since World War II and the biggest-ever absolute drop.

However, based on Q1 data, projections for 2021 indicate that as Covid restrictions are lifted and economies recover, energy demand is expected to rebound by 4.6 per cent, pushing global energy use for this year 0.5 per cent above pre-Covid-19 levels, the IEA said in its Global Energy Review 2021 report.

Almost 70 per cent of the projected increase in global energy demand is in emerging markets and developing economies, where demand is set to rise to 3.4 per cent above 2019 levels. Energy use in advanced economies is expected to be 3 per cent below pre-Covid levels.

“The outlook for 2021 is, however, subject to major uncertainty. It depends on vaccine rollouts, the extent to which the Covid-19-induced lockdowns scarred economies, and the size and effectiveness of stimulus packages. Current economic outlooks assume global GDP will surpass 2019 levels, lifting demand for goods, services and energy. However, transport activity and particularly international travel remain severely supressed. If transport demand returns to pre-Covid levels across 2021, global energy demand will rise even higher, to almost 2 per cent above 2019 levels, an increase broadly in line with the rebound in global economic activity,” the IEA report added.

Regionally, Middle East and North African (MENA) economies started to recover noticeably starting in the first quarter of this year, a trend which is continuing into the second quarter, says Ramy Al-Ashmawy, senior energy specialist at Arab Petroleum Investments Corporation (APICORP).

However, the recovery path for the MENA region will remain “relatively sensitive to fluctuations in oil prices”, according to the MENA Energy investments Outlook 2021-2025 report by APICORP. “For MENA economies, the recovery path will tread between the leading Asia-Pacific region and the trailing hydrocarbon and commodity-dependent emerging markets in Latin America.”

Hydrocarbons Following its steep decline in 2020, oil has rallied nearly 50 per cent this year, with Brent crude touching $75 per barrel in June and the year-to-date average price much higher than the $43 per barrel last year. Even as demand picks up worldwide, and supply released by the Organization of Petroleum Exporting Countries and its allies (OPEC+) remains constrained, the outlook for prices looks promising.

“We expect prices to stabilise in the $60-$70 range. Further increase of oil prices is not supported by supply and demand

ILLUSTRATION: GETTY IMAGES/SMARTBOY10

SPECIAL REPORT

“For hydrocarbon producers, this decade might prove to be the ‘last window’ for the low-cost producers to firmly re-establish their marketshare”

fundamentals, and, if it happens, will impede wider economic recovery,” states Al-Ashmawy.

While the regional oil industry was impacted by the Covid19 outbreak, a year on, the energy industry’s fundamentals are slowly improving as demand for oil products continues to pick up across the globe, which will also allow oil producers to restore supplies, states Saif Humaid Al Falasi, group CEO of ENOC. “While we can anticipate that recovery in demand to preCovid levels will still take time, products such as gasoline and diesel are already witnessing a significant increase in demand, primarily due to the ease in restrictions and the gradual uptick in economic activity. As countries such as the UAE, Saudi Arabia and Qatar continue to implement nation-wide vaccination programmes, demand for oil will continue to increase.

“We have seen an improvement in ENOC’s business activity. On the long term, we will continue to strengthen our operations and competencies, focusing our investments locally,” he adds.

However, there are still some risks to the recovery in the oil market, explains Emma Richards, senior Oil and Gas analyst at Fitch Solutions.

“A lot of debt was taken on during the pandemic and inflationary pressures are rising, which could trigger rate hikes.

Economic activity is generally normalising and unemployment is falling, but new strains of Covid-19 and a low vaccination rate globally threaten renewed outbreaks of the virus and fresh lockdowns,” she says.

“That said, we expect demand to keep rising and the market to tighten over H2 21, supporting further gains in oil prices.

The outlook for 2022-2023 is less certain, as demand growth tapers, OPEC+ (and potentially Iran) return large volumes to market and the US shale sector posts healthy growth.”

Overall, according to APICORP, total energy investments in the MENA region for 2021-2025 are expected to increase slightly over last year’s five-year outlook – from $792bn to

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$805bn. Oil and gas investments are anticipated to witness a healthy uptick in next year’s outlook given the expected improvement in macro conditions, the report added.

“We expect MENA economies to pick up from Q4 2021 into 2022 and over the medium term, with Brent oil price averaging around $65 per barrel in 2021-2022. In natural gas, gains in global LNG prices since Q4 2020 have had a positive effect on both spot MENA LNG exports and the forward-looking pricing of longer term contracts in Qatar and Algeria. Fiscal pressures due to the combined crises of 2020 – and the resulting high debt pile – still weigh heavily on the region’s economies. In the medium term, we are seeing a rationalisation of expenditures in the regional energy expenditures, as evidenced by the yearon-year reduction in the MENA’s five-year investment outlook for oil, gas and petrochemicals,” says Al-Ashmawy.

For hydrocarbon producers, this decade might prove to be the “last window” for the low-cost producers to firmly reestablish their marketshare, particularly Saudi Arabia and Qatar, the APICORP report added.

Renewables Globally, the pandemic has acted as a catalyst in accelerating the energy transition towards cleaner and low carbon energy sources. “Despite the Covid-19 outbreak, global investments in energy transition in 2020 increased by 9 per cent over 2019, and stood at a record level of $500bn, with renewables attracting roughly $300bn of fresh investments,” says Al Falasi.

The GCC – especially countries such as the UAE – have set ambitious agendas to increase the share of renewables in the energy mix. As per the UAE’s 2050 strategy announced in 2017, the country plans to produce 44 per cent of its energy from renewables, 38 per cent from gas, 12 per cent from clean coal and 6 per cent from nuclear by 2050. The UAE, which aims to invest Dhs600bn by 2050 to meet the growing energy demand, also plans to reduce its carbon footprint from power generation by 70 per cent, leading to Dhs700bn in savings.

April also marked a historic milestone for the UAE, when Unit 1 of the Barakah nuclear energy plant started commercial operations following the official start of operations last year. Nawah Energy Company, the operating and maintenance subsidiary of the Emirates Nuclear Energy Corporation (ENEC), commenced operations of the 1400 MW Unit 1, which is now providing constant and sustainable electricity around the clock, with three further units to begin generating in the coming years.

Moving to Saudi Arabia, in March, Crown Prince Mohammed bin Salman announced the mega Saudi Green Initiative programme, as part of which the kingdom plans to reduce its carbon emissions by adopting an energy programme that will generate 50 per cent of the kingdom’s energy requirements from renewables by 2030 by investing in projects in the fields of clean hydrocarbon technologies. Prince Mohammed also revealed the Middle East Green Initiative, which seeks to increase the share of clean energy production across the Middle East over the current 7 per cent by sharing knowledge

ILLUSTRATION: GETTY IMAGES/JAMES ORNDORF

SPECIAL REPORT

“The kingdom has also unveiled plans to power its futuristic NEOM development completely by clean energy”

on advanced technologies. The kingdom has also unveiled plans to power its futuristic NEOM development completely by clean energy.

“The Covid-19 crisis highlighted the cost of tying economies to the fate of fuels prone to price shocks. The energy system, along with the rest of the economy, has been shaken to the core. Amid this, renewables have shown remarkable resilience. Renewable power was a preferred option early on for several reasons, notably its abundance and low operating costs. The crisis was also a test case for renewables-based electricity, debunking myths around the reliability of systems with high shares of solar and wind,” Francesco La Camera, director-general at the International Renewable Energy

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SPECIAL REPORT Agency (IRENA) wrote in the World Energy Transitions Outlook report published earlier this year.

“The energy transition can no longer be limited to mitigation efforts or incremental steps. It has to become a transformational effort, a system overhaul, based on the rapid upscaling of available technologies while innovating for the future. The emerging energy system must promote a more inclusive and equitable world, with resilience against economic and environmental shocks.”

In the region, power utilities have seen the impact of Covid19 on demand growth, consumption patterns, operations disruption and customer dissatisfaction, adds Dr Shihab Elborai, partner with Strategy& Middle East. “It’s highly likely that when governments begin to step in to take action to boost economies in the post Covid era, a large share of stimulus spending on infrastructure will go to utilities. This will increase the trend towards renewable energy.”

Richards from Fitch adds: “The trend [towards renewables] is undoubtedly accelerating. Companies operating in the region are becoming more vocal around emissions and oil and gas companies are increasingly siphoning off investments into alternative energies. While fossil fuels still dominate spending, the share of low-carbon investments will grow over time.

Particular focus will likely be given to investments that leverage existing assets, infrastructure and technical know-how, such as carbon capture, blue hydrogen and blue ammonia.”

Driving the future In the GCC, hydrocarbons have traditionally been the driving force for the economies, contributing extensively to the region’s staggering growth over the last few decades. While factors such as the paucity of resources and the extreme price volatility has pushed the Gulf states to aggressively pursue diversification strategies, their dependence on oil and gas remains significant.

“The energy transition can no longer be limited to mitigation efforts or incremental steps.

It has to become a transformational effort, a system overhaul”

“Hydrocarbons will likely continue to dominate the energy sector for at least the coming decade, and likely longer. Diversification is challenging and in most MENA countries, progress has been fairly limited to date,” says Richards.

“The abundance of fossil fuels, their low cost and wide availability makes them hard to dislodge as incumbents in the energy mix. The region has a lot of potential in the renewables space, in particular solar PV, and investments are picking up pace. Nevertheless, in many markets, obstacles remain, such as restrictive investment climates and the pervasive use of energy subsidies.”

Over the short term, hydrocarbons will continue to dominate the region’s energy sector, agrees Suhail Z Shatila, senior energy specialist at APICORP. “Over the long-term, clean and renewable energy will continue their rise towards a more balanced, sustainable, and diversified energy mix, with hydrocarbons remaining a cornerstone of the region’s economies, albeit in a more conscious manner.”

Looking ahead, the big future trends within the space remain similar to the global ones, including decarbonisation, decentralisation, and digitalisation, according to Strategy&’s Elborai.

“There will remain a need for natural gas as power generation fuel in the foreseeable future, but the share of renewable energy is sure to grow.”

Shatila also concurs that decarbonisation of oil and gas production and a rise in the share of clean energy are among the biggest future trends, along with an increase in energy efficiency and waste recycling, as well as the rising prominence of the region as an export hub for hydrogen – both green and blue – with pilot projects already underway in Saudi Arabia, UAE and Oman.

“The energy transition has become imminent for the regional economies and their national oil companies. Countries like UAE and Saudi Arabia have been pioneers in embracing this energy transition. Masdar in Abu Dhabi and ACWA Power in Saudi Arabia, for instance, have continued to build global portfolios in renewable energy across solar, wind and waste to energy plants. The focus on hydrogen product and synthetic fuels, and the UAE’s plans to set up a ‘hydrogen alliance’ are also emerging trends that we need to be on the lookout for,” explains ENOC’s Al Falasi.

The key aspect to watch out for is the pace and form that the energy transition takes, according to Richards. “The region boasts a large reserve of cost competitive and often low carbon intensity supply and is well-positioned to compete for buyers.

However, the pace at which global oil and gas supply declines relative to demand will ultimately set the price level. This will have major implications for the economic and fiscal health of the region’s producers and the funds they have available to support energy diversification drives,” she adds.

With regional governments embracing the push towards sustainable and viable energy models – by adopting novel technologies, exploring new avenues and partnering with the public and private ecosystem – the outlook for the future certainly looks bright.

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A bright future

BY ZAINAB MANSOOR

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he regional energy landscape has gone through layers of disruption to evolve into its current form. As the demand side of the equation evolved, a departure from the traditional way of powering the world’s energy needs was witnessed through an accelerated uptake of digital interventions and a marked shift towards ‘cleaner’ options. Companies across the industry spectrum adopted indigenous, technology-driven solutions for operational benefits and sustainability.

Painting a green picture Amid larger economic recovery and regenerative strategies, a number of stakeholders are keen to build a future without

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the cloud of climatic cataclysm. Hydrogen is a resourceful fuel and can be used in several ways across the entire energy spectrum, but the traditional way of producing it entails substantial carbon emissions. However, it does draw a crucial link between traditional and sustainable fuels and, in its lowcarbon form, could possibly signal the world’s transition to a sustainable energy future.

Hence clean hydrogen has now secured a major spot within the future’s energy drawing board. While blue hydrogen, in which carbon emissions are captured and stored, is one option, the cleanest alternative is green hydrogen, which is created when renewable energy is used to split water molecules via electrolysis.

“For a sustainable future, we will need a mix of fuels and energy sources, depending on the application and environment, to ensure we can get to net zero quickly and cost effectively,” opines Jonathan Carpenter, vice president of New Energy Services at Petrofac.

“The Gulf has enormous renewable energy resources – particularly solar – that will be increasingly harnessed for domestic power generation and needs. Potentially, green hydrogen, green ammonia and green methanol can also be produced for export. However, this will be constrained by freshwater availability in the region and desalination plant deployments. As a result, the Gulf has the opportunity to remain a major energy exporter for the foreseeable future, while also providing clean, low cost and abundant energy domestically which can be a catalyst for further economic growth and development,” he adds.

Stakeholders across local and regional countries have shown intent to pursue sustainable fuels. In May, UAE firm Bee’ah announced that it will be pursuing the region’s first waste-to-hydrogen project, which includes a green hydrogen generation plant and a hydrogen vehicle fuelling station, in collaboration with UK-based Chinook Sciences. Earlier this year, Mubadala Investment Company, state-owned ADNOC and ADQ formed the Abu Dhabi Hydrogen Alliance to develop a roadmap to accelerate the country’s adoption and use of hydrogen in major sectors. Oman’s OQ too announced recently that, as part of an international consortium, it is developing one of the biggest green fuel projects in the world.

Saudi Arabia also has ambitious plans – it aims to develop the world’s largest green hydrogen project after an agreement was signed between Air Products, ACWA Power and NEOM last year. The $5bn green hydrogen-based ammonia production facility will be located in NEOM and will produce green ammonia for export to global markets.

Meanwhile, an Abu Dhabi Ports’ subsidiary also announced the formation of a green ammonia production facility, in which privately-owned Helios Industry plans to invest over $1bn. The plant will use solar power to electrolyse water and split molecules, and at peak capacity, release 40,000 tonnes of green hydrogen, which will be used to produce 200,000 tonnes of green ammonia.

While green hydrogen does inspire hope, the technology to produce it remains expensive. A study by Strategy&, part of the PwC network, reveals that green hydrogen is currently more

ILLUSTRATION: GETTY IMAGES/SOPHONK

ILLUSTRATION: GETTY IMAGES/FANATIC STUDIO

SPECIAL REPORT expensive than traditional production processes, roughly twice as much as gray hydrogen. However, advances in electrolysis technology, decreasing costs of renewables, and increased economies of scale should significantly reduce its production cost and make it an economically viable solution. Furthermore, GCC countries have several advantages, primarily highyield solar and wind resources, that can generate power at a very low levelised cost of energy. These will allow the GCC region to produce green hydrogen at scale and at low cost.

“We expect that the total demand for green hydrogen could reach about 530 million tons (Mt) by 2050, displacing roughly 10.4 billion barrels of oil equivalent (37 per cent of pre-pandemic global oil production) in various sectors such as heating, transportation, power generation, chemicals, and primary steel manufacturing. This is part of a broader move towards decarbonisation that has sped up thanks to the Covid19 pandemic, which has slashed hydrocarbon demand. At that point, we expect that the yearly global export market for green hydrogen will be worth about $300bn,” the study read.

Transnational alliances have also been formed to pursue low-carbon fuel forms and address climate change. In 2020, Saudi Aramco announced that the world’s first blue ammonia shipment was dispatched from Saudi Arabia to Japan. Ammonia releases zero carbon emissions when burned in thermal power plants and “has the potential to make a significant contribution to an affordable and reliable low-carbon energy future,” according to the energy giant.

Ammonia can also be used across multiple industrial applications. ADNOC revealed recently that it would advance a blue ammonia production facility in Ruwais to meet demands for low-carbon fuels. Blue ammonia is produced from nitrogen and blue hydrogen that is derived from natural gas feedstocks, with carbon emissions captured and stored.

“Ammonia will allow large quantities of the energy captured from renewables, which is converted to hydrogen and then ammonia, to be transported cheaply and can be used to power ships but also replace natural gas or coal in power stations, effectively displacing these fossil fuels in the process. If needed, ammonia can also be converted back to hydrogen at the destination, if that is the preferred fuel source,” adds Carpenter.

Going ahead, in the face of towering climatic and environmental implications, the search for sustainable energy sources continues unabated. The future of biofuels – which are sourced from biomass – also appears promising. “Biofuels represent an important aspect of the roadmap for transport decarbonisation.

To meet our sustainable energy goals, we may also anticipate the need for increasing deployment of many kinds of biofuels.

These include not only ethanol, biodiesel and biogas, but also other types of alcohols, such as methanol or butanol, as well as renewable diesel (HVO) and other so-called drop-in fuels that meet the fossil fuel quality standards” a report by the International Renewable Energy Agency (IRENA) revealed.

However, the primary challenge for biofuels is the ability to produce at scale; presently, biofuels rely on feedstocks that are generally not as widely available in the volumes needed to make an effective substitute for fossil-derived fuels, opines Carpenter.

“The primary challenge for biofuels is the ability to produce at scale; presently, biofuels rely on feedstocks that are generally not as widely available in the volumes needed” “Expanding production will require significant land and water use that are not sustainable. Present biofuels production works best when it is focused on a localised supply chain of feedstock to produce biofuels to meet localised demand, as to limit emissions to enhance its sustainability. Freshwater availability also remains a key challenge for biofuels – particularly in water-stressed regions like here in the Middle East.”

This challenge is also driving innovation, with many technology companies looking to convert more abundant raw materials, or even waste, into biofuels to drive both increased scale and improved economics, he adds.

“One such example is the Green Fuels’ project in Oman with Wakud, where their technology takes used cooking oil via a transesterification process to create biodiesel. Tyres, municipal waste, even sewage and animal slurry, can be converted into fuels, including aviation fuel, which will help to address one of the hardest sectors to decarbonise.”

Advanced biofuels – which make use of non-food and non-feed biomass, including waste materials and energyspecific crops – also offer opportunities to mitigate climate change, harness waste and energy crops, create new jobs, and strengthen energy independence, the IRENA report states.

However, despite the advantages of a transition to producing and using 2G (second generation) biofuels, the emergence of the advanced biofuel industry has been sluggish due to numerous barriers such as high production costs, immature supply chains, dependence on government support schemes that are subject to political influences, and consequent uncertainty around market size, it said.

Digital dive As technological advancements permeate industrial ecosystems, and as companies within the oil and gas sector increasingly integrate their physical systems with digital solutions, businesses can derive timely insights, respond to

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SPECIAL REPORT

real-time queries, foster safety and scale operational efficiencies. Emerging technologies will not only equip companies to adapt to changing market conditions and help achieve their sustainability objectives, but also effectively alter how energy is supplied to the world.

“There is a serious focus in the oil and gas industry to improve on sustainability, efficiency and reduce emissions/environment impact – while maintaining health and safety levels. In this context, we see a focus on digitalisation solutions, seeing as they are a key enabler for critical aspects like predictive/preventive maintenance, workplace hazard reduction, remote operations, enhanced inspection, and operations ability, and overall asset life extension through higher reliability and reduced risk,” opines Abhay Bhargava, senior director, Industrial Practice, Middle East and South Asia at Frost & Sullivan.

Key technologies and solutions being used across the oil and gas landscape include sensors, analytics, drones, cloud/edge computing, AR/VR and digital twins, blockchain, 3D printing/ additives, connected fields, wearables, robotics and 5G. However, the industry is dealing with and prioritising only those

technologies that can support in advancing the automation of activities, which can result in higher efficiency of assets and extension of life, he adds.

Technologies such as a digital twin – which is a virtual representation of assets/processes – is a bridge between physical and digital worlds. Oil giant BP deploys APEX, a simulation and surveillance system that creates a virtual copy of all the company’s production systems throughout the world. APEX delivered 30,000 barrels of additional oil and gas production per day during 2017 across BP’s global portfolio, according to the company’s website.

“The benefits of digital twin technology go beyond simple convenience – providing avenues of real-time monitoring, faster response times, better prediction of potential issues/ deviations to processes, and even the ability to control entire assets/processes remotely,” says Bhargava.

Stakeholder collaborations and key initiatives that address factors impeding the development of sustainable fuels, as well as widespread adoption of digital solutions will underpin the world’s transition to a sustainable global energy system.

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SPECIAL REPORT

The MENA energy outlook

Investments in the power sector continue to surge throughout the region, while investments in gas appear to be plateauing Oil

IN US BILLIONS

0

20

40

60

80

100

Gas

Power

Chemical

120

140

KSA Iraq UAE Iran Egypt Oman Qatar Algeria

GREEN FINANCING

$10.38bn

Kuwait Morocco

OIL DROP

-9%

The total value of green bonds issued in the MENA region since 2016

The year-on-year drop in oil demand, to reach 92.2 million bpd in 2020

Jordan

-34%

Bahrain

$805bn

Libya Tunisia

$3.3bn

Total 2021-25 MENA energy investments

Lebanon

MENA COMMITTED PROJECTS

BY SECTOR (2021-25)

MENA PLANNED PROJECTS

BY SECTOR (2021-25)

Oil 42%

Oil 20%

Gas 27%

Green bonds issued in 2020 – a record

The year-on-year drop in oil and gas investments (including exploration and development)

Demand by fuel Due to weak and uneven recovery in road and aviation fuels, refining margins will remain fragile Pre-Covid19

100

Actual

80 60

Nuclear

0

Hydro

Power 31%

Gas

20 Chemical 22%

Renewables

Power 30%

40

TOTAL

Coal

TOTAL

$497bn

Gas 24%

Oil

Chemical 4%

$308bn

SOURCE: APICORP’S MENA ENERGY INVESTMENT OUTLOOK 2021-2025

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“WE CAN'T SAVE THE WORLD BY PLAYING BY THE RULES, BECAUSE THE RULES HAVE TO BE CHANGED. EVERYTHING NEEDS TO CHANGE, AND IT HAS TO START TODAY”

C L I M AT E C H A N G E A C T I V I S T G R E TA T H U N B E R G

JUL

Lifestyle

21

Trailblazers

Watchmaker Girard-Perregaux and carmaker Aston Martin have embarked on a long-term partnership, and are making the rules as they go along – evident through this latest timepiece p.64

“Last year, the luxury division did around $650m worth of sales” - Josh Pullan, managing director of the Global Luxury Division at Sotheby’s

gulfbusiness.com

Naim Solstice Special Edition Limited to 500 units, the very first turntable from the British hi-fi manufacturer comes with a special-edition Naim-produced record as well July 2021

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Lifestyle / Luxury

Bidding on the future Josh Pullan, managing director of the Global Luxury Division at Sotheby’s, is taking a centuries-old auction house down a path that is fundamentally altering the way it does business

BY VARUN GODINHO

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hen a 277-year-old-auction house decides that it wants to be something more, revealing an existentially different model, several questions are thrown into a vortex, especially: ‘What’, ‘How’ and ‘Why now’. Josh Pullan, managing director of the Global Luxury Division at Sotheby’s, has the answers. In December, the American auction house introduced an online platform called Buy Now, that sidesteps its typical bidding process, and instead offers items for instant purchase.

“We offer over 5,000 items that are available for instant purchase. The reason that we wanted to create this platform was to meet the needs of our clients 24x7, as opposed to episodic auctions which is an event-based business,” says Pullan. The platform, which went live in the US at the end of last year, began shipping to 75 countries in the first quarter of 2021.

But at an auction house that can command hundreds of millions of dollars in a year through its tried-and-tested model, introducing a polar opposite business such as Buy Now requires strong justification. As Pullan explains, 70 per cent of the buyers on the platform are new clients to Sotheby’s, allowing its digital net – Pullan was previously the head of e-commerce for Sotheby’s – to play a dual role of attracting new revenue and fresh audiences.

Notably, to compete in the online space, Sotheby’s isn’t dropping its prices.

“Our average item is around $10,000 on the platform. I spent 10 years building and developing our digital business out of New York. We’ve seen a 600 per cent increase

in our online sales by value in the luxury [division] last year.”

That luxury division at Sotheby’s was created in September 2020 and incorporates jewellery, watches, wine and spirits, 20th-century design, handbags and accessories, sneakers, books and manuscripts, as well as autos. “Last year, the luxury division did around $650m worth of sales.

The biggest category in the entire division was the jewellery business – we had sales in excess of $310m. And our watches business was the second largest, [followed by] wine, design and books. But jewellery takes up the lion’s share of the revenue.”

Thirty-five per cent of the buyers within this jewellery category were new to Sotheby’s, an increase of 32 per cent from the year prior. It would come as little surprise that 90 per cent of the jewellery lots sold in 2020 went to online buys, double that of the previous year. The Cartier Tutti Frutti bracelet sold for over $1.3m in May last year, becoming the most expensive jewellery piece ever sold in an online auction at the time, but was followed by other star pieces including a 102.39-carat D Colour Flawless Oval Diamond that sold for $15.7m in Hong Kong in October and a 14.83-carat Fancy Vivid Purple-Pink Internally Flawless diamond that went for $26.6m in Geneva the following month. Digital adoption played a

pivotal role in Sotheby’s jewellery business last year, with over 47 online sales realising $69.2m – double the number of sales and almost eight times the value for 2019. The highest bid placed on its app was $3.8m for a 12.38-carat pear-shaped pink diamond ring.

Apart from jewellery, watches were the next biggest performer for the luxury division. Global auction sales of watches at Sotheby’s reached $97.5m in 2020. Over 140 online sales netted $47.4m year-to-date – almost eight times the number of sales and five times the value over 2019’s watch sales.

Covid-19 notwithstanding, demand for preowned luxury watches remained robust. In 2020, Sotheby’s first online sales ever dedicated to pocket watches gathered $9.1m. But one of the year’s biggest horological offerings in the auction world was the Rolex Cosmograph Daytona Ref 16516, which sold in July for $3.3m.

Jewellery and watches aside though, the category that created the biggest buzz, at Sotheby’s and beyond, was the newly introduced sneakers and streetwear offering. It’s an experimental and edgy route for an auction house that’s built a reputation for itself over the likes of a $558,000 1945 RomaneeConti French Burgundy or a $104.1m Pablo Picasso Garçon à la pipe or even a $3.9m Kashmir sapphire to then introduce Notorious B.I.G’s jewel plastic crown and Kanye West’s sneakers into its auction portfolio. In September last year, Sotheby’s held its firstever hip hop themed auction in New York and raised $2m from the sale, around 20 per cent higher than Sotheby’s itself estimated.

While the auction house will intermittently focus on streetwear and pop culture, Pullan’s team cannot underestimate the importance of sneakers. “The sneaker business has really exploded, and the resale market is at an all-time high. In 2019, the resale market was about $6bn globally.

It’s estimated that it could reach about $30bn by 2030. What I think is driving this category is that it resembles many other traditional collecting categories like jewellery, watches or fine art, because ultimately, sneakers have an element of design, craftsmanship and quality. At Sotheby’s, we offer two types of sneakers, the game-worn sneakers worn by some of the NBA’s greatest players, and then there are the models which people are chasing because they’re red

“In 2019, the [sneaker] resale market was about $6bn globally.

It’s estimated that it could reach about $30bn by 2030”

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gulfbusiness.com

Lifestyle / Luxury

Left from top: Last year, the luxury division did around $650m worth of sales; Sotheby’s auctioned Kanye West’s Nike Air Yeezy 1 Prototypes for $1.8m

hot.” An example of the latter category, and one that pushed the conversation around the potential for sneakers as true mainstream collectables, was when Sotheby’s auctioned Kanye West’s Nike Air Yeezy 1 Prototypes for a staggering $1.8m – making it the most expensive pair of sneakers ever publicly sold, and the first to command over a million dollars in a public sale. “Oftentimes, they’re anchored in a particular moment in time, so like the Kanye Yeezys that we sold in Hong Kong for $1.8m is super important because of its provenance stemming from the fact that he wore them at the 50th anniversary Grammys. It was the pair of sneakers that launched the Yeezy brand.

These are the grail objects that people chase, because they have that great story and they have the perfect provenance behind them,” explains Pullan as to why the Kanye kicks securing the million-plus price wasn’t just down to hype.

While Sotheby’s online platforms have increased participation from clients in several countries around the world, one of the regions that is still of primary importance is the Middle East. “There’s an increased focus on pre-owned luxury in the Middle East.

And when we look at the number of participants from the region in luxury, we’ve seen an increase of approximately 30 per cent between 2018 and 2020. As recently as 2019, we appointed our leading watch specialist, Frédéric Watrelot, and also a jewellery specialist, Sophie Stevens, to look after the region and both of them are in Dubai.”

While the Middle East has potential, the market that is already on top for Sotheby’s is Asia. Around 50 per cent of the clients last year in its jewellery category were from that region. “For luxury, Asia is an absolutely critical market. We’ve seen great growth there in the last 12 months. Our big presence in the region is in Hong Kong. We have a WeChat programme in China, and it’s a great way of reaching an audience, with live content in the local language, [and connect] also culturally.” gulfbusiness.com

July 2021

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Lifestyle / Luxury

Right: Sotheby’s opened The Emporium in its NY headquarters, a space considered a physical extension of the Buy Now platform Bottom: Josh Pullan, managing director of the Global Luxury Division at Sotheby’s

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hat Sotheby’s has excelled in over the last couple of auction seasons, and what Pullan has pushed more determinedly since he took over the luxury division, is brand collaborations. It has previously collaborated with the likes of Hublot, IWC and Vacheron Constantin, but more recently with Chopard. Earlier this year, Chopard’s co-president and artistic director, Caroline Scheufele, presented the latest addition to her Precious Lace collection – a Paraiba Tourmaline Necklace – as a piece that is exclusively available via a private sale at Sotheby’s.

Another example of Sotheby’s strategically partnering with brands was ahead of its Geneva Luxury Week sale in April, where it collaborated with Swiss major watch and jewellery retailer Bucherer both on the physical display of its merchandise ahead of the auction, and also on product categories. “We had displayed some of the property from our auction in their flagship stores in [Geneva’s] Rue Du Rhone. They also offered a number of their watches as part of that Geneva Watch Auction that came from their certified preowned programme, which is a guarantee that the watch is not just authentic, but that it’s been serviced, that it comes with a twoyear service warranty and that the parts are from an authorised dealer.”

Having a physical space for its auction items to be present is as much a priority focus for Pullan as diversifying and expanding its product inventory. To that end, Sotheby’s opened what it called The Emporium in the lobby of its New York City headquarters in May, which is considered a physical

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extension of the Buy Now platform and offers its collection for outright purchase.

“The Emporium is focused on how do we capture the traffic that’s coming into our New York headquarters, and help make them aware of our Buy Now business and the marketplace. This is a window into our digital marketplace, using our physical footprint to bring people into it. It is our first omnichannel retail store,” explains Pullan.

The Emporium invites one leading guest

“For luxury, Asia is an absolutely critical market.

We’ve seen great growth there in the last 12 months”

curator to determine which items from its Buy Now marketplace are on display in the venue. Over May and June, it invited Gucci Westman to curate her selection of items which included a $95,000 David Webb gold, platinum and diamond necklace, a $30,000 stainless steel Rolex Submariner, and even a Porsche 356 as its centrepiece. Apart from The Emporium, Sotheby’s other global physical display spaces include the East Hampton gallery, another one in Palm Beach and also a London New Bond Street gallery that is dedicated to direct purchases.

While Buy Now has opened up a new business model for Sotheby’s, its traditional bidding practice doesn’t seem to be cannibalised in the process. In fact, at Sotheby’s Geneva Luxury Week auction in May, a series of six sales dedicated to jewellery, watches, handbags and sneakers notched up $70.2m, 14 per cent over the last auction season. Interestingly, 30 per cent of the bidders were new to Sotheby’s and more importantly, 50 per cent of the bidders overall were under the age of 40 (also, 85 per cent of bidders in the sneaker sale in Geneva were under 40). “Half of the bidders we had overall were under the age of 40, but yet the average item value was $200,000. We are focused not only on cross-category sales, but how do we make Sotheby’s more relevant and approachable for new audiences.

We’re focused on that affluent, younger generation, using digital tools to engage the broadest possible audience.”

The ‘What’, ‘How’ and ‘Why Now’ of Sotheby’s new strategy for its luxury business is clear. It leaves Pullan in a commanding position to determine: ‘What next’. gulfbusiness.com

Lifestyle / Travel

Healthy outlook A delegation of medical operators from Switzerland recently visited the UAE to explore opportunities to grow the Swiss medical tourism sector

BY VARUN GODINHO

S

witzerland’s robust healthcare system is among the best in the world. According to a 2018 Euro Health Consumer Index (EHCI) ranking which surveyed 35 European countries, the Alpine nation came out on top with 893 out of a total of 1,000 points.

While it has been a boon to domestic patients (Switzerland reportedly spends around 12 per cent of its GDP on healthcare), it is also in the enviable position of offering its top-notch services to international patients. As Mark Wettstein, director of health tourism at Switzerland Tourism says, there are around 35,000 annual inpatients at Swiss hospitals with residency outside Switzerland. These foreign patients represent around 2 per cent of total patients at Swiss hospitals.

The main source countries for these foreign patients, according to Wettstein, are the GCC region, Russia (including the former Commonwealth of Independent States) and EU countries.

Mindful of the significance of the GCC countries, a delegation of five clinics and private hospitals – Hirslanden Private Hospital Group, Rehaklinik Zihlschlacht, Oberwaid Klinik, Waldhotel Health & Medical Excellence and Clinique La Prairie – visited the UAE last month to meet with various stakeholders including government entities, health personnel and medical facilitators to explore opportunities to drive Switzerland’s medical tourism sector.

“The quality of the medical infrastructure and offering in Switzerland is unrivalled. This visit will boost bilateral ties between the medical experts in both countries and make our offers known to an even broader public,” said Massimo Baggi, the Swiss ambassador to the UAE. Switzerland Tourism has partnered with around 30 hospitals and clinics to develop the messaging around health tourism in Switzerland, and to jointly coordinate gulfbusiness.com

efforts to showcase the country’s quality of healthcare and its ancillary infrastructure.

Several factors have contributed to positioning Switzerland as the go-to destination for medical tourism. Chief among these is what EHCI says are short waiting times for elective surgeries, cancer treatments and even CT scans. As Wettstein adds, the main treatments solicited by foreign patients are in the oncology, cardiology, orthopaedics and rehabilitation categories. The primary hubs for these patients remain the regions of Geneva and Zurich. While some facilities like the Waldhotel Health & Medical Excellence (which was part of the UAE delegation) offer several specialists under one roof, other dedicated centres including the likes of Mentalva Private Clinic focus on mental health and complementary medicine.

Another contributing factor to the success of the Swiss healthcare sector, is that the facilities are backed by the latest tech – according to a 2019 study by the OECD which surveyed 37 member countries, Switzerland reportedly has the second-highest number of MRI machines behind Japan. Also, hybrid operating theatres or the use of the da Vinci

robotic surgical system are not uncommon within the country’s medical infrastructure.

One of the most important reasons that foreign patients prefer to get treated in Switzerland is because of the high degree of privacy afforded to patients and their families, and the assurance that treating medical facilities will hold sensitive patient information securely and confidentially, giving high-profile patients the ability to escape public or media scrutiny in their home countries during their recovery.

According to Wettstein, the approximate duration of stay of international patients in Switzerland is seven nights, and each patient on average is accompanied by 2.5 people. Realising this, most major hospitals in Switzerland have a dedicated office to organise accommodation and activities for relatives accompanying patients on their visits to Switzerland.

A shot in the arm for Switzerland’s tourism industry overall was the decision by the Swiss authorities recently to waive quarantine requirements for vaccinated visitors.

Therefore, vaccinated UAE residents and Emiratis, or those who have recovered from the virus, are allowed to enter Switzerland without having to quarantine. The exemptions work the other way around too.

Switzerland is also on Abu Dhabi’s green list for travel, which means returning visitors from there do not have to quarantine on arrival in the UAE capital.

With policies and infrastructure in place, it is inevitable that the GCC in general, and the UAE specifically, will continue to be a growing source market for the Swiss medical tourism sector.

Foreigners account for around 2 per cent of all the patients at Swiss hospitals

July 2021

63

Lifestyle / Horology

In the driver’s seat A centuries-old Swiss watchmaker and a thoroughly British luxury carmaker recently joined forces, announcing the first timepiece as a result of that partnership

BY VARUN GODINHO

O

nly a few months ago, storied British carmaker Aston Martin was in dire straits. The company had gone public in 2018, but by early 2020, it was in deep trouble with sluggish sales, massive expenditures, and faltering product strategies. Surely, the pandemic would be the last nail in its coffin.

That was until Canadian billionaire Lawrence Stroll rallied a band of investors and wrestled control of Aston Martin.

It’s been a stellar comeback since, with Aston Martin reporting that its revenue in Q1 2021 rose 153 per cent to GBP244.4m on the back of the runaway success of its DBX SUV which accounted for 55 per cent of the total number of vehicles sold in the first three months of this year. Stroll is raring for much more – by 2025, he wants the brand to make revenues of GBP2bn.

A major decision he took, apart from announcing a strategic partnership with Mercedes, was to return Aston Martin to the pinnacle of motorsport – Formula 1 – this year. The significance of the move is not lost on Marek Reichman, executive vice president and chief creative officer at Aston Martin Lagonda. “Aston Martin has just come back to Formula One after 61 years, and I think that gives you an idea of the future of the brand,” said Reichman, during a recent press meet to discuss the brand’s latest partnership with Swiss watchmaker Girard-Perregaux.

In February, Aston Martin announced that it would enter into a long-term (neither would confirm how long) partnership with Girard-Perregaux. Swiss watch brands partnering with major carmakers and motorsport events is not uncommon – Richard Mille recently joined forces with Ferrari, IWC has a long-standing relationship with Mercedes, and Rolex signed up as title sponsor of Formula 1 in 2013.

Reichman insists that the Girard-Perregaux x Aston Martin deal is not based 64

July 2021

The teams developed a leather strap with a rubber insert injected with white gold

merely on superficial optics, but ties into the carmaker’s raison d’ètre which is anchored in exclusivity and craftsmanship.

Over a joint call with Girard-Perregaux CEO Patrick Pruniaux, Reichman said, “In 108 years, we’ve made 100,000 cars. Ninety-five per cent of all the cars we’ve made still exist.

An Aston Martin isn’t something that you buy to relinquish ownership. It’s about the desirability of our products. Whether it’s timepieces or our cars, these are collectable

“In 108 years, we’ve made 100,000 cars. Ninety-five per cent of all the cars we’ve made still exist”

pieces that people will, in some instances, keep for their lifetimes and hand down.”

Pruniaux, who in addition to Girard-Perregaux also heads up Ulysse Nardin, said that the decision for the Kering-owned watchmaker to partner with the Gaydonheadquartered auto major wasn’t a force fit. “Girard-Perregaux is one of the oldest watchmakers in Switzerland. I don’t know if 95 per cent of the watches we’ve produced are being used, but there’s a good chance they could still be used,” noted Pruniaux.

It’s one of those historical timepieces that Pruniaux is referring to, specifically Tourbillon with Three Gold Bridges from 1867, that has in fact been the inspiration for an all-new timepiece that was introduced to mark the new partnership.

The Tourbillon with Three Flying Bridges – Aston Martin Edition is a 44mm timepiece with a DLC-treated case made from Grade 5 Titanium (interestingly, titanium ore was discovered in Great Britain in 1791, the same year that Girard-Perregaux was formed) and with gold indexes. As Pruniaux explained, there is no mainplate, but it is the three bridges on the movement construction that have replaced the main plate. “The Three Bridges is an icon for Girard-Perregaux, just like the DBS is for Aston Martin. We jointly worked with Mark and his team on designing this tourbillon with three flying bridges. Rarely do we work with others to reinterpret the Three Bridges. However, on this occasion, we made an exception, mindful of Aston Martin’s design prowess,” added Pruniaux.

In a mechanical feat of engineering, that in many ways requires the same levels of precision and allows for the same margin of error that you’d find on an F1 car, the tourbillon cage on the watch measures just 10mm and is composed of 79 components, collectively weighing only 0.25grams, with a blue hand to denote the running seconds of this automatic winding timepiece.

Aston Martin’s name is engraved on the vertical flank of the white gold micro-rotor which can be found beneath the barrel at 12 o’clock. The rotor has been patented because, unlike those found in other timepieces, it is constructed around the barrel so that it does not obstruct the view of the mechanics of the skeletonised timepiece.

But in a move that demonstrated a nextlevel technological collaboration between the Swiss and British, you’d have to look beyond the mechanics and to the material gulfbusiness.com

Lifestyle / Horology

18

The number of pieces the watch is limited to From left: Marek Reichman, executive vice president and chief creative officer at Aston Martin Lagonda; Patrick Pruniaux, CEO Girard-Perregaux

front instead. Teams from both companies worked together to develop the first of its kind Girard-Perregaux Rubber alloy which consists of a leather strap with a rubber insert injected with white gold. “We have developed an alloy, a mixture of rubber and a precious metal, to create something which gulfbusiness.com

has precious content. We’ve worked with local artisans to create the material locally.

[It] is a crossover of both brands – it has the materiality, softness and suppleness of an Aston Martin, and the precious metal [element] that you would typically expect from a timepiece. It’s highlighted by a typical stitch that you will find on the inside of a DBS.” The GP09400-1683 movement returns a 60-hour power reserve and operates at a standard frequency of 21,600vph. An antireflective crystal allows you to peer closer at the movement, with the luminescent and skeletonised Dauphine hands allowing as much of an unobstructed view of the movement as possible.

The timepiece is limited to just 18 pieces and priced at CHF130,000. “Some may not be able to afford an Aston Martin, but will dream of it – and the same [goes] with a Girard-Perregaux,” observed Pruniaux. For a typical Aston Martin customer though,

who would pay north of CHF200,000 for a DBX on any Sunday morning, the price of this Girard-Perregaux is hardly a deterrent.

But, as is the case with most luxury items – not least an Aston Martin or a fine Swiss mechanical watch – with only 18 pieces to go around, when they’re gone, they stay gone.

July 2021

65

A swing and a win The Emirates Amateur Golf League Mini-Series held last month proved the operational feasibility of the much-anticipated world’s first franchise-based amateur golf league that will be held later this year

T

here are big plans in store for November’s inaugural season of the Emirates Amateur Golf League (EAGL) – the world’s first franchisebased amateur golf league. A brainchild of Indian businessman Sudesh Aggarwal, the concept has slowly begun to take shape.

Earlier this year, EAGL brought in Indian professional golfer Shiv Kapur as brand ambassador, and also appointed Nick Tarratt as Tournament director.

But with an experimental tournament like this one, Aggarwal and EAGL League administrator, Priyaa Kumria, thought it necessary to have a dress rehearsal to test the format and operational flow, as well as the sheer logistics of hosting such a tournament.

66 June 2020

To that end, a 9-hole showcase event, called EAGL Mini-Series, was held on June 20 at the Fire Course of the Jumeirah Golf Estates.

The one-day event gave eight four-man teams – namely the Abu Dhabi Roars, Dubai Tigers, English Roses, MENA Golfers, Indian Lions, Emirates Players, Asian Jumbos and European Seves – a chance to compete against one another.

Asian Tour winner Kapur was on hand to hit the ceremonial first tee shot. “I have never seen an amateur golf [event] like this, not even professional golf across the world. The idea is that team golf is always more exciting than individual formats; the colourfulness, the uniforms, you are playing for a team, it’s

a nine-hole shootout…it’s very exciting and I think it’s here to stay,” said Kapur of the EAGL format.

The MENA Golfers went up against the Asian Jumbos, captained by Dubai Eye’s Robbie Greenfield, and they got off to a strong start in Match 2 with Deepak Jain beating Bayern Khan 3&1.

All matches featured an additional ‘press match’ where the remaining holes were played out if the match finished before the 18th, with an additional point up for grabs for the winner. The pair halved their press match, meaning it was two points on the board.

In Match 7, MENA Golfers’ Ashok Kumar beat Rohit Kashal 3&1 and then won the press match 1-up to contribute a sensational three

gulfbusiness.com

BRAND VIEW

Right: Sudesh Aggarwal, owner of Emirates Amateur Golf League Opposite page: MENA Golfers won the Mini-Series held on June 20 in Dubai

points, while in Match 9 Zubair Firdaus replicated the feat by beating Wayne Platts 4&3 before adding another point with a 2&1 victory in the press. The emphatic team display was rounded off in Match 13 where Craig Vance won his match against Paul Murnaghan 3&2 before halving the press match. By collecting 10 points out of 12, MENA Golfers won the Mini-Series.

One of the highlights of the event was that there were TV cameras on hand, along with commentary from Graham Clews, with the footage broadcast live on Dubai Sports channel and EAGL’s social media handles.

“The live telecast was always going to be a very crucial part for us. In the end, it was good to hear the feedback from the players about it. Most of them talked about the pressure that comes with the cameras around them, and how it affected their games. The sheer joy on their faces as they showed us messages from their relatives and friends who were watching the action in far-flung places such as the US, South Africa, Australia and Mauritius, was something that we will cherish,” said league administrator Kumria.

It’s a sentiment shared by Kapur, who added, “I was feeling some butterflies on the first tee, so I can imagine what the amateurs were going through; to be live on TV and the nerves that they feel, it’s very different from Pro-Am. The whole idea of EAGL was to give them the experience of pro tournaments for team competitions, so it’s like the Ryder Cup and a Tour event all in one.”

MENA Golfers team-member Vance, playing off a -4.5 handicap, also singled out the

benefits of a live audience which were present on the course. “We had music on the first tee which livened it up a bit, [with] plenty of spectators. I think the event will hopefully give the juniors a little bit more exposure to what it’s like in these bigger events as you move out of Dubai.”

Judging by the buzz that the event created among the local golfing community and the social media traction it gathered, Aggarwal was “absolutely delighted” with the day. And understandably so, given the planning and execution of the Mini-Series, including a State of the Nation-style forum headlined by industry heavyweights after play, was achieved in less than 45 days.

The EAGL-organised Middle East Golf Forum, which took place on the same day as the Mini-Series on June 20, saw industry

“The whole idea of EAGL was to give them the experience of pro tournaments for team competitions, so it’s like the Ryder Cup and a Tour event all in one” gulfbusiness.com

heavyweights including Chris May, CEO of Dubai Golf; Mark Chapleski, president of Troon International; Simon Corkill, executive Tournament director, Omega Dubai Desert Classic; Ismail Sharif, managing director of Jumeirah Golf Estates; Roger Duthie, sponsorship officer, Performance 54 and Tarratt debate on the topic ‘The Health of the Game of Golf in the UAE and the Middle East in 2021’. “Although there were challenges last year, I think that golf in the region is in a very positive place. We have seen the number of golf rounds increase by 20 per cent since the Covid-19 lockdown of 35 days between March and April. That’s a real positive because we have seen an increase in the number of memberships, rounds by members and nonmembers and the number of lessons being taken. So, there is definitely an increase in the interest in golf in the region and we have great opportunities to capitalise on that going forward [to] really grow the game,” said May. Meanwhile, Aggarwal confirmed that there will be similar events in the run-up to the main tournament in November. “We are pleased to announce two more Mini-Series as part of the Amateur Golf Tour by Just Golf before the end of 2021. Dates, venue and other details will be revealed soon.” Stay tuned.

June 2020 67

Lifestyle / Entertainment

The big stage Abu Dhabi’s live events industry has shown resilience.

John Lickrish, CEO of Flash Entertainment, now wants to replicate the model elsewhere

BY VARUN GODINHO

O

n June 9, 2020, weeks after the global live events industry went headfirst into a concrete wall, UFC president Dana White dropped a bombshell. While every other major sporting event – not least the Olympics itself – was either rescheduled or even cancelled, White confirmed that by the following month, UFC would take its first-ever Fight Island Concept to Yas Island in Abu Dhabi.

Organised by the Department of Culture and Tourism – Abu Dhabi (DCT Abu Dhabi), event organisers Flash Entertainment were brought on as the operations and logistics partner to deliver the entire event.

What followed was an elaborate setup that included an 11-square-kilometre stretch of Yas Island that was created as a safe zone and sealed off from the public to create a bubble wherein only those directly involved with the event were permitted.

All 1,678 Abu Dhabi-based events staff involved were subjected to a 14-day hotel quarantine. Repeated Covid-19 tests were

departure,” says John Lickrish, CEO of Flash Entertainment. Flash had held a 10 per cent stake in UFC which it sold in 2018 for an undisclosed amount.

While Flash, which was set up in 2008, would have in routine times busied itself with pure logistics, to pay additional heed to newfangled and intricate healthcare protocols

Lickrish defines Flash as a 360-eventsservice company with a staff of around 50 full-time personnel, ramped up to around 100 seasonally during the year to cope with managing added events. Across a matter of weeks, it could find itself dealing with UAE National Day celebrations, a Formula 1 after-party concert, an AFC Asian Cup football tournament and the Pope’s visit.

“We’re a full-service events company where we create IPs and also operate them, or we use existing IPs from other third parties or government entities. We also have a facility management side where we operate venues throughout Abu Dhabi,” says Lickrish.

By focusing on facility management as well, Flash has nurtured an infrastructure and ecosystem around the events industry.

One of those mega venues is Etihad Park.

With a capacity of 40,000, the venue has reportedly hosted over 1.5 million people since it was built back in 2009 and has been the location for Flash Entertainmentmanaged Yasalam After-Race Concerts that brings in A-level acts from around the world, including Rihanna, Coldplay, The Rolling Stones and Lana Del Ray to perform during the annual Abu Dhabi Formula 1 Grand Prix weekend.

“When I first came to Abu Dhabi, there was only the core of Ferrari World sitting on Yas Island, with pre-work underway on the Formula 1 track. We saw the drawings at that stage and found that there was nothing occupying that particular area outside Ferrari World. We built and paid for what is now Etihad Park, and that came

“I don’t think the new normal is going to be socially-distanced events. We [need] to have people be socially responsible instead” conducted on the staff, and in the run-up to the event, over 10,000 tests were administered within the safe zone. “It was a huge undertaking never been done anywhere in the world. We had three different major zones within five levels of quarantine at Yas Island. It was the first time for everyone and we were relying on protocols to establish these safety zones. We had one positive case detected, and that too even before they entered the country at the airport of their 68

July 2021

only meant added pressure. For Abu Dhabi, there was more at stake. “A lot of credit must go to the tourism authority for taking that kind of leap of faith. It’s something that could be a huge risk to the reputation of the city,” adds Lickrish. It proved to be the contrary. With multiple events including UFC 253 and UFC 254 subsequently held in the emirate last year, it led to the big Dustin Poirier vs Conor McGregor UFC 257 held at the Etihad Arena earlier this year.

from Flash’s own cash reserves and the money we’ve made over the years. We’ve been maintaining and operating that venue since then.”

Apart from Yasalam, a high-profile event that was started and is owned by Flash Entertainment is the Mubadala World Tennis Championship with the likes of Serena Williams, Rafael Nadal, Novak Djokovic and other star players regularly competing on the court. gulfbusiness.com

Lifestyle / Entertainment

1.5m

people hosted at Etihad Park since it was built in 2009

Even though events like the UFC and others took place recently, the Covid-19 pandemic has had a significant impact on Flash, as it has had on the events industry as a whole. “We saw a significant reduction in our revenues of 50 per cent from our projections, and we had to look at efficiencies for 2020.

In 2021, we’re hoping that the fourth quarter will be quite strong. But it’s really going to be 2022 before we kind of go back into a normal events cycle,” says Lickrish, refreshingly offering pragmatism instead of hubris.

Sponsorship for events has expectedly dried up too. “We’re looking at 20-30 per cent of our revenues generated through sponsorship, the second-highest revenue stream behind ticket sales,” he says, with Flash having tied up with Ticketmaster for ticket sales within the region. “It’s very hard to convince any partner to come in at this time because they don’t know what kind of live event they’re going to be getting.”

The big question for the events industry is what the future of events will look like – will socially-distanced events be the norm?

Lickrish disagrees. “We do have the ability to deal with 30 per cent capacity. However, I don’t think the new normal is going to be socially-distanced events. We [need] to have people be socially responsible instead. gulfbusiness.com

The new normal is just a different set of health and safety rules,” he says.

For Lickrish, the new normal – more than revolutionising the nature of events itself – means that it will more likely get involved in a new set of events, not least of them esports. Flash recently partnered with Abu Dhabi Gaming to launch a quartet of esports tournaments in Abu Dhabi. It includes a DOTA2 competition this month, followed by a PUBG tournament in August, a Fortnite challenge in September and a FIFA22 activation in October. “Through our partnership with AD Gaming, these events will lay solid foundations for the gaming and esports community in Abu Dhabi. We also have a partnership with twofour54 and are working on a variety of different programmes with several private sector organisations to get into esports and create opportunities with international content partners in that space. We’re really excited to be working with them to try and drive some of that into live events,” notes Lickrish.

Lickrish and team are also looking beyond Abu Dhabi. They’ve opened a field office in Dubai, and he says that they’ve recently been awarded contracts for Expo 2020, without divulging the nature or scope of work. “Working with Expo gives us a lot

Above: Etihad Park is the largest outdoor venue in the Middle East and is owned by Flash Entertainment Opposite page: John Lickrish, CEO of Flash Entertainment

of credibility in that emirate. It is a springboard for us into the other emirates.” The plan though is also to seek a larger regional and international footprint. Flash have in the past managed concerts in Lebanon, Qatar and Saudi Arabia. In Saudi, it also brought WWE to Riyadh and Jeddah. “We’re looking at all territories for potential branch offices and operations, whether that be in Israel, India, Qatar or Bahrain where we can work with the government, semi-government and private sectors. In some of the new territories, we see there still may be some scepticism about the longevity of the events industry. We’re here for the long term. This is not just a one-off company coming in trying to reap rewards in the short term. We’ve been here for 14 years, we’re stable, and we can bring that stability into other territories and enhance the industry as a whole.” With Flash’s track record, Lickrish is preaching to the converted.

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BRAND VIEW

A fitness revolution Loren Holland, Frank Afeaki and Ant Martland are co-founders of Dubai-based homegrown affordable fitness chain GymNation. Here’s why they think that their sector is ripe for disruption

H

ow did the idea for GymNation come about?

Holland: Before GymNation, I was involved in private equity in the UK and had previously invested in UK-based budget operator Xercise4Less. The idea for GymNation came about when I relocated to Dubai to work in the corporate finance team for a leading UAE-based education provider and was shocked at the high pricing, annual upfront payments and low quality of fitness facilities available within the UAE. Frank had previous hands-on experience within the affordable fitness sector in Australia, having helped build Crunch, UFC and Hard Candy franchises, which were owned by his family, and Ant had previously managed the sports marketing for brands including Adidas, Reebok and OSN Sports across the Middle East and Africa.

The overall idea behind GymNation was to launch an affordable gym that gave people access to world-class fitness facilities around the clock. As consumers ourselves, to pay over Dhs400 per month, in one upfront annual payment just wasn’t justifiable and we felt that because of this industrywide high price point, too many people were being priced out of the market. Around the time we launched our first club in 2018, Deutsche Bank released a study on the affordability of living costs in key cities around the world with one of the key metrics being the cost of gym memberships. Dubai came out as the second-most expensive market in the world to have a gym membership and that reaffirmed everything we knew.

With over 200 free group exercise classes, more than 500 pieces of cardio, machine and free weights equipment, combat and functional fitness areas, we have created gyms that are as inviting and welcoming for the first-time gym user as they are for the professional athlete, at a price starting from Dhs99 per month.

Ant Martland, Frank Afeaki and Loren Holland, co-founders of GymNation Opposite page: GymNation has seven sites across three emirates in the UAE

the global fitness industry, we were forced to close all of our locations during the lockdown period in 2020, pausing all membership payments and losing this revenue as a result. We quickly partnered with Les Mills to provide free access for everyone in the UAE to their market-leading Les Mills On Demand platform, so that people could continue to work out from home.

Once we reopened, we lost a significant portion of our members who had been made redundant and had to return to their home countries. However, within a few weeks of reopening, we were back to normal again as people quickly realised that it was more important than ever to be fit and healthy. Since then, the performance of our business has been stronger than ever, and whilst there are some capacity and social distancing limitations in place, we continue to work closely with government authorities to ensure we are fully compliant with their guidelines and are providing safe environments for all of our members.

Additionally, as a continuation of our partnership with Les Mills, and a recognition that members still want to work out but sometimes can’t make it to GymNation, we have just launched GymNation On Demand, offering over 1,000 online workout classes that can be streamed online, anytime and anywhere. And whilst our competitors are charging for similar digital workout offerings, we have decided to offer this content for free to both members and non-members across the UAE. How do you ensure a constant supply of highly-skilled trainers and workforce?

Afeaki: We take pride in and put a big focus on ensuring we recruit and retain the best in the UAE market. Prior to joining, all trainers and instructors are vetted to ensure that they have the necessary certifications and meet our strict criteria to operate out of GymNation facilities. We have partnered with UAE personal training company Enhance Fitness,

We take pride in and put a big focus on ensuring we recruit and retain the best in the UAE market

70 June 2020

Give us a business overview of GymNation’s current operations.

Afeaki: We currently have seven open sites across three emirates, and a pipeline through to 10 sites by the end of the year, which will see us finish the year with over 50,000 members.

We are also targeting our first international lease this year and have a plan to open multiple GymNation locations across the GCC over the next few years.

How has Covid-19 affected your business?

Holland: As was the same for the majority of

gulfbusiness.com

which ensures that all personal trainers have a particular focus on regular upskill training. All GymNation staff are also enrolled in our centralised learning management system where they go through regular soft and business skill training and development. As a result of these combined efforts, we have managed to minimise staff turnover.

GymNation recently struck a deal with UAE Rugby. What is the scope of that agreement?

Martland: As a homegrown UAE brand, being an integral part of the communities in which we operate and creating meaningful partnerships within these communities has always been a key priority for us. The UAE Rugby Federation approached us at the start of the year, looking for a partner that could provide their male, female and development rugby teams with 24/7 access to world-class fitness facilities.

Aside from UAE Rugby, we have also recently announced partnerships with the UAE’s leading triathlon community TriDubai, UAE event organiser Super Sports and we continue to work with inclusive sports community Heroes of Hope and provide people of determination the opportunity to excel through employment and access to fitness.

These partnerships, and some others to be announced soon with both government entities and private companies, ensure that we will always remain close to grassroot initiatives.

gulfbusiness.com

How competitive is the fitness market within Dubai and the UAE? Afeaki: The UAE market has several fitness operators ranging from international franchises to homegrown brands. However, fitness penetration rates in the UAE stand at 7 per cent, meaning just seven out of every 100 people own a gym membership or are engaged in regular physical activity. This is very low compared to other mature markets in Europe and the US where it’s common to see penetration rates of over 20 per cent.

Whilst there are a lot of existing gym operators, particularly in Dubai, we do not believe that we are at a saturation point as the market size could, or should, double over the next five years which creates room for many new

entrants and growth of the existing operators.

How has GymNation leveraged tools such as social media to generate original media content?

Martland: Even when GymNation was just an idea on paper, we knew that social media would be one of the main drivers in generating and maintaining awareness of the brand.

We definitely didn’t want GymNation to be one of the many brands that put out substandard, unengaging and unoriginal social media content.

The Matrix campaign, in particular, was a campaign that we scripted, filmed and released in 48 hours for our new Motor City location. We knew that our main competitor, on the floor above us, had finished their renovations and were about to release a standard uninspiring fly-through tour video, so we wanted to come up with something original and highly engaging. Through the video and the on-ground activation of it, where we gave people outside of Control Tower the option to choose between taking a red card, or a yellow card with a free seven-day GymNation pass on it, we generated over 500 new membership signups in less than one week.

June 2020 71

JUL

The SME Story

21

A dedicated hub for the regional startup and SME ecosystem

INTERVIEW

help make it easier for people to purchase, sell, finance and refinance a property.

Could you give us a business overview of Huspy?

A bigger slice A vegan, gluten-free dessert company and an innovative UAE-based proptech startup are on our radar this month Jad Antoun CEO and co-founder, Huspy

What have been some of the biggest stumbling blocks since getting Huspy off the ground?

Attracting the right talent will always be a challenge for a startup. We have secured a top-class team with a mix of experience from tech companies including Microsoft and Uber, fintechs including Nubank and Revolut, and proptech giant Loft. This gives us a deep-rooted understanding of building and scaling the business.

Since we are bringing new technologies to the ecosystem, there is naturally a period where trust needs to be earned and values need to be demonstrated. Successful disruption relies on us getting all our key partners in the industry on board. It’s also dependent on the end consumer feeling confident that we can deliver a superior experience and trusting us to guide them through one of the largest purchases of their lives.

What is Huspy’s core business model?

Huspy is a platform that delivers financing and refinancing of UAE properties. A technology company at its core with in-house real estate expertise, Huspy is addressing the end-to-end experience of the real estate market in the region, building solutions that dramatically speed up and enhance the customer experience, whilst freeing up market liquidity by making transactions faster and more attractive.

What convinced you that the market needs a concept such as Huspy?

I was fortunate enough to work in an early stage startup in the US prior to coming to Dubai and joining the investment team at BECO where we sought out tech companies to champion in the region – Careem and Kitopi, for example. This has given me a real appetite for building tech solutions for real world problems in a region I care passionately about. Thanks to my investment background, I am able to tap into an extensive network of investors both locally and abroad to help bring on this journey with us. While more expats are considering laying down roots here, globally mortgage rates are down and consumers are growing accustomed to more control, emboldened with greater access to information and frustrated by the slow pace of change in the real estate industry. Enter new enterprises like Huspy that 72

July 2021

Starting with the UAE, Huspy will develop a core tech stack for the market and then seek to locally adapt and roll it out across a regional footprint within and beyond MENA. Within just nine months of operations, Huspy has generated +$250m in annualised gross merchandise value and completed over 300 transactions. Huspy is backed by VC investment, has closed its seed round and will continue to raise equity to develop and scale the business. We are currently a team of 30 with core talent in tech, growth, operations, marketing and banking.

How does Huspy compare to other existing proptech firms regionally and globally?

Jad Antoun and Khalid Ashmawy, co-founders, Huspy

Huspy was founded with the aim of bringing a new solution to the real estate market that would end the pain of the home buying and selling process.

Until recently, very little innovation has happened around this area both locally and internationally.

Unlike other industries that have seen themselves disrupted and improved by technology, the real estate industry is relatively untouched. We are in an era of being always-on and of convenience and speed and Huspy has set out to develop technology that can deliver these benefits to the regional real estate industry. gulfbusiness.com

The SME Story

best-selling products – ice creams, banana bread, and cookies – to retail shelves across the UAE. We are selffunded and lucky to have been cash flow positive from the early days.

Your company was initially called Honeymelts. Why did you rebrand it to Majama?

What are some of the plans to scale Huspy?

Right now we are focused on getting our full suite tech stack optimised for the UAE and then rolling out across MENA and beyond, and growing the team to support expansion. In the next quarter, we plan to introduce two new core products that will complement our current solutions and open up our platform to a wider audience beyond financing.

Majama currently sells direct-toconsumer via its website and also through Deliveroo

Riwa Khan Founder, Majama

The natural/healthy food industry is a competitive one, even in the desserts category. There are a lot of global competitors who see the GCC, and specifically the UAE, as a lucrative market. In this context, it’s not easy to stand out. Our ingredient and product quality is what makes people loyal customers, but before that they need to try us out. They’ll only do that if Majama is something that resonates with them, so that’s where our efforts are focused on.

Everything comes down to you and what you could have done differently, whether it was to prevent something or improve it. There are many moments when you’ve made a mistake and there’s no one else to look to but yourself. It has taught me accountability and responsibility, and how to really back myself, learn and get better. I have also learnt to never rush. Whilst we’re all eager for success, it’s never a good idea to make decisions in haste.

Majama started from a simple belief that food can be both natural and delicious, without compromising on taste and texture. This belief is what drives us to create desserts that start off as alternatives to regular ones, but become equally, if not more, satisfying.

I started Majama shortly after graduating from the University in London, where I struggled with constant digestive problems that were worsening with my regular consumption of gluten, refined sugar and dairy. I cut those ingredients out of my diet, but I still craved desserts, so I started making my own.

What are the expansion plans you have in place for the brand?

What is the current scale of your business?

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What are some of the immediate concerns you have for Majama?

What lesson about entrepreneurship have you learnt the hard way?

What prompted you to start Majama?

Majama currently sells direct-to-consumer via our website and also through Deliveroo. We started with only five items on our menu from a shared kitchen in 2018, and we now have over 25 menu options across three product lines (ice creams, treats, and cakes) and 10 employees who work from our own production facility in JLT. This summer, we are taking our

We wanted to break free from the “small bakery” association people had with Honeymelts. In light of our expansion into retail, we wanted our new brand to be a creative expression of our future ambitions and goals. The bright, colourful and illustrative nature of Majama is one we feel our customers can engage and connect with on a deeper level.

It’s a far more accurate representation of our brand personality and the values we’ve developed over the years.

Riwa Khan, founder, Majama

We aim to continue to innovate on the product front by adding more ice cream SKUs and launching new product lines. We then want to ensure these are widely accessible and available, first in the UAE and then across the GCC region. We eventually see ourselves competing in key natural food markets globally such as the UK, US, Germany, Netherlands, India and Australia. Ultimately, we want to be seen as the go-to brand for delicious desserts that just happen to be vegan and gluten-free.

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The SME Story COMMENT

Geoffrey Alphonso CEO of Alef Education

The workforce of the future

A fundamental shift in the tools of teaching are required to prepare students for the jobs of tomorrow

T

he world of work will look very different in the near future.

According to a report released by the World Economic Forum, professions like administrative and executive secretaries, data entry clerks, or accounting, bookkeeping and payroll staff will become obsolete in the UAE by 2025.

Instead, the top emerging roles in the next few years would be data analysts and scientists, digital marketing and strategy specialists, as well as AI and machine learning experts. Even more telling, research

PREPARING A FUTURE-READY WORKFORCE REQUIRES A REVOLUTIONARY APPROACH TO EDUCATION

by Dell Technologies and Institute for the Future suggests that 85 per cent of jobs that will exist in 2030 haven’t been invented yet.

Over the last decade, the Fourth Industrial Revolution has gained ground. We’re witnessing an accelerated adoption of advanced technologies and will unlock job opportunities in fields like AI, robotics, virtual reality, augmented reality, and big data. Hence, preparing a futureready workforce requires a revolutionary approach to education. Traditionally, schools tend to be teacher-centric in their approach, wherein learning is driven by the teacher delivering the lessons and instructions. This relies heavily on the knowledge 74

July 2021

Startup push The SME sector in Oman has grown over the past 10 years, with over 42% of new SMEs registered between 2015 and 2019 A decade of growth Active SMEs in Oman as per year of incorporation 700 600 500 400

of the individual teacher and their method or style of teaching and is essentially just imparting knowledge based on structured curriculum outcomes.

A more contemporary approach, one that has increasingly seen adoption, is the student-centric model where students are active participants in the learning process. In this approach, teachers still impart knowledge, but more as a mentor or coach. Technology is a key ingredient in this learning dynamic, integrating learning management systems or gamification into the process. While both models can deliver some success, preparing and empowering the next generation of the 21st-century workforce requires a step-change. To realise the full potential of today’s learners, there needs to be a paradigm shift in the pedagogical approach to learning.

Moving beyond a one-size-fits-all framework, we need to consider the individual learning styles of the students. And this is where personalised learning that is powered by advanced technologies like AI and machine learning can help.

The Covid crisis underscored the importance of embracing technology in education. As we look at a post-pandemic world, more schools are likely to adopt hybrid learning or distance education. We need to consider ways to deliver learning experiences that are fit for the digital environment and enable schools and teachers to keep students engaged and fully immersed in their lessons.

Educators bear the responsibility of nurturing a generation of digital natives who will grow up to work in fields that we still consider nascent today. This is a responsibility we cannot take lightly, and therefore, how we educate our students needs to change, and it needs to change today.

300 200 100 0

2010

2013

2016

2019

Building up Top business sectors in the sultanate IN 2019

0

10

20

30

40

50

Construction & materials Services Oil & Gas Business support services Real Estate

Local power The vast majority of SMEs are owned

by Omani nationals 75% Omani

LOCAL OWNERSHIP 11% Others

4% Saudi

10% Indian

ENTREPRENEURIAL HUB A majority of the SMEs are registered in the capital Muscat 71%

SOURCE: GULF CAPITAL’S GCC SME OUTLOOK 2020

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