Mideast's 83% of businesses seen to return to pre-Covid-19 profitability by 2022
December 06 2020 09:07 PM
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Businesses surveyed in the Middle East say they have adapted to the changing environment, and while
Businesses surveyed in the Middle East say they have adapted to the changing environment, and while optimism has naturally dipped since 2019, companies are more optimistic than the global average.

The difficult conditions of this year haven’t dampened the mood among businesses from the Middle East, according to the latest HSBC ‘Navigator’ report.
Businesses surveyed in the Middle East say they have adapted to the changing environment, and while optimism has naturally dipped since 2019, companies are more optimistic than the global average.
The report said 77% expect their business outlook to stay the same or become more optimistic, compared with 67% globally. Within this, close to half (46%) of all Middle East businesses surveyed feel more optimistic.
Also, 83% of respondents from the Middle East expect to return to pre-Covid-19 profitability levels by the end of 2022 (compared with 81% globally), which includes 20% that are either ahead or expecting to be back there by the end of 2020.
HSBC Qatar CEO Abdul Hakeem Mostafawi said, “We have seen new levels of optimism in the local economy with business activity returning to pre-Covid-19 levels. Qatar’s resilience is clear to see in the innovative ways that businesses have adapted to new market conditions and trading dynamics.”
HSBC Navigator draws from a survey of over 10,368 companies in 39 markets, including 711 from the Middle East, North Africa and Turkey (Menat) making it the largest survey of its kind.
The report also reveals that businesses in the Middle East recognise the need to invest for future growth, with 83% of respondents intending to increase their investment in their business next year, compared to 67% globally. The three most commonly cited investment priorities are product and process innovation, marketing, and cash flow/capital management.
Daniel Howlett, HSBC’s regional head of Commercial Banking, Menat, said: “Despite the slowdown during the pandemic, business is slowly returning to pre-Covid-19 levels and companies are finding ways to maximise their potential, adapt to the new environment, and really focus on sustainable measures that will help their companies grow and be able to future-proof them from unexpected disruptions.”
While 73% of businesses from the Middle East feel that international trade has become more difficult due to impact of events in the last 12 months, their commitment to pursuing international opportunities appears undiminished, the report said.
When asked about their outlook on international trade, most Middle East companies (86% compared with 72% globally) said they have a positive outlook over the next 1-2 years. Eleven percent have a negative outlook, compared with 22% globally.
In response to the challenging international trade environment this year, HSBC accelerated its long-term commitment to digital banking. In the first nine months of the year, around 70% of the $43bn of trade financed by HSBC in the Middle East was processed digitally, compared to 54% processed digitally over the course of 2019.
The Navigator report illustrates how sustainability is an important focus for business leaders in the Middle East. Almost all companies (98%) in the Middle East see multiple opportunities from improving their environmental and ethical sustainability, the three most important being attracting investment, enhanced reputation and promoting employee well-being.
Companies surveyed in the Middle East also said a greater focus on sustainability is expected to drive growth: 33% expect modest growth of up to 5%, 33% expect growth of between 6% and 9%, and 29% expect growth of 10% or more.
HSBC in October announced an ambitious plan to prioritise financing and investment that supports the transition to a net zero global economy, citing a landmark opportunity to build a thriving, resilient future for society and businesses.
The bank is committing to align its financed emissions – the carbon emissions of its portfolio of customers – to the Paris Agreement goal to achieve net zero by 2050 or sooner.
HSBC has both the scale and global reach to play a leading role in guiding its customers through this transition and helping them to achieve this ambitious goal. The bank also aims to be net zero in its operations and supply chain by 2030.
The last few months have seen the Middle East’s sustainable finance market deepen and become increasingly diversified. In Qatar a number of landmark deals indicate the renewed focus on sustainable financing, such as the debut green bond issued by QNB that sold $600mn in five-year notes, the largest issuance by a financial institution in the Middle East.



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