JEDDAH — Saudi private sector is expected to create more jobs or hire talent in the next 12 months, a survey has said. According to the survey, conducted by the Economist Intelligence Unit (EIU) of Ernst & Young's, 90% of respondents in Saudi Arabia believed that the global economy was improving or stable and 97% were confident in economic growth in the Kingdom. The survey said 81% of senior executives in the Mideast and North Africa (MENA) region believe that the current regulatory environment provides support for business growth. The barometer gauges corporate confidence in the economic outlook, and it identifies boardroom trends and practices in the way companies manage their capital agenda. Survey respondents comprised of senior executives including C-suite executives at major corporations across the region. The study also showed that business confidence across MENA was broad based, with respondents positive on global economic growth, corporate earnings and employment levels, and significantly more positive on credit availability and improvement in short-term market stability since the last survey in October 2012. Sentiment was also broadly positive for growth across MENA, with 90% of respondents expecting the local economy to grow in the next 12 months and half of all companies surveyed (50%) believing that growth will exceed 3% over the next 12 months. The appetite for acquisitions globally and particularly in MENA is more positive than six months ago and is driven by the increase in number and quality of opportunities. Globally, 29% of the respondents expect to pursue acquisitions in the next 12 months compared to 46% in MENA. Phil Gandier, MENA head of Transaction Advisory Services, Ernst & Young, said: “There is a clear positive sentiment amongst respondents in MENA on regional economic growth, particularly in regard to corporate earnings growth and short term economic stability. The favorable regulatory environment and improving confidence across the region could be possible drivers of the increased appetite for acquisitions and will hopefully encourage companies to create more jobs and to further grow their businesses.” In the UAE, the outlook for future growth in the country has improved dramatically with 64% of UAE respondents believing that the local economy continues to improve, and 36% believing it to be stable. Additionally, UAE respondents are also increasingly confident in improvements in employment growth, corporate earnings, equity valuations and stock market outlook. However, perceptions of the local Egyptian economy weakened over the past six months with 40% of respondents expressing confidence in the economy growing compared to 88% in October 2012. Confidence in the local Qatari economy also decreased over the last six months, with the number of respondents who believe the local economy is slowing down rising to 20% compared to 10% last October. MENA respondents indicated they had high cash liquidity, with 53% stating that they will use cash as the primary source to fund deals in the next 12 months (compared to 29% in October 2012). In addition, only 16% of MENA respondents plan to to use debt as the primary source of deal financing over the next 12 months compared to 60% six months ago. — SG
