Business confidence in GCC rallies in Q3 to year high

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RENEWED CONFIDENCE: A new HSBC survey shows that business confidence is at its highest level since Oct 2008. (Getty Images)

Confidence levels among business people in the GCC grew in the third quarter, according to the HSBC Gulf Business Confidence Index which was published on Wednesday.

The overall Business Confidence Index moved from 75.9 in the second quarter of this year to 81.4 in the third, the highest score since October 2008.

On almost all measures, the region’s businesses saw better times ahead - on turnover, profit margins, and meeting their targets for the year, the index showed.

The third quarter survey, which covered 1,641 business people in all six countries of the GCC, also revealed that 34 percent of respondents predict a growth in revenue in the next three months, up from 29 percent in the second quarter.


The poll said 30 percent saw an increase in profit, with only 13 percent predicting that profits would fall in the rest of 2009.

Twenty-six percent predicted higher investment levels, compared to 22 percent in Q2 while only 16 percent expected to see their workforce shrink in the next year, compared to 25 percent who reported job losses in the past 12 months.

“The mood of optimism in the region has increased steadily since its low-point at the start of the year,” said Simon Vaughan Johnson, regional head of Commercial Banking, HSBC Middle East.

The results support a earlier HSBC poll of UAE trading companies which showed the UAE was one of the top three most confident countries in the world on trade activity and growth.

“All the indicators are pointing in the same direction,” added Johnson. "These indicators echo the sentiments of our clients, who tell us that the feeling is that the worst of the slowdown is behind us, but it is too early to declare victory over the global economic recession.”

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