By Gavin Gibbon
Latest HSBC report reveals just 1% feel their long-term survival is threatened by global pandemic
Almost 80 percent of companies in the UAE have admitted to being “strongly impacted” by the ongoing coronavirus pandemic, according to the latest report from banking giant HSBC.
The ‘Building Back Better’ report, which surveyed over 2,600 companies in 14 countries and territories, revealed that the impact in the UAE was above other markets (72 percent), while the country was the second highest, after India, to concede that the impact had been felt ‘very strongly’ (42 percent).
From the 100 companies surveyed in the UAE, just under a fifth (18 percent) said they were sufficiently agile to make them stable. However, only one percent feel that their long-term survival is threatened.
Daniel Howlett, HSBC’s regional head of commercial banking, Middle East, North Africa and Turkey (MENAT), said: “The Covid-19 pandemic is acting as a catalyst for change at many UAE businesses and altering the way they work. UAE businesses have always had a strong entrepreneurial spirit, and we are seeing that come through in how they are adapting to new ways of working and in how they are accelerating transformational plans.
“It is vital that the UAE private sector pushes ahead with efforts to make their businesses more agile and more resilient.”
For many UAE businesses, their supply chains have come into focus over the last few months - 72 percent said they intend to increase measures to ensure the security of their supply chains over the next one to two years (compared to 67 percent in all markets), with the most important measure being to identify and secure critical suppliers (38 percent).
Employee morale was the top barrier to build resilience in the UAE, with almost half (47 percent) viewing it as a major concern – this is particularly pronounced at international operators (61 percent). The next most prominently cited barriers were maintaining sufficient cash flow (36 percent) and external factors beyond their control (35 percent).
The crisis has also forced many businesses to rethink their technology investment strategy, with 66 percent of businesses in the UAE strongly agreeing that times of adversity showcase how technology can be better leveraged to enhance or improve how they work - investing in technology is what many UAE companies (64 percent) plan to do over the next five years while a quarter of businesses view it as a top priority.
What the crisis has also shown to businesses is that sustainability is more important than ever before. Almost all UAE businesses (95 percent) agree on the need to reassess their operations to be built on firmer environmental foundations.
The three top aspects of sustainability which UAE businesses expect will directly impact their business were air quality, sanitation/pollution (46 percent), digitalisation of healthcare (44 percent) and the circular economy (43 percent).