A new report has revealed that the private sector has performed well in 2015 so far, with UAE SMEs saying they are either positive or very positive on their growth outlook.
The UAE SME Sentiment Survey – Q1 2015, the inaugural survey of Gulf Finance Corporation, a wholly-owned subsidiary of SHUAA Capital, found that for 85 percent of SMEs increased production in the first quarter of 2015 while three out of four businesses have increased their headcount.
Furthermore, 70 percent of SMEs saw a noticeable improvement in payment collection.
Nine out of 10 claimed their ability to raise finance had markedly improved since the turn of the year.
Among them, the well-established or high growth companies benefited the most, partly due to improvements in access to finance, which was experienced by 27 percent of companies with 20 to 50 employees, and 31 percent of companies with a turnover of between $2-5 million.
Commenting on the Q1 survey results, David Hunt, CEO of Gulf Finance (pictured), said: “The key takeaways are twofold. Firstly, an increase in confidence in the overall health of the UAE’s economy.
“Secondly, an increase in funding solutions to the sector as financing companies gain comfort in the fact that SMEs are witnessing a noticeable improvement in payment collection.”
Speaking about their sentiment for Q2 2015, Hunt added: “I found it interesting that employee benefits were at the bottom of the investment plans for SMEs.
“Only those established companies or those with small revenues, but high growth potential see the value of investing in employee welfare and long-term incentive plans.”
When questioned about their future plans, only 16 percent of SMEs planned to invest in employee benefits, with 20 percent preferring to invest in expanding into new geographies and 63 percent, mainly from the logistics and finance sectors, planning on expanding their product range.
In general, 93 percent of respondents are either positive or very positive on their growth outlook, and 90 percent of the surveyed are expecting sales in their company to rise, with over one in two forecasting it to from one percent to 20 percent.
Hunt concluded by saying that the findings suggest that the UAE SME sector was feeling optimistic, which was an encouraging development given the importance placed on the sector by the government.
“The respondents have experienced markedly improved payment collections, a rise in orders and production, increased recruitment and considerably better access to finance,” he said.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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