Bahrain : According to Ernst & Young’s inaugural World Islamic Banking Competitiveness Report 2011, Islamic banking assets with commercial banks globally will reach US$1.1 trillion in 2012, a significant jump of 33% from their 2010 level of US$826 billion. The report also highlighted that Islamic banking assets in the Middle East and North Africa (MENA) region increased to US$416 billion in 2010, representing a five year CAGR of 20% compared to less than 9% for conventional banks. As new geographies open up to Islamic banking, the MENA Islamic banking industry is expected to more than double to US$990 billion by 2015.

The report was presented at a special plenary session of the 18th Annual World Islamic Banking Conference today where more than 1,200 industry leaders from over 50 countries gathered to chart the future of Islamic finance. The report explores key industry trends and critical success factors guiding the global Islamic banking and finance industry into its next chapter of performance and growth.

Ashar Nazim, MENA Islamic Financial Services Leader, Ernst & Young, said: “The global Islamic finance industry continues its quest to boost international competitiveness and to build a sustainably profitable business model. Both the challenge and the opportunity currently facing leading industry players is how will Islamic banks succeed in making the historical growth curve sustainable.”

Growing Islamic banking assets and market share

Islamic banking market share of all banking assets in the MENA region has reached 14%, whereas in the GCC it crossed the all important 25% threshold in 2011. The report expects that there will be a change of play going forward as Islamic banks compete for mainstream customers who are open to Islamic or conventional banking.

Ashar adds: “A worrying concern is the limitations in the enabling legislative, regulatory, tax and legal environment in most OIC markets, which add to the cost and complexity of Islamic banking operations. Where there are guidelines and standards issued by industry infrastructure institutions, their reach and enforceability remains a concern. These must be addressed as priority.”

Performance risks and advantages

The report cautions that the Islamic banking industry is still fragmented with most Islamic banks holding less than US$13 billion in assets and are yet to achieve scale as they face pressure on profitability. In addition, exposure to downgraded real estate markets remains a concern for Islamic banks and this may also affect future growth.

Business repositioning, mergers and acquisitions and conversions appear set to dominate MENA Islamic banking in 2012. A sizeable decline in industry profitability from 2006 levels of returns on equity of 23% to the present levels of around 10% have left Islamic banks exposed to the charge of operational deficiencies. Clearly, the structural advantages of stronger retail focus begetting better financing margins, higher deposit growth and higher proportion of free deposits needs to be translated into higher profitability. However, misaligned people-processes-systems have led to high cost to income ratios for most Islamic banks.

“Higher provisions and operating costs have contributed to the steep decline in profitability of Islamic banks. Returns on assets have dropped from 4% in 2006 to 1.5% in 2010, due to deteriorating asset quality,” added Ashar.

The CEO Agenda

According to the report, two key themes are starting to emerge. The first is the need for excellence in banking operations and the second is to improve product innovation. The combined MENA Islamic banking profit pool could rise to US$15 - 19 billion in 2015 from the 2010 levels of US$5 - 6 billion, primarily by  combining operational transformation with a more robust risk infrastructure. Potential growth opportunities for regional Islamic banks include the emerging Islamic geographies, growing affluence among retail customers, better alignment with real economy and rising SME banking.

“Ensuring sustainable growth will require brave, meaningful and decisive performance improvement initiatives. CEOs and boards appear keen on transforming operating models for quality growth and to create sustainable shareholder value,” added Gordon Bennie, MENA Financial Services Leader, Ernst &Young.

“Reduced profits and valuations are amongst the biggest business risks facing Islamic banks, which can partially be tackled by introducing a service driven culture, investing in customer centric activities, and with better use of technology and risk management tools. Sharpening of their Shari’a differentiation by acquiring and building specialist product skills and ensuring better integration with the real economy will help CEOs to take their banks to the next phase of growth,” said Gordon.

Call to establish iSWF

The growth opportunities in OIC markets are clear. The best way to take advantage of them, however, is not. With the growing internationalization of the industry, the report says that now would be the opportune time for the industry to consider establishing Islamic sovereign wealth funds (iSWF).

“Most Islamic banks remain localized to their GCC base which makes it very difficult to get a holistic picture of emerging markets and opportunities.  iSWF could provide this visibility very effectively.  As the lead promoter, the iSWF would attract significant interest from other financial institutions, helping the industry grow in a sustainable way,” concluded Ashar.

IPEX Digital Middle East which opens today (14 November) at the Abu Dhabi National Exhibition Centre (ADNEC) will provide a platform for digital technology in commercial and large format printing sectors as well as online marketing and social media discussion relevant to the Middle East region.

“IPEX will bring together businesses involved in print production, creative and design, print finishing, pre-press, photography, publishing and many other sectors of the industry – both global and regional,” said Binu Pillai, Exhibition Director of IPEX Digital Middle East.

HP, a gold sponsor of IPEX, will be showcasing their ‘versatile’ printing solutions for graphics, as well as books and publications. HP Scitex LX850 3.2m and HP Scitex FB500 1.63m printers will form part of the wide-format technology line-up, along with HP Designjet Z6200 and Designjet L25500 printers – the latter a 1.52m machine suitable for indoor and outdoor graphics such as car wraps and soft signs.

Running alongside IPEX is Signage, Imaging and Media (SIM), sponsored by Advanced Interactive Media Solutions, which will focus on the exponential growth of social media and other online marketing communications throughout the region.

“At SIM we have the Digital Out of Home (dOOh) media forum, which takes place on 15 November, will discuss the current trends and drivers in the industry and provide insight into the successful development of digital signage in the Middle East, an industry which is estimated to be worth in excess of $6.5 billion in the first six months of 2011,” said Pillai.

A firm favourite at SIM is the Social Media Forum, which takes place on day one of the show. The seminar features social media experts and media communication leaders to discuss the impact and future direction of social media on the region’s marketing, media and communications.

A key issue to be discussed at the forum this year is the fundamental changes taking place in consumer behaviour online, which consistently challenge the region’s marketers.

“The changes in consumer behaviour being driven by digital innovations such as social media are fundamental and important. There are a number of forums in the region that examine the movement towards digital information consumption, sharing and activation and the Social Media Forum is an important platform for communicators and marketers in the UAE to examine quite how they can make the most of the challenges and opportunities these changes in our behaviour represent.” said Alexander McNabb, Director, Spot On Public Relations who will chair the Social Media Forum.

“There are some really strong speakers at the Forum, some smashing case studies and a great deal of expertise available on the stage. The Social Media Forum should be a powerful tool for information sharing and debate” added McNabb.

Although IPEX Digital Middle East will be an annual event, the event as a brand has an impressive pedigree. Its UK event only takes place once every four years, and the 2010 edition in London attracted over 50,000 visitors from 135 countries and 1,000 exhibitors from 40 different countries.

“With digital technology driving innovation in the sector at an unprecedented pace, it is now essential for industry players to stay connected to this fast-paced marketplace,” commented Pillai.

Also exhibiting at the show are silver sponsors Konica Minolta Holdings Inc, a Japanese manufacturer of office equipment, medical imaging, graphic imaging, optical devices, and measuring instruments.

Trade benefits foreign relations & social development as well, says Minister

September 27, 2011

H.E. Sheikha Lubna Al Qasimi

Minister of Foreign Trade H.E. Sheikha Lubna Al Qasimi outlined the various elements that make the UAE an important regional hub for trade and investments during a speech delivered today (Tuesday, September 27, 2011) as part of the 3rd Annual Trade Finance Middle East Conference running until tomorrow at the Jumeirah Emirates Towers in Dubai.

Organized by Euromoney Seminars and Trade Finance Magazine, the conference has gathered the region’s industry and government leaders to explore ways to enhance trade and create new and lasting business relationships. In her speech, H.E. Sheikha Lubna pointed to expanded trade, economic diversification and exceptional leadership as key factors to the Middle East’s resilience against the global economic crisis. She nevertheless recommended taking a cue from the World Trade Organizations cautious forecast of a 6.5 per cent growth for the region.

The Minister also discussed the important role of the GCC in sustaining the Arab World’s growth, noting that the Gulf is more closely integrated in the globalization process compared to the rest of the Middle East. She later enumerated the various business and investment incentives offered by the UAE that have made the country a regional base for over 25 per cent of the world’s top 500 companies, including a stable political landscape, an open economy, a modern banking and financial system, more than 30 world-class free zones, tax-free environments and close proximity to the top markets of Europe and Asia.

H.E. Sheikha Lubna explained that the fruits of robust international trade were not all purely economic in nature: “The benefits of foreign trade for our region are not just economic in nature; energetic trade has helped us strengthen our relationships with the global community, push ourselves to technological and infrastructural growth; broaden the participation of women in business, and diversify the types of employment available to our citizens. All in all, foreign trade has had a profound impact on the fortunes and the way of life of the peoples of the Middle East,”

The UAE Government Strategy for 2011-2013 aims for more strategic directions in trade and investment to maintain the Emirates’ strong global standing. Plans are underway to optimize strategic infrastructure and enhance multi-modal transport, encourage more local entrepreneurism, create additional jobs, introduce long-term reforms and capitalize on the technical, trade and economic agreements the country has signed with more than 30 countries. Inspired by the ancient ‘Silk Road’ trade routes, the UAE is also reinforcing and redefining its commercial ties with fellow emerging markets as well, with particular focus on short- and long-term investments, knowledge and technology exchange, human capital development, and managerial best practices.

Groundbreaking of world-class office tower held today

September 20, 2011

Al Hilal Bank, a progressive Islamic bank, has today (Tuesday, September 20, 2011) held a groundbreaking ceremony for its flagship commercial development located at the heart of the Sowwah Island mixed-use development in Abu Dhabi.  The 120 metre-high tower will offer exceptionally efficient, Class A office space to leading national and global firms.

Sowwah Island and adjacent edges of Al Mina, Al Reem and the Abu Dhabi Islands are designated as Abu Dhabi City’s Central Business District under the Capital 2030 urban structure framework plan. Al Hilal’s tower will thus be strategically positioned at the center of the capital’s downtown district, upcoming developments at Al Reem Island and Mina Zayed, and the new cultural district on Saadiyat Island. The office tower has direct access to three main island roads and the upcoming Central Park, Cleveland Clinic Abu Dhabi and the Abu Dhabi Stock Exchange. 

The new Al Hilal facility will be serviced by a state-of-the-art, multi-tiered transportation infrastructure which will include a planned Light Rail station. It will include over 1,000 parking spaces for tenants, a high-class retail component at the ground floors and 25 commercial office levels. The building comprises over 34,000 sqm of office space and 700 sqm of retail area available for leasing. Floor plate efficiencies reach the high 80s and the development complies with the Estidama Pearl Rating System requirements. Completion is scheduled for the last quarter of 2013.

“Al Hilal Bank is very proud to commence work on our key contribution to Abu Dhabi’s 2030 Vision. Our tower supports Sowwah Island’s mission of drawing in world-class organizations to redefine Abu Dhabi’s business landscape. It also shows our commitment to socially-responsible growth, as the tower’s elements have been designed to minimally impact the environment and are aligned with Estidama’s overarching sustainability principles. Our future commercial developments will mirror the same high standards we have set for our flagship tower,” said H.E. Ahmed Ateeq Al Mazroui, Chairman of Al Hilal Bank.

Al Hilal Bank is fully owned by the Abu Dhabi Investment Council, the investment body of the Abu Dhabi Government. It currently operates 19 local branches plus three in Kazakhstan. Al Hilal recently received the ‘Quality Appreciation Award’ from the Sheikh Khalifa Excellence Award, the UAE’s most prestigious business excellence award. The bank has also been awarded ISO 9001:2008 certification by German management systems certification body DQS-UL Group for its outstanding compliance with international Organizational Excellence, Employee Relations, Recruitment, Talent Management, Performance & Rewards, and Budget & Payments standards.

SKOPOS Consulting Group: Family businesses in the Middle East should prepare for succession to effectively manage change

July 11, 2011

Dr. Hussein El Kazzaz, Managing Director, SKOPOS Consulting Group

SKOPOS Consulting Group, a leading provider of customized Organization Development (OD) solutions to companies in the Middle East and Africa, has cited recent research which reveals that more than 90 per cent of all commercial activity in the GCC is controlled by family businesses, compared to 65 to 80 per cent in other parts of world. Almost three-quarters of the region’s family businesses are owned and managed by the second generation, and one-fifth by the third generation. According to SKOPOS, this scenario reaffirms the importance for family businesses in the region to incorporate organisational development mechanisms to ensure long term success and profitability.

Business continuity is the key for family businesses as research has shown that fewer than 6 per cent of all family businesses worldwide survive to the third generation, especially in regions such as the Middle East. An estimated 75 per cent of the Middle East’s private economy is governed by around 5,000 families whose companies generate 70 per cent of regional employment.

“Family businesses in the Middle East should prepare for succession to effectively manage change. Developing the next line of leaders is crucial to ensuring longevity and sustained success of the company, especially given the rapidly changing and highly competitive business environment in the region. Incorporating a well-planned organisational development framework that includes leadership development programs will contribute to more effective management, greater long term stability and continued business success,” said Dr. Hussein El Kazzaz, Managing Director, SKOPOS Consulting Group.
     
SKOPOS Consulting Group advises family businesses to be aware of the various issues arising from the gradual growth of their organization, and identifies three ownership stages that family businesses need to especially focus on, namely the Founder(s) (Stage1), the Sibling Partnership (Stage 2), and the Cousin Confederation (Stage 3). According to the group, Stage 1 requires a focus on leadership transition, succession, and estate planning. The group points to sustained family ownership, succession, and teamwork and harmony as key issues in Stage 2. For Stage 3, SKOPOS notes the possibility of conflicts in the allocation of corporate capital, shareholder liquidity, mission and vision, member conflicts, business participation and roles, and linkage with the business.

SKOPOS Consulting Group is leading provider of advanced executive coaching, corporate team building, and soft and hard skills development solutions across the MEA region. It was founded in 1991 in San Jose, California, USA but then moved to the Middle East in 2002 to focus on delivering high-quality Organization Development solutions to the region. SKOPOS has offices in Dubai, Cairo and Bahrain.

Commercial Vehicles Middle East exhibition and conference open  against healthier industry backdrop

Dubai, UAE, 14 March 2011:  Major manufacturers, industry experts and transport, fleet and logistics decision makers from the Middle East road transport business shared the stage as the commercial vehicles industry’s biggest regional event opened in Dubai today.

Running for three days at Dubai International Convention and Exhibition Centre, Commercial Vehicles Middle East is expected to reinforce new optimism that an industry hit hard by the economic downturn in recent years is now well on the road to recovery.

The exhibition is being staged in tandem with the Commercial Vehicles Conference, creating a dual platform with a double focus on cost saving as well as the future of environmentally friendly transport.

A panel of industry experts from leading transport organisations will be debating key issues over the first two days of the conference ahead of a workshop on the final day to analyse future plans for effective fleet management of heavy and light commercial vehicles.

While overall figures for commercial vehicle sales in the region are not yet available for last year, recent research in the countdown to the industry showcase in Dubai underlines a revival for the trade.

In the first half of 2010, sales of commercial vehicles in the GCC countries - including trucks, busses, vans, pick-ups and utility vehicles – leapt by 37.97 per cent to 253,790 over the same period in 2009.

CVME 2

The UAE led the way with a 54 per cent rise to 53,683 units sold, while Kuwait (49%), Oman (41%), Bahrain (38%), Saudi Arabia (29%) and Qatar (24 %) also enjoyed significant sales increases.

Overall last year, commercial vehicles sales in Saudi grew by five per cent from 116,398 units in 2009 to 122,275 last year. An increase of almost 7% to 130,616 units is forecast for this year, and this figure is forecast to rise by 31% to 171,274 by 2014.

In Kuwait, commercial vehicle sales last year amounted to 32,494 units with a value of US$1.71 billion, compared with 32,029 units worth US$1.67 billion in 2009. Projections are for growth to 33,046 units this year, and to 36,889 by 2015.

This is certainly encouraging news for companies like Liberty Automobiles, the General Motors dealer in the UAE and one of the sponsors of the event, which is organised by Streamline Marketing Group.

Rubbing shoulders on the exhibition floor with global names like TATA and Renault Trucks, the company is making full use of Commercial Vehicles Middle East to influence a major gathering of industry buyers, including government agencies such as Dubai’s Roads and Transport Authority and the Department of Transport in Abu Dhabi.

In addition to presenting the latest range of Otokar buses from Turkey, Liberty will also grab a good deal of attention by spotlighting the world’s first 100% electric, zero emissions passenger bus from US manufacturers DesignLine Corporation.

During the exhibition DesignLine and Liberty are expected to announce more details of a recently announced joint venture to set up a $US30 million, 100,000 sq ft manufacturing facility in Abu Dhabi for the Eco-Smart 1 electric bus.

CVME 3

Creating 300 jobs, the plant will have the capacity to manufacture up to 300 Hybrid and All Electric buses per year. The new facility is expected to open before the year’s end, with projected revenues for its first year in excess of US$80 million.

The tourism and hospitality sectors are seen as the major customers for the Eco-Smart 1 electric bus which consumes no fossil fuels and generates zero emissions. Its significance is highlighted by research information from the International Energy Agency which shows that CO2 emissions from the transport sector in the GCC States are some of the highest per capita in the world, underlining the need to find more sustainable forms of transport.

Commercial Vehicles Middle East (www.commvehicles.com) covers all types of heavy and light commercial vehicles, special vehicles, vehicle attachments, accessories, maintenance and repair services.

One of the expert speakers on the opening day of the Commercial Vehicles Conference is

Richard Elviss, Regional Director of AECOM Transportation UK, who will analyse ways to reduce fleet operating costs. According to Elviss, simple but effective processes such as regular driver training and correct aero-dynamics for commercial vehicles can add to significant savings of fuel consumption costs, which amount to as much as 33% of total fleet operating costs.

• Swiss Development Group is redeveloping 24 luxury private hotel residences
• Innovative facilities and world-class design by BBGM and EDSA
• Located in one of Europe’s most popular tourist destinations

Dubai, UAE; February 14, 2010: Hamptons International, the premier property services company with a global portfolio of prestigious projects, has entered the Switzerland market with a property marketing contract for the prestigious Du Parc Kempinski Private Residences developed by Swiss Development Company (SDC).

Located in the picturesque hills of Mont-Perelin, one of Switzerland’s most frequented and preferred tourist destinations, Du Parc will feature 24 luxury hotel residences that are being redeveloped by SDC. World-renowned interior designers BBGM and landscape expert EDSA are working on revamping Du Parc, earlier a hotel.

A representative of Hamptons International said the Swiss expansion of the company’s portfolio will be a perfect fit for its exclusive global client base, especially those based in the Middle East region. “Switzerland is an exclusive holiday destination for visitors from the Middle East region. The Du Parc project offers owners privacy and ease of access to the mountain resorts of Verbier, Gstaad and Zermatt by a short helicopter ride and will be an ideal second or third home thanks to the pleasant climate, beautiful scenery, sense of security and the hospitality of the locals.”

They added: “Du Parc offers four distinctive advantages – the association with one of Switzerland’s trusted developers; breathtaking location; elegance of design and exceptional service provided by Kempinski. With only 24 apartments, Du Parc will be an exclusive address, and will pamper guests with an array of innovative facilities and impressive design.”

Nicolas Garnier of Swiss Development Company said the partnership with Hamptons offers strong inroads for the company to reach out to a wide customer base in the Middle East region, specially. “Du Parc is the first of its kind serviced residence in Switzerland and our redevelopment focus on design aesthetics will be complemented by the service expertise of Kempinski.”

Located in a classical Belle Epoque style building and set in 3.2 hectares, Du Parc homes are located above Lake Geneva in the heart of the Lavaux region. They are described as ‘beyond luxury’ apartments to highlight the pampering lifestyle experience that awaits customers. Five star hotel service will be provided by Le Mirador Kempinski Mont-Pelerin and international concierge services by Quintessentially. A cigar lounge and a 650 sq m private spa are other features.

Swiss Development Group SA was founded in 2007 to create and develop high-luxury, landmark real estate projects, including five-star condominium hotels and luxury private hotel residences in Switzerland and around the world. The company redefines the scope and depth of luxury living by going beyond property to create the ultimate lifestyle options for its clients.

Hamptons has a strong presence in the Middle East and North Africa region through offices in Dubai and Abu Dhabi in the UAE, Oman, Saudi Arabia, Egypt and Morocco. Acquired by Emaar Properties in 2006, Hamptons International has headquarters in Dubai and London, and features a diverse project portfolio in addition to offering property management, valuations and research, advisory and mortgage services.

107 retail developments currently operate within the country, reveals latest ‘RETAILFocus’ report Read the full story