‘The 2016 Economic Outlook’ discussion recently hosted at Capital Club, Dubai’s Premier Private City Club and member of the ENSHAA group of companies, and moderated by renowned speaker, advisor and author Dr Tommy Weir, offered members key insights into what to expect in the coming year regarding the region’s economy. The discussion focused on the retail, energy, and oil and gas sectors, highlighting areas for optimism and areas for caution. Dr Weir kicked off the evening’s discussion by asking: “What should we expect from 2016?”
Retail expert and CEO of MECSC – ICSC David Macadam said: “2016 is going to be an amazing year for retail for those who have their powder dry and are ready to look forward.”
Speaking with reference to the energy, oil and gas sector, Managing Director of Manaar Energy Group, Jaafar Altaie, said that 2016 would be a great year for other areas but not for the energy sector, which faces much uncertainty. He discussed the need for an attention shift from the east to the west of Asian companies, with importance being placed on the projected increase in activity from Iran.
The next question posed by Weir was that of growth, asking: Is 2016 a year to attempt to grow against the odds, or a year to be reserved?
On the subject of retail, Macadam stressed that with the set up of malls in Dubai, vendors will be successful as long as they offer a great product. He later expanded on this point in the Q&A session at the end of the discussion saying that the retail elements that are currently working well are food and beverage. He suggested that investors should identify new food and beverage products that would sit well alongside the current offerings, but be differentiated by the fact that they and are not already over-represented in the market.
For the final question of the evening, Weir asked: “Other than a positive shift in oil prices, what’s foreseeable that can have a positive impact on 2016?”
Macadam said that the investments already made in infrastructure would continue to have a positive impact in 2016.
Altaie, returning to the topic of Iran, said that the promise of better relations with the republic was a positive prospect and the development of that relationship would improve things in the region.
Lahouel expanded on Altaie’s statement, saying that Iran might turn out to be quite important for Dubai. If the embargo is lifted, which should hopefully occur in the first quarter of 2016, Dubai will benefit substantially, especially if we take into account the lagging infrastructure in Iran. He said, “According to our estimates [the lifting of the embargo] can add about 0.5% in overall GDP growth, which is not a small effect coming from a single partner country.”
Based on the predictions of the expert panel throughout the evening, 2016 is set to be an interesting and exciting year for the region and the UAE as a whole. Changes in countries like China, India and Iran, as well as a solid infrastructure developed with great foresight in Dubai, will impact the economic outlook over the next 12 months. The ability to act instead of just reacting is also important, especially in the area of retail, where the process of identifying a niche and fulfilling the need is important for long-term success.