GCC business leaders happy with government action to offset Covid-19 fallout

Remote working and online meetings help GCC workforce adapt to coronavirus crisis

An employee works at her desk iin Dubai.GCC economies have experienced rising activity levels in recent weeks thanks to an upturn in consumer demand and more employees returning to offices. Chris WhitShow more

More than six in 10 chief executives in the GCC were satisfied with their government’s economic response to the pandemic with just under a third planning to relocate supply chains locally to offset further disruption, a new study found.

Sixty-one per cent of GCC executives welcomed the swift action taken to mitigate the effects of the virus, according to a poll of more than 100 by research group Oxford Economics, with 83 per cent reporting disturbances to their supply chains during the crisis and 31 per cent planning to reposition their logistics network closer to home.

“Local businesses across the GCC, as well as those across the globe, have had to react quickly in order to survive,” said Billy FitzHerbert, Middle East regional editor at Oxford Economics.

“The swift response by the authorities witnessed across the GCC, enabled by effective co-ordination between different authorities and underpinned by stimulus packages, have helped bolster the local economy.”

With more than half of the global population under partial or total lockdown by early April, governments across the globe rolled out stimulus measures to keep businesses afloat as the pandemic unleashed the worst recession since the Great Depression of the 1930s, disrupted global supply chains and hampered international trade.

The economies of Saudi Arabia and the UAE bounced back in September, a reflection of rising activity levels as businesses noted an upturn in consumer demand and more employees returned to offices across the region.

The seasonally-adjusted IHS Markit Saudi Arabia Purchasing Managers' Index rose to 50.7 after slipping to 48.8 in August while the UAE headline PMI also jumped to 51 in September from 49.4 in August, the highest reading in 11 months.

Ninety per cent of GCC business leaders implemented remote working and meeting protocols because of coronavirus, according to Oxford Economics with broad-based efforts to bolster digital infrastructure and literacy in recent years now paying off.

Half of the respondents said the pandemic will significantly change communication and interaction with their clients and customers.

“Moving forward, business and consumer sentiment is going to be an important factor as authorities look to get economies moving again, fuelled by consumer and business spending,” Mr FitzHerbert said.