MENA SME respondents report accelerated increase in positive economic outlook.
Middle East now shows highest level of business confidence Globally
MENA SMEs expanding Internationally set to double by 2013
Qatar confidence rating increases to 146 from 137 (neutral reference is 100)
Small and medium enterprises in the Middle East continue to top the HSBC's Small Business Confidence Monitor, with Qatar second in the MENA region, and the Middle East region scoring higher than the aggregate scores for Emerging Markets, Developing Markets and the overall global figure. The data shows that 54% of Middle East SMEs see a positive economic outlook over the next six months and 59% are looking to increase capital expenditure (capex) during 2011. MENA SMEs looking to expand Internationally by 2013 is also up to 52% from 27% in 2010.
Business confidence among Qatar's small and medium-sized enterprises (SMEs) increased to 146 from 137 in 2Q10. The Middle East Region scored 151 (up by 19) with Developed markets reducing by 10 to 105 and the Global figure also lower, by 4 to 114.
The bi-annual HSBC Small Business Confidence Monitor gauges the outlook of SMEs on local economic growth, capital investment plans and recruitment. The latest wave is the largest international survey of its kind covering 6,389 SMEs across 21 markets in Asia, the Middle East, Europe, North America and Latin America.
Global levels of confidence
Confidence in future business growth among small and medium enterprises (SMEs) within emerging markets continues to increase, while levels in developed markets have dropped, according to HSBC's bi-annual Small Business Confidence monitor. MENA emerged as the global leader in terms of SME business confidence, whilst overall Middle East respondents reported the highest levels of confidence.
Alan Keir, HSBC's Global Head of Commercial Banking, said: "Increased private consumption, global re-stocking and liquidity from the West have helped boost the emerging market economies. The emerging markets play a vital role in driving the global economy and SMEs in these markets are once again demonstrating their strength and positivity on the global stage."
The number of SMEs looking to expand Internationally has grown globally from 29% to 40% with growth expected in every Region as the World becomes evermore joined up. The highest growth is expected to be seen in MENA Region with the number of SMEs opting for international expansion almost doubling from 27% to 52% and this also compliments the developing domestic/intra-region growth expectations.
"It is hugely encouraging to see such strong SME business confidence in Qatar reflecting the extremely positive environment for business growth. 52% of SMEs across the MENA region are looking to expand internationally which will also ensure that this growth remains sustainable in the longer term. " commented Fadi Fattal , Head of Commercial Banking. "Intra-regional trade within the Middle East continues to develop at a steady pace, with opportunities for Qatar SMEs across a number of sectors. However, we believe that the growing importance of trade with emerging markets is also an important factor driving SMEs to consider international business as a revenue generator .With the awarding of the 2022 FIFA to Qatar, we expect the SME confidence index to continue to improve in light of the economic activity, in multiple sectors of the economy, expected to come on stream which HSBC is keen on supporting
Outlook on local economic growth
The majority (52%) of SMEs in Qatar are still expecting the pace of the general business environment, as measured by economic growth, to increase.
In terms of economic growth over the next six months, 85 per cent of SMEs have a positive outlook with over a third (37%) of SMEs globally expecting growth to increase and half (48%) expecting the current pace of growth to continue. In Emerging markets 43 per cent of SMEs expect the pace of growth to increases versus only 10% of SMEs in Developed markets.
Outlook on capital expenditure
Over half (53%) of Qatar SMEs are planning to increase their capital expenditure plans with 43% maintaining their current high levels and only 4% looking to reduce.
The majority (89%) of SMEs across the globe are planning to increase (44%) or maintain (45%) their current capital expenditure plans in the next 6 months. The leading local areas planning to increase capex include Saudi Arabia (76%), Egypt (56%), Qatar (53%) and UAE (50%).
Outlook on recruitment plans
Staff recruitment is expected to rise globally with 30% of SMEs seeking to recruit staff and this figure rises to 47% for Qatar with 50% seeking to maintain current levels. Across the Middle East this figure is 44%.
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Footnotes
1: Emerging markets include Hong Kong, India, Indonesia, mainland China, Malaysia, Singapore, Taiwan, Vietnam, Egypt, Qatar, Saudi Arabia, UAE, Turkey, Argentina, Brazil, Panama and Mexico.
2: Developed markets include US, Canada, UK and France.
More details of the survey
This is the sixth wave of the HSBC Small Business Confidence Monitor, which was conducted in May and June 2010 by research agency TNS for HSBC Commercial Banking. The results were used to calculate an index ranging from 0 to 200 where 200 represents the highest confidence level, 0 represents the lowest, and 100, neutral. Please see the attached report Global Small Business Confidence Monitor - July 2010 for more information.
© Press Release 2011
