Issuu

SPECIAL REPORT: SPOTLIGHT ON DUBAI’S REAL ESTATE SECTOR

gulfbusiness.com / J U N E 2 0 2 2

DRIVEN BY A CLEAR VISION PROPERT Y FINDER’S SCOT T BOND SEES DUBAI LEADING THE WAY IN TERMS OF DIGITAL ADVANCEMENTS, INCLUSIVIT Y AND INVESTMENTS

P.40 COMING FULL CIRCLE: How businesses are using recycling and reuse models to drive sustainability and profits

P.66 SOARING HIGH: In an exclusive interview, Emirates’ CCO shares the airline’s roadmap to a thriving future

SCAN TO WATCH SCOTT’S OUTLOOK ON DUBAI’S THRIVING PROPERTY MARKET THROUGH A SPECIAL AUGMENTED REALITY EXPERIENCE

Giannis Antetokounmpo

Gulf Business

CONTENTS / JUNE 2022

The brief An insight into the news and trends shaping the region with perceptive commentary and analysis

26 A long-standing legacy We showcase the life and legacy of the late Sheikh Khalifa bin Zayed Al Nahyan, who played a pivotal role in transforming the UAE into a global business, education and cultural hub

44 Cover story: A promising outlook Scott Bond, UAE country manager for Property Finder, tells us how the right talent is key to a company’s success and why Dubai will continue to be popular with investors

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June 2022

CONTENTS / JUNE 2022

59 Lifestyle

Arabian Travel Market 2022: Stakeholders from the hospitality and tourism industry share the future prospects of their sectors p.60

The right time: In conversation with Franck Juhel, president of Montblanc Middle East, India and Africa p.68

“His Highness Sheikh Mohamed bin Zayed Al Nahyan carries the legacy of Sheikh Zayed. His assumption of the responsibility of the presidency represents a new historical era and a new birth” HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai

72 The SME Story Interviews with entrepreneurs and insights from experts on how the regional SME ecosytem is evolving

Editor-in-chief Obaid Humaid Al Tayer Managing partner and group editor Ian Fairservice Group director Andrew Wingrove andrew.wingrove@motivate.ae Editor Neesha Salian neesha.salian@motivate.ae Deputy editor Varun Godinho varun.godinho@motivate.ae varungodinho Tech editor Divsha Bhat divsha.bhat@motivate.ae Contributor Zainab Mansoor editorial.freelancer@motivate.ae zzainabmansoor Senior art director Olga Petroff olga.petroff@motivate.ae Art director Freddie N. Colinares freddie@motivate.ae Photographer Mark Mathew

General manager – production S Sunil Kumar Production manager Binu Purandaran Production supervisor Venita Pinto Chief commercial officer Anthony Milne anthony@motivate.ae Publisher Manish Chopra manish.chopra@motivate.ae Sales executive Sonam Sharma sonam.sharma@motivate.ae Group marketing manager Joelle AlBeaino joelle.albeaino@motivate.ae Group marketing manager Dominic Clerici dominic.clerici@motivate.ae

Cover: Freddie N. Colinares Follow us on social media: Linkedin: Gulf Business Facebook: GulfBusiness Twitter: @GulfBusiness Instagram: @GulfBusiness

HEAD OFFICE: Media One Tower, Dubai Media City, PO Box 2331, Dubai, UAE, Tel: +971 4 427 3000, Fax: +971 4 428 2260, motivate@motivate.ae DUBAI MEDIA CITY: SD 2-94, 2nd Floor, Building 2, Dubai, UAE, Tel: +971 4 390 3550, Fax: +971 4 390 4845 ABU DHABI: PO Box 43072, UAE, Tel: +971 2 677 2005, Fax: +971 2 677 0124, motivate-adh@motivate.ae LONDON: Acre House, 11/15 William Road, London NW1 3ER, UK, motivateuk@motivate.ae

June 2022

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SHEIKH KHALIFA THE LEGAC Y LIVES ON REMEMBERING THE LIFE OF THE VISIONARY LEADER

ava i l a b l e at a l l m a j o r b o o k s t o r e s a n d o n b o o k s a r a b i a . c o m

www.motivatemedia.com

MOTIVATEBOOKS

MOTIVATE_BOOKS

MOTIVATEBOOKS

People who see challenges differently, see flight differently. What the world needs now is a new generation of flight – made possible by people who bring a new perspective to the challenge. A world where air travel that connects us to more people and places can also be more sustainable and fuel-efficient. Because seeing a better-connected world isn’t something that’s far in the future. It’s the world we’re building now.

The Brief Global Finance Economy Calev’s Newsroom Future

08 10 11 12 15

POPULATION COVERAGE BY TYPE OF MOBILE NETWORK Most of the world population is covered by a mobile broadband signal, but blind spots remain 100% 80% 60%

2G 2G 3G 3G

40%

JUNE

20% 0%

2015

2016

2017

2018

2019

2020

2021

Note: The values for 2G and 3G networks show the incremental percentage of population that is not covered by a more advanced technology network Source: Measuring digital development, Facts and figures 2021

Operating at depth Effective strategies to avoid distractions and stay focused at work p.15 gulfbusiness.com

June 2022

The Brief / Global A N A LY S I S

Does your country really need digital cash? Bloomberg columnist Andy Mukherjee investigates…

ine out of 10 central banks are exploring electronic versions of physical cash, according to the Bank for International Settlements’ 2021 survey of monetary authorities released last month. Nearly everyone, it seems, is convinced that the future of money is digital. While that might be right, does every country need to be on the bandwagon just yet? Not really. Whether you’re Poland or Peru should make a big difference in deciding just how big a priority a central bank digital currency, or CBDC, should be. More advanced economies face a specific challenge: waning demand for cash. The share of banknotes in point-ofsale transactions has dwindled to 11 per cent in North America, 19 per cent in the Asia-Pacific and 27 per cent in Europe. As currency bills eventually start vanishing from circulation and into vaults, the public’s trust in the convertibility of bank deposits into official money may become “more of a theoretical construct than a daily experience,” in the words of the European Central Bank’s Ulrich Bindseil and others. That could be problematic for financial stability, especially if lightly regulated private-sector tokens like stablecoins – cryptocurrencies that promise 1:1 convertibility with dollars or other widely accepted assets – step into the breach and replace official cash. For emerging markets,

ILLUSTRATION: GETTY IMAGES/ARTPARTNER-IMAGES

MORE ADVANCED ECONOMIES FACE A SPECIFIC CHALLENGE: WANING DEMAND FOR CASH. THE SHARE OF BANKNOTES IN POINT-OF-SALE TRANSACTIONS HAS DWINDLED TO... Europe

27%

Asia-Pacific

North America

June 2022

19%

11%

gulfbusiness.com

ILLUSTRATION: GETTY IMAGES/FANATIC STUDIO

The Brief / Global

“IN RURAL AREAS, THE ROBBERY RISK ASSOCIATED WITH EXCHANGE OF PHYSICAL BILLS WILL BE REDUCED. IF ANONYMITY OF CASH IS PRESERVED, PEOPLE MAY PREFER TO TRANSACT USING CBDCS. THERE WON’T BE LONG QUEUES TO BUY PREPAID CARDS OF DIFFERENT OPERATORS” that would mean a return to “dollarisation,” and an end to decades-long efforts at establishing their own sovereign currencies. Luckily, this isn’t a universal problem yet. Cash continues to dominate the payment scene in Latin America, the Middle East and Africa, according to the FIS Worldpay Global Payments Report 2021. It’s unlikely to disappear soon even in some highly developed economies like Japan. In other words, not all central banks face the same urgency in preparing for a post-cash future by going digital. So who exactly needs a CBDC first? The contrast between Poland and Peru may help answer that question. Both are emerging markets according to MSCI Inc., though the central European nation’s per capita income of $15,000 is two-anda-half times that of the Latin American country. Both have a fairly short history of currency sovereignty. As Poland set out to rebuild its formerly command-andcontrol economy in the 1990s, foreign cash dominated the zloty 3:1 in commerce. (Up until the 1980s, authorities printed a special legal tender against dollar deposits. These “bony” notes could be used for everything from American cigarettes and Japanese cameras to clothes from Western gulfbusiness.com

Europe but had no value outside Poland.) Peru entered the new millennium with 80 per cent of bank deposits denominated in dollars. But while both Poland and Peru are counted as success stories of de-dollarisation, their retail financial landscapes look very different. Poland spent the 90s reforming its currency management, and eventually won the population’s trust in the zloty, both as a medium of exchange and as a store of value. Peru’s mountainous topography has made things more complicated. Dollar bills (and bank deposits) are still very much a part of the country’s bi-monetary system. Financial inclusion hasn’t progressed sufficiently, especially in rural areas. Almost nine in ten Polish adults have bank accounts; only a little over half of Peruvians do. The payment industry is highly competitive in Poland, with consumers enjoying a wide variety of noncash options to settle claims. BLIK, the dominant network available to nearly all mobile phone users, is more widely used in e-commerce now than cards. The pandemic also gave a push to BLIK. Embedded in the applications of multiple banks, it is witnessing growing acceptance in personto-person payments as a substitute for cash.

In Peru, where internet access in rural areas is limited, Covid-19 led to a surge in precautionary currency hoarding: Cash in circulation rose to 10 per cent of gross domestic product, from 7 per cent in 2018. Given the surfeit of choices for consumers, Polish authorities don’t see the need to add one more. “So far, no specific social purpose has been identified that the issuance of digital zloty would serve,” officials at the Polish monetary authority wrote in a paper included in a recent BIS study of attitudes to CBDCs in emerging economies. In Peru, on the other hand, acceptance of noncash instruments is patchy. Digital payments are growing. But most transfers take place in closed loops, among clients of the same financial entity. Peru hasn’t made up its mind yet about digital cash, but it’s not ruling it out either. “In the medium term, we foresee that some payment flows could be improved by introducing a domestic CBDC,” its central bank officials wrote for the BIS study. For instance, suppliers of goods to half a million mom-and-pop stores would save on cash collection costs if shopkeepers could receive and make payments in digital sol. The government’s conditional cash transfer and pension payments – as well as fees and service charges paid by the people to state agencies – won’t require an expensive visit to a bank branch. In rural areas, the robbery risk associated with exchange of physical bills will be reduced. If anonymity of cash is preserved, people may prefer to transact using CBDCs. There won’t be long queues to buy prepaid cards of different operators if the 80 per cent of Lima’s population that travels by bus could pay for the rides using CBDCs. Rural migrants working in the capital city will be able to send money home in a costefficient manner. Before committing themselves to digital cash, emerging markets need to ask themselves if they’re closer to Poland or Peru. If the private sector in their country can’t or won’t provide high-quality, interoperable payments solutions at a reasonable price to everyone, then central banks need to step in early — to both hold on to currency sovereignty and expand financial inclusion. Otherwise, they can afford to wait. June 2022

The Brief / Finance

ILLUSTRATION: GETTY IMAGES/VECTORAART

Saod Mohammed Obaidalla, EVP and head of Private Banking, Emirates NBD

The great wealth transfer

As Millennials and Gen Z begin to accumulate wealth, their investment needs are likely to transform the institutional wealth management function. Impact investing, which combines financial returns with social and environmental benefits, is seeing an upsurge in interest, with 59 per cent of the region’s family businesses ready to take the lead in sustainable business practices. Investments in emerging technologies and digital transformation and assets are also gaining traction. REGULATORY SUPPORT

With preservation and innovation as the two pillars ensuring the future of family businesses, UAE laws have kept pace to support and enhance the role of family offices in the diversification and growth of As Millennials and Gen Z increasingly take their place in the national economy. The Onshore Trust Law introduced in the boardrooms of family businesses, particularly in the 2020 puts in place frameworks for the region, it’s crucial that wealth advisory is customised organisation of family offices in the UAE for the new generation and abroad to ensure stable and sustainable asset protection and succession planning. Also in 2020, Dubai he world is currently experiencintroduced an opt-in law to regulate “AS MILLENNIALS AND GEN Z ing the “Great Wealth Transfer”, family business ownership. The BEGIN TO ACCUMULATE WEALTH, law not only underscores the during which the world’s wealthiest individuals, each with a net THEIR INVESTMENT NEEDS importance of family, enshrining worth of more than $5m, will transfer an a collaborative approach, but also ARE LIKELY TO TRANSFORM estimated $18.3tn to their children by the provides for the new generation’s THE INSTITUTIONAL WEALTH year 2030. This figure represents oneentrepreneurial vision. fourth of the global wealth of $62tn held Dispute resolution too has been MANAGEMENT FUNCTION” by high-net-worth individuals (HNWIs). in the spotlight, with Decree No. Of this, generational wealth transfer by 34 of 2021 concerning the Dubai Z investor differs from older counterparts, HNWIs in the Middle East will see 19,038 International Arbitration Centre particularly in view of findings that suggest individuals pass on $604bn to their kids. (DIAC) making significant changes to that one in five businesses have a next genThe UAE’s leadership, from the time of arbitral institutions in Dubai. Issued in eration member (aged 40 or younger) on the founding fathers, has always believed in 2022, Abu Dhabi’s new family business the board or on the management team. the potential of youth to change the world ownership governance law addresses the Millennials, for instance, are starting for the better, entrusting the young with a issue of continuity in the contribution of out with the greatest amount of formal place in the driver’s seat when it comes to the thriving sector to the economy even education of any generation in history. development. The Emirati model of youth as it facilitates a smooth transition to the Coming of age in a digital, borderless world, empowerment treats the young as the most succeeding generation. their concerns are more global than those cherished assets for ensuring creativity and Globally, family businesses and family of previous generations. In a multicultural innovation, while enshrining the positive offices remain the the largest contributors to nation such as the UAE, it is not surprising values of society. GDP, and the largest employers in the private that this generation has embraced sector. They hold the key to economic A DIFFERENT APPROACH diversity in investments, markets, and growth and wellbeing. Being attuned to The generational wealth transfer has impliin management styles. These inheritors the needs of those who will be entrusted to cations for wealth managers so that the have the potential to globalise a business; manage these businesses in future will usher great potential of this transition can be in fact, 58 per cent of Middle East family in better business practices, while delivering realised. Wealth advisors must adapt to the businesses consider expansion into new results that ensure the continued relevance many ways in which the Millennial or Gen markets a top priority. of advisory services across generations.

June 2022

gulfbusiness.com

The Brief / Economy A N A LY S I S MUSLIM CONSUMER SPEND ON PHARMACEUTICALS

Rising force

ILLUSTRATION: GETTY IMAGES/GMAST3R

The Islamic economy is seeing robust growth among different verticals, reports Zainab Mansoor

formidable group of Muslim consumers are seeking to fulfill their faith-inspired needs, driving the growth of the Islamic economy. Several key factors are rallying its growth, such as growing engagement and product diversification, a burgeoning Muslim consumer base and a number of strategies dedicated to halal product and service development. Numbers back the optimism: The world’s 1.9 billion Muslims spent $2tn in 2021 across the food, pharmaceutical, cosmetics, fashion, travel, and media/recreation sectors, according to the State of the Global Islamic Economy 2022 report, produced by DinarStandard and supported by Dubai Economy and Tourism. The total spending signalled an 8.9 per cent year-on-year growth from the previous year.

“Growing consumer demand for diversity and inclusivity in cosmetics propelled halal cosmetic players. Muslims spent a total of $70bn on cosmetics in 2021, which is anticipated to increase to $93bn in 2025” gulfbusiness.com

$100

$106

$129

2021

2022

2025

BILLION

Muslim spend on food increased by 6.9 per cent to equal $1.27tn in 2021, and is forecast to reach $1.67tn by 2025. Also, Muslim spend on travel was valued at $102bn in 2021 and is anticipated to reach $189bn by 2025, the report added. Muslim-friendly hotels and restaurants are also expected to record growth in the coming years. Indicating notable investment activity, HalalBooking.com secured $5m in preSeries B funding, while Pakistani travel startup FindMyAdventure raised $600,000. Meanwhile, Muslim consumers spent $100bn on pharmaceuticals last year, which is expected to scale to $106bn this year and total $129bn in 2025. As much as $2bn in halal-related pharmaceutical investments were made in 2020/21. Abu Dhabibased ADQ acquired Egypt’s Amoun Pharmaceutical Company, while Malaysia’s MiCare received $30m in funding from the International Finance Corporation. Simultaneously, Muslim spend on fashion totalled $295bn in 2021, and is forecast to rise to $313bn in 2022, the report added. While modest fashion was garnering traction even prior to the Covid-19 pandemic, the key shift has been into e-commerce. Among notable collaborations, Malaysian brands Mimpikita and CalaQisya partnered with Disney for their modest wear collections. Growing consumer demand for diversity and inclusivity in cosmetics propelled halal cosmetic players. Muslims spent a total of $70bn on cosmetics in 2021, which is anticipated to increase to $93bn in 2025, the study added. Muslim spend on media and recreation also increased by 7.2 per cent in 2021 to equal $231bn. New mobile apps such as ImamConnect and Sango sprung up to cater to Muslim lifestyles, while digital advancements in the regional art scene were also witnessed. Last year, UAE-based Behnood Javaherpour launched the country’s first NFT (nonfungible token) digital Islamic art agency. However, Islamic finance was estimated to value $3.6tn in 2021 and is forecast to reach $4.9tn by 2025, the report added. Global sukuk issuance escalated to $250bn in 2021, according to the Institute of International Finance. Meanwhile, Nasdaq Dubai recorded $11.9bn in new sukuk listings last year. With Muslim spend forecast to reach $2.8tn by 2025, growth across the Islamic economy space appears promising. June 2022

The Brief / Calev’s Newsroom

Calev’s Newsroom Calev Ben-David, anchor of the nightly news programme, The Rundown, on i24NEWS

Building bridges

ILLUSTRATION: GETTY IMAGES/MESUT UGURLU

The highlight of the relationship between Israel and the UAE is not its economic or political aspects, but rather the human side

June 2022

srael’s first prime minister, David Ben-Gurion, famously remarked: “If you don’t believe in miracles, you’re not a realist.’’ Certainly Ben-Gurion’s personal odyssey – from arriving as a Polish-Jewish immigrant in the Middle East backwaters of the Ottoman Empire, to being the founding father of the first Jewish state in 2,000 years – provided plenty of justification for that belief. So was his claim that Israel would one day establish peaceful relations with its Arab neighbours, a vision he never lived to see. The Camp David Accords, the peace treaty with Jordan, and especially the Abraham Accords that established full relations between Israel and the UAE and Bahrain (later adding Morocco and Sudan), only provides more evidence to the far-seeing nature of Ben-Gurion’s vision. But if the Abraham Accords had a touch of the miraculous to them due to the seeming suddenness of their announcement and speed with which they have been fulfilled, seasoned Middle East observers may view the new ties between Israel and the UAE as a natural, if not pre-ordained, affinity. Like Israel, the creation and rise of the UAE appears to defy realistic expectations. That seven emirates under British colonial rule could unite politically under the visionary leadership of the late Sheikh Zayed bin Sultan Al Nahyan, the UAE’s founding father, and within decades diversify its economy to become a global trading, tourism and technology powerhouse, is a trajectory well beyond the normative paths of nation-building. One could draw all sorts of parallels with Israel’s surge of development in recent years; indeed, another famed Ben-Gurion maxim – “If we do not conquer the desert, it will conquer us” – appears to apply equally, if not even more so, to the Emirati experience. Of course, the establishment and strengthening of ties between Israel and the UAE has been supercharged by several factors, including geo-political shifts and economic cooperation. In 2021, the first full year after the Abraham Accords, trade between Israel and the UAE surged to an astonishing $900m. With the establishment of a free trade agreement between the countries this year that covers 95 per cent of the products traded between them, that figure is expected to more than double by the end of 2022. As a journalist for i24NEWS, I’ve had the privilege of both covering that unprecedented business story, and being part of it. Moving quickly on the announcement of the Abraham Accords, i24NEWS became the first Israel-based media outlet to sign cooperation agreements with leading companies gulfbusiness.com

The Brief / Calev’s Newsroom

“WITH THE ESTABLISHMENT OF A FREE-TRADE AGREEMENT BETWEEN THE COUNTRIES THIS YEAR THAT COVERS 95 PER CENT OF THE PRODUCTS TRADED BETWEEN THEM, THAT FIGURE IS EXPECTED TO MORE THAN DOUBLE BY THE END OF 2022” in Dubai’s media sector, including Dubai Media Inc (DMI), Dubai Media City, Abu Dhabi Media, Etisalat, DU and Motivate Media Group. Along with opening an i24NEWS bureau in Dubai, this has enabled our journalists to cover the developing business and financial ties between Israel and the Gulf. In future columns, I look forward to focusing more specifically on some of the more fascinating and promising angles of that story. But the real headline of the fast-developing relationship between Israel and the UAE has not been its primarily economic or political aspects – it is the human side. The eagerness I have found

gulfbusiness.com

THE FIRST FULL YEAR AFTER THE ABRAHAM ACCORDS, TRADE BETWEEN ISRAEL AND THE UAE SURGED TO AN ASTONISHING

$900M

among Israelis and Emiratis to build new bridges of all kind between their societies, has been expressed with an enthusiasm that has caught even this veteran Mideast reporter by surprise. This is especially so among the younger generation of Israelis and Emiratis, who via social media and now personal contacts, are already outpacing their elders in forging ahead to create new modes of coexistence and cooperation for this region, moving beyond the outmoded paradigms that for so many decades had frozen Israel-Arab ties in a fruitless stasis. This then, is the true promise of the Abraham Accords, beyond its purely economic or diplomatic potentialities. A new generation of Israelis and Emiratis are forging pathways toward a new Middle East, one that can hopefully help light the way toward the resolution of conflicts that have for too long held back this entire region. And this time, it won’t take a miracle – just a belief, and acceptance, of a new reality already in the throes of creation.

June 2022

The Brief / Alan’s Corner

Alan’s Corner Alan O’Neill, author, keynote speaker and owner of Kara, specialists in culture and strategy

Leveraging employee engagement surveys Surveys are a key tool for feedback and send a positive message to employees that their opinions are valued

ngagement surveys serve a purpose for organisations to gauge the ‘temperature’ or the mood of teams. The core of this concept is that when your people are engaged with your company, they will be more productive, team morale will be higher, staff turnover and absenteeism will be lower and they’ll give better experiences to your customers. Ultimately all of that improves your culture and affects your financial results. With Covid-19 still in our recent memory, now is a good time to check your organisation’s temperature.

HOW TO CONDUCT THESE SURVEYS There are lots of technology companies offering this service with all sorts of bells, whistles and coloured charts. The platform for doing the survey is the easy part, so don’t be blinded by that. There are other more fundamental considerations to ponder. Consider why you are doing a survey. Be clear on your purpose. Are you doing this to simply check the temperature, or do you want to use the results to make real changes? You need to be honest with your team. Don’t embark on this if you don’t plan to act on the results, whatever they might be. Otherwise cynicism will grow in your team and you won’t get buy-in for subsequent resurveys. Ask the right questions. As tempting as it might be, don’t download a set of generic questions from Google. Your questions should be structured in a psychological flow and be relevant to your company, your culture and what you are trying to 14

June 2022

achieve. You should also ask for appropriate verbatim comments to help you make sense of the numerical scores. They add meat to the bones. I also favour a mix of emotionalthemed questions (For e.g., “I enjoy coming to work”) and practical questions (For e.g., “Is workload distribution fair”). The feedback on the practical questions in particular help to make improvements later. That gives you “cause and effect” insights. Because confidentiality must be assured, make it anonymous. Even if you believe you have an open culture where people speak their minds already, well executed surveys always produce extra nuggets of unknown information. You have to reassure your respondents that their anonymity is guaranteed. That’s almost impossible if you administer it yourself internally. Communicate well to ensure a high level of participation. To maximise participation rates, communicate clearly how the survey will work, reassure the team on confidentiality and be clear on the purpose. If the communication is sent by the CEO or other senior person, it will have even more impact.

Allocate time during work hours for participants to complete the survey. This is a work-related matter so you want respondents to reflect carefully on the answers. Doing it on a train or at home risks too many distractions. If you are a company where not everyone has a desk, then allocate a dedicated room for the exercise, with PCs set up and agreed time slots. Turn data into insights. Creating spreadsheets and coloured charts of the results is easy. Turning that data into bigger picture insights requires an objective and trained eye. Agree on corrective actions. When the results are in, present highlights to the whole organisation. They deserve to hear the results. Then convene a steering team to guide the corrective actions that are reasonable and fair. Work with managers to execute the actions. If your team is big enough to slice and dice your results per department, then make the department head accountable for working with her/his team to agree local actions. Inaction will lead to cynicism. Resurvey in an appropriate timeframe. At the very least, make this an annual occurrence. And whatever the scores are in the first survey, they give you a line in the sand. I’m always interested in the resurvey results to see how the scores have moved. In most cases where actions have been executed, the scores will increase and morale will improve. THE LAST WORD Over the years, I’ve had some senior managers pushing back on the notion of doing surveys, as they believe they already know how their people feel. They say they have an open-door policy and therefore believe they are closely in touch with the mood already. But surveys go deeper than anecdotal conversations and day-to-day chatter. In every one of those cases, the managers were surprised with the results. Others fear that there will be negativity about the results, cringing at the fear of opening a can of worms. But if the worms are there, isn’t it better know about them? If you don’t deal with them, what impact will that have on your business? Remember, your customers are good at judging how engaged your employees are. gulfbusiness.com

The Brief / Future COMMENT

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Rehan Khan, principal consultant for BT and a novelist

Operating at depth Easily distracted at work? Here are effective suggestions to successfully maintain your focus when tackling cognitively demanding tasks

veryone’s role will entail some level of cognitively demanding work, or ‘deep work’ as some writers refer to it. This might be 90 per cent of the role, if your job is to create intellectual capital, or it might be 10 per cent, if you are sitting in a contact centre receiving inbound voice calls from customers. For me, cognitively demanding work entails: writing or researching and thinking about a business problem, writing a paper, crunching through a financial model. When I am doing any of these tasks, I need to metaphorically hold my breath and dive deep like a traditional pearl diver, for I know it’s only when I get to a certain level of cognitive depth, that I will discover the jewels I’m searching for. At this deep depth, I can make the connections which I couldn’t discern whilst swaying about in the shallows. For others cognitively demanding work may include: writing a human resources policy, preparing a strategy presentation, architecting a complex project plan. Depending on the nature of your job, this will vary. gulfbusiness.com

The point here is that when you are in this mode, you want to avoid distractions at all costs. It takes about 25 minutes to return to the same level of cognitive depth you were at, before you got distracted. As a professional in a highly competitive world, you simply cannot afford to waste time being distracted by the frivolous and trivial. Here are some broad suggestions about how to avoid becoming distracted when you need to undertake cognitively demanding work: Do not disturb. Depending on the working culture within your organisation and the level of acceptance to this, try and activate “do not disturb” for periods of time. You can do this by either moving into an empty meeting room and putting up a sign, switching your messaging application to this mode, making your online presence offline. If you have an open plan office, then make an agreement with your colleagues, and when they see a sign on your desk indicating that you should not be disturbed, then you should not be. This signal could be a small lamp which you switch on when you do not want to be disturbed, or a sign which you hang up.

I would suggest you try with small bite sizes of “do not disturb time” first, try 30 minutes. See how you fare, and you can build it up from there to whatever the needs of your work are. You will be surprised how much you can get done when your mind is free from incoming messages and notifications. Block incoming notifications. If you find it difficult to restrain yourself from checking your social media and email, then take the decision out of your hands and install an app which blocks all websites for a period of time. This way, even if you have the urge to check you cannot. Closing down the Wi-Fi on your computer or unplugging it from the Ethernet cable will also have the same result. If you take your laptop with you to a coffee shop or another location where you need to get deep work done, ask yourself whether you really need to be online. Cancel the noise. The trend to open plan offices over the past two decades has resulted in a cacophony of noise reverberating around offices. It’s easier to concentrate when the background noise all melds into one, but if we start to pick up distinct conversations then we become distracted. In such a situation, investing in noise-cancelling headphones will help, or if you do not want to pay for that outlay, then simply use some ear buds to block out the noise. Work remotely. Prior to the Covid-19 pandemic many employers were neutral to unsupportive about their employees being out of the office. They wanted facetime, to see their staff sitting at the desk. However post-Covid the culture has changed. If you are able, take yourself out of the office for periods of time, into a coffee shop or another location, where you will not be disturbed and you can dive into the work. One significant benefit I have had from removing distraction when I have cognitively demanding work, is that I can maintain my energy levels for much longer. I feel less drained, because I am not spending time jumping around from one thing to the next, with cortisol and adrenaline firing off. The quality of our work is dependent on how much we concentrate and for how long we can concentrate. June 2022

The Brief / Regulatory frameworks COMMENT

Siddharth Behal, partner - Governance, Risk and Compliance, KPMG Lower Gulf

Why internal controls are critical for organisations

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Companies should not wait for regulators to fix gaps, they would do well to proactively establish a strict internal control framework

obust internal controls form the foundation of good governance in an organisation. Within environmental, social and governance (ESG) frameworks, the governance pillar relates to how businesses are administered, including risk, oversight and ethics. Unfortunately,

June 2022

this is overlooked by many organisations. The systems and processes designed to support effective business outcomes and ensure operational efficiency and compliance are either ineffective, overlooked or simply not up-to-date. This could negatively impact business processes in an organisation. As the 14th century nursery rhyme and proverb ‘For want of a nail’ illustrates, you are only as strong as your weakest link. The failure to correct a minor issue can snowball into an issue of great magnitude. Therefore, organisations must evaluate internal controls as fundamental to enhance trust in business and improve reporting quality. There are a plethora of companies with internal controls across various levels – from processes to anti-fraud and IT general controls. These processes are surrounded by transactions and material reporting gaps. There are also growing pressures on management to meet the increasing expectations of stakeholders. In all this clutter, internal controls are often overlooked to focus on more pressing issues and bigger problems, including upcoming mergers and acquisitions, the latest expansion plan, new product launches, or mitigating new challenges as a result of unforeseen events like Covid-19. But adopting this stance can be catastrophic for companies. Robust internal controls can help gain insight into potential fraud risks and evaluate if gulfbusiness.com

The Brief / Regulatory Frameworks

the established controls that prevent and recognise fraudulent behaviour are still in place and are operating effectively. IDENTIFYING INTERNAL CONTROL VULNERABILITIES

If internal control vulnerabilities are allowed to linger, they can slowly multiply and spread, and may spiral completely out of hand. An easy recovery may become either a massive financial charge or a cover up, and instead of things getting better, they could grind to a sudden halt. Common areas where missing internal controls are identified in companies in the region include: Revenue recognition of delayed invoicing, resulting in under recognition of revenue Revenue recognition of the over estimation of percentage completion, resulting in excess recognition of revenue Poor controls over cut-off procedures Lack of robust financial close processes Under accruals of expenses and liabilities Lack of documented policies, procedures and delegation of authority Absence of a robust legal compliance framework and fraud risk management Poor controls over bank reconciliations, vendor reconciliations and inter-company reconciliations Absence of checks on segregation of duties In the last two years alone, companies had to adapt to Covid-19 with remote working, which brought its own set of challenges to systems and processes. The

“MANY CEOs, CFOs AND BOARD MEMBERS BELIEVE THEY SHOULD SPEND THEIR TIME RESOLVING URGENT MATTERS AND LEAVE INTERNAL CONTROLS WITH JUNIOR MANAGEMENT OR INDIVIDUAL EMPLOYEES. HOWEVER, IT HAS BEEN PROVEN THAT THE TONE AT THE TOP IS THE OVERARCHING FACTOR THAT DETERMINES WHETHER THE COMPANY CONTINUES TO GROW” gulfbusiness.com

THE TONE AT THE TOP THE OVERARCHING FACTOR THAT DETERMINES WHETHER THE COMPANY CONTINUES TO GROW

wide-scale shift to remote work rapidly increased organisations’ vulnerability to cyberattacks. Cryptocurrencies are also exploding into the mainstream along with climate change, ESG policies and decarbonisation. Companies in the region, which were just getting accustomed to VAT will soon need to also adapt to corporate taxes and the new global minimum tax regime. Therefore, it is critical to ensure that processes and controls are robust enough to navigate these changes without losing momentum along the way. A TOP-DOWN APPROACH

Many CEOs, CFOs and board members believe they should spend their time resolving urgent matters and leave internal controls with junior management or individual employees. However, it has been proven that the tone at the top is the overarching factor that determines whether the company continues to grow. Regulators’ investigations into failures at companies such as Enron, Worldcom, Xerox, Barings, and Satyam always come back with the same recommendations to make it mandatory for companies to establish proper internal controls and make boards, management and auditors responsible for testing these controls every year. The Abu Dhabi Accountability Authority (ADAA), Insurance Authority (IA) and Securities and Commodities Authority (SCA) have also made it compulsory for companies in the UAE under their remit to move in this direction. Organisations should not wait for regulators to fix gaps. They would do well to instead proactively establish a strict internal control framework. They must consider what are the significant risks and assess how they have been identified, evaluated and managed. They must identify any significant failings or weaknesses that have been reported and consider whether necessary actions are being taken promptly to address significant failings or weaknesses. Finally, they must consider the need for more extensive monitoring of internal control systems. June 2022

The Brief / Food Science COMMENT

Clement Maclou, senior thematic portfiolio manager, ODDO BHF Group

Food for thought

ILLUSTRATION: GETTY IMAGES/VALENTINA KRUCHININA

We look at why lab-grown ingredients could be the future of food, with scientists and entrepreneurs looking at ways to reduce the environmental impacts of factory farming and animal agriculture

he UN food commodities price index rose the most in February since 1961 after an already staggering 23.1 per cent rise in 2021, putting the most vulnerable populations at risk. The gauge that tracks the price of meat, dairy, cereals, oils and sugar is impacted by the crisis in Ukraine and sanctions on Russia on top of the existing Covid-related factors such as supply chain disruptions, logistic strains and pent-up demand. One of the long-term impacts will be an acceleration of the adoption of new technologies as they help to increase the yields while reducing the impact on the environment. Lab-grown food

June 2022

LAB-GROWN MEAT IS PRODUCED BY IN VITRO CELL CULTURE OF CONVENTIONAL ANIMAL CELLS

is also a clear beneficiary, as the price parity with conventional agricultural products will be easier to meet in an inflationary environment. LAB-GROWN FOOD: FROM FICTION TO REALITY

Lab-grown meat is produced by in-vitro cell culture of conventional animal cells. While the first tasting of a burger is not yet 10 years old, the idea and science behind cellular agriculture is not new. In his 1931 essay Fifty Years Hence, Winston Churchill wrote: “We shall escape the absurdity of growing a whole chicken to eat the breast or wing, by growing these parts separately under a suitable medium.” gulfbusiness.com

The Brief / Food Science

99% In 2008, PETA, the American animal rights organisation, offered a $1m prize to the first company to bring cultured chicken meat to consumers by 2012. Many searchers worked on it, but the deadline eventually expired without a winner. However, awareness was ignited. Just a year later, Mark Post, professor of tissue engineering at Maastricht University in the Netherlands, created the first cultured beef burger patty. It was made from over 20,000 thin strands of muscle tissue, cost over $300,000 and needed two years to produce. The burger was tested on live television in 2013 and the food critic who sampled it said: “There is quite some flavour with the browning…it’s close to meat, it’s not that juicy, but the consistency is perfect. This is meat to me...” The market debut really started in 2020 with the first sale of cultivated meat in Singapore. Twentythree startups were created in just the year 2020, representing more than $350m of investment, nearly doubling all the cumulative previous investments, according to the Good Food Institute. WHY IS IT THE FUTURE OF FOOD?

A study conducted by Post, who made people test the products, revealed that the vast majority of people are ready to buy them even at a premium of 40 per cent compared to traditional meat. However, the ultimate goal is to get taste and price parity. Regarding the taste, we have unfortunately not yet been able to try the products. When it comes to pricing, the Israeli company Future Meat Technologies announced

LESS LAND

96%

LESS FRESHWATER

80%

LESS GREENHOUSE GAS EMISSIONS

$300,000+ COST OF FIRST CULTURED BEEF BURGER PATTY

TWO YEARS

TO PRODUCE

20,000+ THIN STRANDS OF MUSCLE TISSUE

“IN THE FUTURE, LAB-GROWN MEAT COULD BECOME AN ACCESSIBLE AND CHEAP PROTEIN SOURCE, AND COULD BE USED TO ADDRESS FOOD SECURITY ISSUES AND FOOD SHORTAGES”

gulfbusiness.com

DELIVERING THE SAME NUTRITIONAL VALUE AS TRADITIONAL MEAT

in December 2021 a cost for a chicken filet of $17 per kilo compared to an average price of $8 per kilo for farmed chicken. In order to reach parity, price would need to go down by more 50 per cent to include all the other relevant costs, such as packaging and transportation. The number one reason why people are ready to buy it at a premium and why the world needs labgrown food is the environmental footprint of this new technology. According to Future Meat Tech, this production method leads to yields 10 times higher than the industry standard while generating 80 per cent less greenhouse gas emissions, using 99 per cent less land and 96 per cent less freshwater all while delivering the same nutritional value as traditional meat. Another favourable argument for lab grown is the fact that is it much less exposed to contamination and the resulting diseases such as African swine flu. The number two reason is obviously animal welfare. By removing animals from the food value chain, the need for intensive agricultural practices, battery farms and slaughterhouses disappears together with animal suffering. According to the FAO, it is estimated that more than 70 billion land animals are killed annually for human consumption. By taking animals out of the food process, issues related to animal welfare like mistreatment, poor living conditions and disease outbreaks could be avoided. In the future, lab-grown meat could become an accessible and cheap protein source, and even be used to address food security issues and food shortages that have been recently exacerbated by the Covid-19 pandemic and crisis in Ukraine. We are still a long shot from seeing lab-grown food in our supermarkets. Governments would need to authorise the commercialisation of such products and industry specialists anticipate that it could be this year in the US and Israel. June 2022

The Brief / Strategy Lovrenc Kessler, managing partner, Simon-Kucher & Partners

ILLUSTRATION: GETTY IMAGES/NUTHAWUT SOMSUK

COMMENT

Managing strategic price increases

Increasing prices in an already inflation-ridden economic climate requires thoughtful strategic reasoning and execution

ith prices for raw materials, energy and shipping still increasing and amid ongoing uncertainty about when they will stabilise, there is no better time for companies to consider strategic price increases. Their goal is not only to minimise margin erosion, but also to ensure sufficient funds to re-invest into the company for future development, to enable employee growth, and to support causes. 20

June 2022

THE CHALLENGE: Increasing prices in an already inflation-ridden economic climate requires thoughtful strategic reasoning and execution. While UAE inflation rates (2.5 per cent in 2021) are below global levels, we have still seen an increase of 458 basis points (bp) over the last year: competition and consumers alike are sure to act and react. Companies need to define a suitable strategy to capture incremental willingness to pay without alienating consumers. Where to start? An effective price increase strategy revolves around three key questions that companies should consider: WHAT IS THE STRATEGIC RATIONALE BEHIND THE PRICE INCREASE?

Analysing and defining the goal of your price increasing measure is paramount to its success. Companies need to: Align prices to willingness-to-pay: Implement a pure price increase across the portfolio (with no incremental value) to correct for systematic undercharging. React to competition: Create an appropriate competitive gap that aligns to relative price positioning in the market. This may include following competition or maintaining a favourable competitive position. Charge for added consumer value: Ensure that gulfbusiness.com

The Brief / Strategy

innovations in the product or service roadmap are properly captured in the portfolio and any new value provided is properly monetised. Pass costs through: Determine whether it’s necessary to pass through some or all of the costs to the consumer. Differentiate product roles: Ensure companies are taking a segmented approach to price increases and maintaining core strategy (For e.g., land and expand or traffic-driving versus margin-building) for their entire portfolio of products and services.

WHILE UAE INFLATION RATES (2.5 PER CENT IN 2021) ARE BELOW GLOBAL LEVELS, WE HAVE STILL SEEN AN INCREASE OF

OVER THE LAST YEAR

increases across consumers and to quantify the net impact to their business. HOW SHOULD I COMMUNICATE THE PRICE INCREASE TO MY EXISTING CONSUMERS?

Defining a strategic price increase approach can be challenging and requires significant preparation. In certain situations, price increases may not need to be communicated to existing customers. Key components for communicating your price increases should include the following: Determine the optimal communication channels: Decide whether it is push (e-mail or app notification) or pull (via the website, blog posts). Highlight the rationale and context for your price increase: Do so by linking it clearly to the benefits consumers will receive from the incremental value added to products and services or investments in innovation. Be transparent, but minimise the magnitude: Choose to communicate either the total price increase or the percentage, whichever creates less friction. Give advance notice: Also, grant a grace period if relevant (typically applies to subscriptions/ recurring purchases)

HOW MUCH SHOULD I INCREASE PRICES?

Another important decision to consider for a strategic price increase approach is the height of increase. It is often most effective to keep your prices just below consumers’ psychological thresholds. There tends to be minimal elasticity when price increases do not cross these key thresholds, which enables many companies to maximise revenue and profit with minimal impact to volume. The strength of these key price points are company and strategy related. The magnitude of the price increase is best determined in one of two ways: Less frequent but larger price increases: This scenario works best for companies that do not make revolutionary changes but collect a lot of small improvements to their offering over time. This is also a good option if the operational complexity of implementing a price increase is prohibitive. In this situation, it is best to shift prices to the next level. Frequent but smaller price increases: This scenario is effective for companies that are continuously rolling out new features, benefits, products, and services that provide value to consumers. In this situation, smaller price increases work best. A good rule of thumb is to raise prices by roughly 10 per cent. In both cases, it’s important to estimate the potential churn or backlash to the desired price increases. We recommend conducting a market survey to understand the acceptability of price

458 bp

A GOOD RULE OF THUMB IS TO RAISE PRICES BY ROUGHLY 10 PER CENT

KEYS TO A SUCCESSFUL PRICE INCREASE STRATEGY

Many factors should be considered to implement a successful price increase strategy. Considering three core questions will help you to define a suitable strategic approach. Keeping in mind how much you charge – and how you communicate it – are both equally important for successful price increases. And once you determine your process, your optimised pricing will enable you to cushion the inflationary shock most effectively.

“ANOTHER IMPORTANT DECISION TO CONSIDER FOR A STRATEGIC PRICE INCREASE APPROACH IS THE HEIGHT OF INCREASE. IT IS OFTEN MOST EFFECTIVE TO KEEP YOUR PRICES JUST BELOW CONSUMERS’ PSYCHOLOGICAL THRESHOLDS. THERE TENDS TO BE MINIMAL ELASTICITY WHEN PRICE INCREASES DO NOT CROSS THESE KEY THRESHOLDS, WHICH ENABLES MANY COMPANIES TO MAXIMISE REVENUE AND PROFIT WITH MINIMAL IMPACT TO VOLUME” gulfbusiness.com

June 2022

The Brief / Infographics UAE SMART STRATEGIES

On the rise

The Middle East, Africa and South Asia (MEASA) region is emerging as a significant e-commerce market, backed by several factors such as high smartphone penetration, social media usage and a tech-savvy population 70% 60%

TOP 10

59%

MEASA COUNTRIES

by internet shoppers per internet user, 2019

50%

•

41%

40%

31%

30%

31%

27%

• 25%

23%

• •

20% 10%

•

0% United Arab Emirates

Qatar

Saudi Arabia

Turkey

TOP FUTURE TRENDS BUILDING MOMENTUM E-COMMERCE PLATFORM • Social commerce • Voice shopping • Augmented and virtual reality

Oman

Libya

Kuwait

Iraq

• •

Morocco

DUBAI BLOCKCHAIN STRATEGY UAE STRATEGY FOR THE FUTURE UAE AI STRATEGY 2031 NATIONAL CYBERSECURITY STRATEGY UAE 4TH INDUSTRIAL REVOLUTION STRATEGY DUBAI 10X PROJECT NATIONAL FOOD STRATEGY 2051

MEASA E-COMMERCE GROWTH DRIVERS Moderate

High (Positive signal)

LOGISTICS / DISTRIBUTION Delivery automation

CUSTOMER ENGAGEMENT • Robots for customer service • Environmentally conscious shoppers • New payment options • Retail technology disruption

DRIVERS

MIDDLE EAST GCC, Levant and others

Low (Negative signal)

AFRICA North Africa and Sub-Saharan Africa

SOUTH ASIA

E-commerce growth

High

Moderate

High Internet penetration

High

Moderate

Smartphone and social media adoption

High

Moderate

Affluent, young, and tech-savvy population

High

Government policy and support

Moderate

Low

Moderate

Cross-border e-commerce

High

Ease of doing business

High

Moderate

ALL DATA NORMALISED TO A SCALE OF 0 TO 100, WITH 100 BEING THE BEST SCORE

June 2022

gulfbusiness.com

SOCIAL MEDIA PENETRATION

E-COMMERCE GROWTH SALES GROWTH 2019-2022 40.5%

PAKISTAN

39.3%

SAUDI ARABIA UNITED ARAB EMIRATES

38.3% 36.6%

KENYA

33%

SRI LANKA

27.6%

EGYPT

99%

Kuwait

99%

UAE

99%

Qatar

84%

Bahrain

72%

Saudi Arabia

49%

Morocco

29%

India

27.2%

BAHRAIN

25.7%

NIGERIA

24.3%

OMAN

20.1%

TURKEY

17.7%

JORDAN

MEASA E-COMMERCE GROWTH AND SHARE

17.1%

MOROCCO

$3.6 trillion

GLOBAL AVERAGE 16.6%

2022 (f)

MEASA RETAIL SALES

GLOBAL E-COMMERCE SALES

MEASA E-COMMERCE SALES

4% GROWTH CAGR

$3.2 trillion

2019

MEASA RETAIL SALES

$3.6

$5.7

trillion (f)

trillion

16.6% CAGR

$89.4 billion

$148.5 trillion (f)

18.4% CAGR

$148.5 billion

2022 (f)

MEASA E-COMMERCE SALES

2019

2022

2019

2022 18.4% GROWTH CAGR

$89.4 billion

The Gulf region saw a 214% year-on-year increase in cross-border online sales mid-year 2020”

$30.3

billion

E-commerce sales 2022 for GCC (f) (f)=forecasted

gulfbusiness.com

BUY NOW

2019

MEASA E-COMMERCE SALES

DIGITAL PAYMENT (Credit card penetration) Percentage of adults 15+ that possess credit cards

45% UAE

Egypt

42%

16%

Turkey India

[18% WORLD]

Saudi Arabia

Nigeria

Kenya

0.2%

Morocco

SOURCE: MEASA E-COMMERCE LANDSCAPE REPORT

June 2022

The Brief / Lightbox

Demonstrators hold signs during a rally held outside the US Capitol to demand the Senate take action on gun safety on May 26, in the wake of the shooting that took place at the Robb Elementary School in Texas, on May 24. The gunman, 18-year-old Salvador Ramos, fatally shot 19 students and two teachers 24

June 2022

gulfbusiness.com

June 2022

PHOTO: TOM WILLIAMS/CQ-ROLL CALL, INC VIA GETTY IMAGES

FEATURES / IN MEMORIAM

The legacy continues… A TRIBUTE TO THE VISIONARY LEADERSHIP AND MERITORIOUS LIFE OF THE LATE SHEIKH KHALIFA BIN ZAYED AL NAHYAN WORDS: ZUBINA AHMED

pioneer, renowned statesman and visionary, UAE’s late former President Sheikh Khalifa bin Zayed Al Nahyan will be remembered for his contributions to the country’s successful economic diversification and global standing. The nation achieved several important milestones during his presidency, including the Projects of the 50, Abraham Accords, the Hope Probe reaching Mars, the ‘golden visa’ initiative, hosting Expo 2020 Dubai, winning the bid to host the 28th Conference of the Parties (COP28), tackling the Covid-19 pandemic successfully and the launch of Barakah Nuclear Energy Plant, the UAE’s first nuclear power station.

June 2022

TOUCHING TRIBUTES Widely loved and respected, his demise on May 13, 2022, left the country and the world in a state of mourning. He died at the age of 73 and was laid to rest at the Al Bateen Cemetery in Abu Dhabi. Tributes poured in from across the world as regional and global leaders offered their condolences. Among them, Saudi Arabia’s King Salman bin Abdulaziz Al Saud held a funeral prayer performed in absentia at the Grand Holy Mosque and Prophet’s Mosque. Queen Elizabeth II, the UK’s current and longest-reigning monarch, said she was saddened to hear about Sheikh

Khalifa’s death, who “devoted his life to serving the people of the UAE and his relationship with its allies and friends”. President of the US, Joe Biden, took to social media to hail the late leader as a true partner. While others, such as King Abdullah of Jordan, US Vice President Kamala Harris, UK Prime Minister Boris Johnson, Prince William - Duke of Cambridge, and French President Emmanuel Macron, travelled to the UAE to pay their respects.

POLITICAL CAREER Sheikh Khalifa, born in 1948, was deeply inspired by his father, Sheikh Zayed bin Sultan Al Nahyan, the founding father of the UAE. In 1966, at the age of 18, Sheikh Khalifa was appointed as the Representative of the Eastern Region when Sheikh Zayed became Ruler of Abu Dhabi, consequently moving to Abu Dhabi city. In 1969, he was appointed as Abu Dhabi’s Crown Prince. In 1971, following the foundation of the UAE, he was appointed as the Deputy Prime Minister in the first federal cabinet. In 1974, the local cabinet of Abu Dhabi was replaced by the Executive Council as the key entity for the local government, and Sheikh Khalifa was named its first President. In 1976, he was promoted to Deputy Supreme Commander of the UAE Armed Forces and tasked with overseeing military training and equipment. In the late 1980s, Sheikh Khalifa became Chairman of the Supreme Petroleum Council. On November 2, 2004 when Sheikh Zayed passed away, Sheikh Khalifa gulfbusiness.com

FEATURES / IN MEMORIAM

gulfbusiness.com

June 2022

FEATURES / IN MEMORIAM

succeeded him as Abu Dhabi’s ruler. Soon after, the Federal Supreme Council elected him as the President of the UAE for a term of five years and in 2009, he was re-elected.

KEY MILESTONES Sheikh Khalifa introduced several initiatives and legislations that enabled the nation’s rapid socio-economic development. Education, healthcare and women’s empowerment were important areas of focus for him. He was instrumental in the creation of Abu Dhabi Fund for Development, Abu Dhabi Investment Authority, Khalifa Housing Fund, Khalifa Fund for Enterprise Development, Abu Dhabi Department of Social Services and Commercial Buildings, Khalifa Bin Zayed Al Nahyan Foundation and the Khalifa Award for Education. He also set up the Environmental Research and Wildlife Development Agency (ERWDA) in 1996 to boost environmental protection in the UAE. In 2005, ERWDA became known as the Environment Agency Abu Dhabi (EAD). In 2020, he issued the Decree of Federal Law No. 06, stipulating equal wages for women and men in the private sector. In the same year, he officially abolished a previous law, the Federal Law No. 15 of 1972, which boycotted Israel.

SHEIKH KHALIFA’S BROTHER, HIS HIGHNESS SHEIKH MOHAMED BIN ZAYED AL NAHYAN, PRESIDENT OF THE UAE AND RULER OF ABU DHABI, WILL NOW CARRY HIS VISION FORWARD In 2021, under his presidentship, the Federal Authority for Identity, Citizenship, Customs and Ports Security was formed by merging three government entities, including the Federal Authority for Identity and Citizenship,

the Federal Customs Authority, and the General Authority of Ports, Borders and Free Zones Security. Last year, Sheikh Khalifa approved a wideranging reform of the country’s legal system. Over 40 laws were included in the changes, which together represent the largest legal reform in the nation’s 50-year history. These and other path-breaking initiatives introduced during his time will continue to drive the UAE forward, as it implements its ambitious Centennial 2071 Plan.

A NEW CHAPTER Sheikh Khalifa’s vision will now be carried forward by his brother, HH Sheikh Mohamed bin Zayed Al Nahyan, who was named as Ruler of Abu Dhabi, and unanimously elected as the President of the UAE by the Federal Supreme Council on May 14, marking yet another defining moment for the nation. 28

June 2022

gulfbusiness.com

CONGRATULATIONS TO THE WINNERS LIFETIME ACHIEVEMENT AWARD NASSER AL NOWAIS

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Presented by

FEATURES / AVEVA PI WORLD

AVEVA PI WORLD AMSTERDAM 2022 SHOWCASED HOW LEADERS IN THE INDUSTRY ARE LEVERAGING DATA TO SPARK INNOVATION AND ESTABLISH NEW STANDARDS OF AGILITY AND RESILIENCE IN AN ERA OF RAPID CHANGE

UNL OCK ING T HE VA L UE OF INDUSTRIAL DATA

WO R D S : D I V S H A B H AT

June 2022

gulfbusiness.com

FEATURES / AVEVA PI WORLD

lobally, the Covid-19 pandemic has led to a profound shift in how organisations develop, invest and deploy technologies to meet their net-zero climate commitments. Companies must consume less energy and use it more efficiently to reduce carbon emissions. Although this sounds easy, we all know it’s difficult, especially if there is incorrect or insufficient data. Today’s digital technologies, data and artificial intelligence have the power to accelerate businesses’ sustainability transformation. Aveva has played a central role in helping companies develop energy-related roadmaps and solutions that reduce greenhouse gas emissions while still meeting the world’s energy demands. “The technology sector presents opportunities because we can deploy at scale and connect different companies and different operations through data, which then opens up new insights that can be used to solve sustainability challenges. For example, to address the current climate crisis, we must implement technology that we already have while also innovating to develop new solutions to help reach the internationally agreed goals,” says Lisa Wee, vice president – Sustainability at Aveva.

Aveva PI World

At the recently held Aveva PI World Amsterdam 2022 event, the company demonstrated how contextualised data is an essential component to sustainable growth in sectors such as power, manufacturing, and infrastructure. Focusing on primarily creating a space for customers and partners to share how they are transforming their organisations and industries, the four-day event, which took place from May 16-19, 2022, delivered an overview of the new developments and solutions. Furthermore, the learning labs offered hands-on Peter Herweck technical practise in cloud and data environments. In the keynote speech, Peter Herweck, chief executive officer of Aveva, discussed how the company’s

gulfbusiness.com

information-led innovation provides a proven and flexible path to industrial growth at a critical time when the business landscape has been reshaped by turbulence and risk. “Industries are facing complex challenges in a turbulent market environment. Business leaders face increased sustainability compliance requirements, retiring workforces, and the ever-present demand for efficiency, agility and resilience. Raw data in itself is not immediately useful or even understandable, but when you analyse and contextualise it into insightful information, that’s when you can help the industrial world to innovate at scale on the road to a net-zero future,” he said. According to the International Energy Agency (IEA), industries have committed to dramatically reducing emissions in the next 25 years. With digitalisation driving sustainability, Aveva aims to help accelerate the organisations to reach their goals. “We spark industrial ingenuity by connecting people with trusted information and insights and also help drive responsible use of the world’s resources,” he added.

Fostering sustainable use of data

The event also witnessed Amish Sabharwal, executive vice president of Engineering at Aveva and Gregg Le Blanc, senior vice president of Information Management at Aveva, outline the company’s integrated portfolio and elaborate on the product roadmap for 2022 and beyond. Le Blanc pointed out that 50 per cent of data was created in the last two years and how this will continue even in 2024. Meanwhile, according to the Seagate Rethink Data Gregg Le Blanc Survey – IDC, 2020, while 56 per cent of data is captured through operations, 68 per cent of data goes unleveraged. With half a century of experience and over 20,000 customers, Aveva believes it is uniquely placed to deliver a complete digital thread purpose built for the industry. “Industrial companies struggle to share timely, accurate data across their global ecosystem. And organisations that share data externally with its partners generate 3X more measurable economic benefit than June 2022

FEATURES / AVEVA PI WORLD

those that do not,” said Le Blanc. “We launched Aveva Data Hub earlier this year, a software-as-a-service offering that enables businesses to gain operational efficiencies, boost sustainability and drive digital transformation with data sharing capabilities. Data is the accelerator of the connected economy, and our open and agnostic solutions leverage customers’ existing investments and enable a connected community across the ecosystem.”

Driving digital transformation

With digital twins gaining momentum currently, thanks to rapidly evolving simulation and modelling capabilities, better interoperability and IoT sensors, and more available tools and computing infrastructure, Gartner predicts that the digital twin market will cross the chasm in 2026 to reach $183bn in revenue by 2031. For clarity, a digital twin is a virtual presentation of an object or system that serves as the real-time digital counterpart of a Amish Sabharwal physical object or a process. “Digital twin recreates a physical asset in digital form by capturing, organising and contextualising data in a quantifiable form. When these models are used to forecast future scenarios, they can predict potential problems, improve asset reliability, reduce costs and resource use, and minimise carbon emissions,” commented Sabharwal. During the event, Aveva announced that its engineering information management solutions, the core of its digital twin, now deliver more significant time and value gains for capital projects and operations. In addition, its customers can now experience a complete digital twin within just 60 days, even in the absence of existing models. Through two new partnerships, Aveva’s engineering information management solutions are now integrated with Assai’s integrated document management system, 32

June 2022

GARTNER PREDICTS THAT THE DIGITAL TWIN MARKET WILL CROSS THE CHASM IN 2026 TO REACH

$183bn IN REVENUE IN 2031 and data is captured by NavVis’ wearable mobile mapping systems. As a result, laser scans can be delivered much faster than the existing stationary scanners. “Digital twins have never been more important. They will play a central role in uncovering opportunities to unlock ingenuity and achieve the efficiency and sustainability gains needed to enable net-zero carbon emissions,” added Sabharwal.

Customer success stories

With over 2,500 delegates joining the event in person and online, more than 70 companies in 12 industry verticals shared their experience of the data-led digital transformation. The guest speaker at the event, Dr Catherine Green, associate professor at the Wellcome Centre for Human Genetics at Oxford University, explained how data helped develop the Oxford vaccine. She said: “Despite lockdowns and remote working, we were able to develop and bring to market the OxfordAstraZeneca vaccine in eight months as compared to eight years before the outbreak of Covid-19, thanks to improved data collection, advanced analytics and Dr Catherine Green distributed trials and manufacturing. “We are at the transition point where you can bring new tech to old problems. And data is going to change everything that we do here. It’s going to change our ability to analyse the problem, deliver the solution, and communicate with the healthcare sector and with the public.” gulfbusiness.com

FEATURES / AVEVA PI WORLD

Industries are facing complex challenges in a turbulent market environment. Business leaders face increased sustainability compliance requirements, retiring workforces, and the ever-present demand for efficiency, agility and resilience” Michael Dean, global director of Kellogg’s Power, looking at sustainability for a long time, and earlier, we Controls and Information System, explained how the lacked real-time data and insight on how to improve opercompany’s platform investment had yielded benefits in ational efficiency. Our partnership with Aveva helped terms of scale, consistency, standardisation and collabodeploy the right tools, which increased the visibility and ration. “Kellogg’s has 50 manufacturing sites worldwide, real-time information to help operators make the right and installing Aveva PI System has helped leverage, decisions. As a result, we reduced electricity use by 25 per analyse and manage energy data in its factories, crecent, and also we cut overall carbon emission by 25 per ating a digital ecosystem that benchmarked usage and cent,” she said. identified opportunities for savings,” observed Dean. During the discussion, Dean stated the explicit goals of “As a result, we saved $3.3m in a single year, identified Kellogg’s for 2030 and 2050. “We look at how to manuan additional $1.8m in rebates and optimised facture products more sustainably. For instance, abatement measures.” we leveraged the Aveva PI System, which signifiJan Broekman, vice president of Global cantly reduced our energy consumption.” Engineering and Smart Modularisation, at Jacky Wright, the chief digital officer at MicroMcDermott, also offered insight into how digital soft, who joined the panel virtually, shared how solutions integrated multiple inputs to build a data accelerates sustainability progress. “A sustainable capital project, including real-time cloud-based, data-driven approach enabled us to commodity prices and low-carbon design. assess, select and build new technologies, and Additionally, the event featured an interesting Jan Broekman reduce our scope 1, scope 2, and, ultimately, panel discussion on digital agility and resiliency. scope 3 emissions across our business.” Sophie Borgne, senior vice president – Digital Power Line She further explained how data analytics has supof Business at Schneider Electric, explained how they ported smart buildings, investment in renewable energy have cut carbon emissions by 25 per cent. “We have been to power data centres, and driven strategic decisions to pay for the removal of 1.3 million metric tonnes of carbon dioxide from the atmosphere.

What’s next

Aveva envisions optimising the entire industrial ecosystem, connecting people with industrial intelligent-as-aservice. “We apply the advanced, proven technologies to drive our customer’s success and enable them to Andrew McCloskey achieve more. Going forward, we are building blocks for the Aveva industrial metaverse using Aveva XR to solve many different customers use cases in operations engineering,” said Andrew McCloskey, CTO and EVP – R&D in the closing note. gulfbusiness.com

June 2022

FEATURES / CLIMATE CHANGE

RISING CHALLENGES CLIMATE DISRUPTION IS GROWING, WITH RECENT WATER-RELATED DISASTERS, SUCH AS STORMS, FLOODING AND DROUGHT, FORCING 2.6 MILLION PEOPLE FROM THEIR HOMES

June 2022

ast year brought new records for sea-level rise, ocean temperature, greenhouse gas concentrations and ocean acidification, according to a new UN World Meteorological Organization (WMO) climate report card. The climate crisis is getting worse, and UN Secretary General Antonio Guterres marked the report’s release by calling on rich countries to share the intellectual property for energy technologies that can accelerate the badly-needed transition away from fossil fuels. Guterres admonished countries to fast-track infrastructure build-out and eliminate bureaucracy that stands in the way. Batteries and related power-storage technology should be treated as “freely available public goods,” he said. He also singled out fossil fuel subsidies, that “every minute of every day” grant $11m to coal, oil and gas companies. Guterres called it “a dismal litany of humanity’s failure to tackle climate disruption.”

gulfbusiness.com

FEATURES / CLIMATE CHANGE

We will see many more millions of climate refugees as severe weather events increase in frequency and severity, and with sea level rising every year we will see more and more coastal regions being overcome”

Critical assessments

The report adds detail to the three major assessments published by the UN’s climate-science panel in recent months. The global sea level has risen by an average of 4.5 millimetres a year for 2013-2021, driven mostly by melting ice sheets. Differences in temperature and salinity affect local rates, so the oceans rise at different speeds. Scientists have observed accelerated rise in the western North Pacific, southwestern Pacific, South Atlantic and southwestern Indian oceans. Carbon dioxide concentrations peak every year at this time, as Northern Hemisphere vegetation draws down the most important warming gas. CO₂, methane and nitrous oxide are up 149 per cent, 262 per cent and 123 per cent over their pre-industrial levels. Six independently maintained temperature data sets found 2021 to be 1.1° Celsius higher than the second half of the 19th century. A La Niña, or temporary cooling pattern in the Pacific, left last year in the top five to seven hottest years on record. The rising ocean temperature –“which is irreversible on centennial to millennial timescales,” the WMO writes – led 2021 to beat the previous record, set in 2020, for the top two kilometers of water. It’s not only heat that’s a problem. Oceans absorb about 23 per cent of the CO₂ that people emit. That keeps temperatures rising as fast as they otherwise would, but also changes marine chemistry in a way gulfbusiness.com

4.5

millimetres a year Global sea level average rise between 2013-2021

23%

CO2 absorbed by the oceans that people emit

that may prove challenging to many ecosystems. Ozone holes are growing again as climate change exacerbates stratospheric cold spells. Water-related disasters, including storms, flooding and drought, forced 2.6 million people from their homes in just three countries: China, Vietnam and the Philippines.

What’s next

Shaun Fitzgerald, director of Cambridge’s Centre for Climate Repair, “We will see many more millions of climate refugees as severe weather events increase in frequency and severity, and with sea level rising every year we will see more and more coastal regions being overcome.” Guterres’ remarks unified the WMO’s science – and risk-focused report with policy initiatives that he hopes countries will take on. Public and private renewable-power investments need to triple to at least $4tn a year, Guterres said, noting the up-front funding nature that solar and wind power require. By 2024, he said, development banks and financial institutions should end financing to high-emissions activities. (Bloomberg) June 2022

FEATURES / SOIL PRESERVATION

MAN ON A

MISSION

SOIL CONSERVATION AND RESTORATION IS KEY TO THE SURVIVAL OF OUR SPECIES, SAYS INDIAN ENVIRONMENTALIST AND SPIRITUAL LEADER SADHGURU JAGGI VASUDEV, WHO RECENTLY VISITED THE UAE TO RAISE AWARENESS ABOUT HIS SAVE SOIL CAMPAIGN

WORDS: NEESHA SALIAN

June 2022

gulfbusiness.com

FEATURES / SOIL PRESERVATION

A teaspoon of topsoil contains around one billion individual microscopic cells and around 10,000 different species”

rom undertaking a 100day lone motorcycle ride across 27 countries, including the UAE, to clocking in 30,000 kilometres and interacting with government leaders, speaking at the COP15 summit in Cote d’Ivoire and engaging with communities along the way, 65-year-old Indian mystic, spiritual leader and environmentalist Sadhguru Jaggi Vasudev has chosen an unusual way to drive home the urgency of initiating government action and global awareness to alleviate the global threat of soil degradation. This crisis, Sadhguru emphasises, can no longer be ignored, as “time is running out”. A new report from the United Nations Convention to Combat Desertification (UNCCD) reveals that the way land resources – soil, water and biodiversity – are currently mismanaged and misused threatens the health and continued survival of many species on Earth, including our own. The report showed that up to 40 gulfbusiness.com

per cent of the planet’s land is degraded, which directly affects half of humanity and threatens roughly half of the global GDP ($44tn). It also stated: “Conserving, restoring, and using our land resources sustainably is a global imperative, one that requires action on a crisis footing…Business as usual is not a viable pathway for our continued survival and prosperity.”

Tackling climate change

Soil, in particular, plays a critical role in promoting the survival of our species; it’s also an important weapon in our fight against climate change, largely due to the microbes that help make soil a living ‘entity’. According to the UK Centre for Ecology and Hydrology (CEH), a teaspoon of topsoil contains around one billion individual microscopic cells and around 10,000 different species.

2050 BY 2050, THE WORLD WILL HAVE TO FEED OVER NINE BILLION PEOPLE, WITH THE DEMAND FOR FOOD BEING 60 PER CENT GREATER THAN IT IS TODAY

FOOD DEMAND

2022

These microbes are vital to crop fertility. They help detoxify the environment from pollutants, regulate carbon storage stocks and production/consumption of many significant greenhouse gases, such as methane and nitrous oxides. Soil, particularly agricultural soil, has the potential to sequester, relatively inexpensively, 250 million metric tonnes of carbon dioxide-equivalent greenhouse gases annually – equivalent to the annual emissions of 64 coal fired power plants, according to the US-based National Academy of Science. However, this precious resource is perishing very rapidly due to intensive farming methods and natural processes that are not only killing the insect biomass, but also making it difficult to grow crops, which should raise alarm bells with food security being a cause for major concern. According to a World Economic Forum report, by 2050, the world will have to feed over nine billion people, with the demand for food being 60 per cent greater than it is today. Thus without changing agricultural practices and finding ways to preserve soil, the global food supply may be compromised in the coming decades. Timely action – within the next 15 to 25 years – can help turn the situation around, says Sadhguru. Any later than that can have a disastrous impact. The key to preserving soil is ensuring the organic content in it is between 3 to 6 per cent. However, with more than 27,000 species of micro-organisms going extinct every year, it’s going to get increasingly difficult to revive or produce soil. June 2022

FEATURES / SOIL PRESERVATION

In the UAE, the International Center for Biosaline Agriculture signed a memorandum of understanding (MoU) with Conscious Planet to work together to protect food-producing agricultural soil in the country from degradation” To put things in perspective, it can take up to 1,000 years to produce just 2-3 centimetres of soil, according to the United Nations Food and Agriculture Organisation.

Preserving soil

Offering a solution to enable change in time, Sadhguru has outlined a threepronged strategy to raise the organic content of soil. These include providing farmers with incentives for reaching this target, simplifying the process by which farmers can take advantage of carbon credits, and developing a special label for foods grown from soil with the target levels of organic content and health benefits of these foods. Taking this message to the masses (Sadhguru’s

goal: 3.5 million people) and engaging governments to introduce supportive policies – through the Conscious Planet initiative and Save Soil global campaign – has been a driving force for Sadhguru, who kicked off his solo motorbike journey in London this March. The buy-in has been very encouraging. In the UAE, the International Center for Biosaline Agriculture signed a memorandum of understanding (MoU) with Conscious Planet to work together to protect food-producing agricultural soil in the country from degradation. Seven Caribbean nations, Azerbaijan and Romania also signed MoUs with Conscious Planet to implement policies that contribute to soil preservation, while the Commonwealth of Nations, European

Union and several pan-European organisations have shown their support. The French government’s ‘4 per thousand’ initiative, which aims to address climate change and increase food security through soil regeneration, has also signed an MoU with Save Soil. Additionally, organisations such as the International Union for Conservation of Nature, UNCCD, World Food Programme and United Nations Environment Programme have partnered with the movement. Change is never easy, but with the support of these organisations and millions of people, Save Soil’s goals are a step closer. On our part, we need to be conscious of our deep connection to the soil and respect the crucial role it plays in our lives. Let’s make it happen.

IN CONVERSATION SADHGURU JAGGI VASUDEV SPOKE TO GULF BUSINESS DURING HIS RECENT VISIT TO THE UAE. HE SHARED HIS VIEWS ON… The UAE’s evolution The most striking thing about the UAE is its transformation from a remote desert habitation to a global hub in a span of just 50 years. It takes vision and resilience of commitment. And while it’s easy to have a vision, seeing it through and dedicating a lifetime to it is an incredible feat, and I commend the leadership of this country for it. I’ve also been speaking to the country’s present leaders and they have a clear strategy in place to boost the country’s

June 2022

economy over the next 50 years. Other nations should be inspired to plot their growth and tackle challenges with a similar approach. I think the UAE is one of the few countries to think so far ahead. On underestimating our power to enable change When we say we are “only human”, we focus on our incapacities. In terms of evolution, there are trillions of species on the planet and we head that list. We shouldn’t wait for

people [teachers, mentors, gurus or politicians] to empower us, we have to take the initiative to see the immense potential each one of us possesses. It’s time to acknowledge our “humanness” with pride. How businesses and individuals can be more socially and environmentally conscious Awareness is the key; solutions always follow when we get more conscious about things.

Action can only be initiated when businesses and people believe in what they are supporting. My organisation and I have spent three decades researching and creating a strategy to raise awareness and suggest solutions on a global platform. Businesses and individuals can help by raising the pitch of my work, and taking it forward. They have the right talent and resources to be heard and make a difference. However, all this can only work when action is taken based on a good strategy and plan – dealing with issues using an ad hoc approach will not result in lasting change.

gulfbusiness.com

CMY

FEATURES / RETAIL

SCALING A CIRCULAR ECONOMY BUSINESS MODELS CHAMPIONING A CIRCULAR ECONOMY OFFER A COMPETITIVE EDGE WHILE PROMOTING SUSTAINABILITY AND CONSCIOUS CONSUMERISM. WE LOOK AT SOME OF THE COMPANIES IN THE UAE THAT HAVE ADOPTED THESE MODELS WORDS: ZUBINA AHMED

June 2022

ake, use and dispose. Traditionally, this has been the standard approach to consumption and production. We always think of our next big purchase, but also forget our previous ones. Have you ever wondered where they go? What if every material could be used to make a new product? According to a recently published World Economic Forum report, the world produces over two billion tonnes of solid waste, and that’s expected to grow to 3.4 billion tonnes by 2050 and about one-third of that waste is not managed properly. By volume, global waste includes 44 per cent food and organics, 17 per cent paper and 12 per cent plastic – all valuable commodities. With increasing awareness of the importance of waste, the circular economy has gained ground. Sustainable production and consumption practices are rapidly becoming a driving force. Essentially, it eliminates waste by applying three basic principles: reduce, reuse and recycle. In 2021, the UAE cabinet approved the UAE Circular Economy Policy – a comprehensive framework to ensure quality of life for current and future generations. This includes supporting the

private sector in adopting clean methods that spur green development. By adopting these strategies, the UAE is looking forward to having both imported and locally manufactured products that are efficiently designed, manufactured, repaired, reused, remanufactured and recycled. Selling all used products on the secondhand market is another good solution. In turn, this will help create a circular economy by increasing sustainability and reducing the carbon footprint. There are a number of local companies across different sectors that are addressing the issue with this vision.

Pre-owned fashion market At this juncture, consumers, investors and other stakeholders of fashion retail seem to be at the forefront of increased consumption. Industry practices that are detrimental to sustainability, purpose, ethics and overall operations are being questioned. A number of alternative business models are taking shape in the wake of this movement towards conscious consumerism, among which is the pre-owned fashion market. Now estimated to be a multi-billion-dollar arm of the fashion industry, the second-hand luxury market witnessed a huge surge of 18 per cent from $36.1 bn in 2020 to $37.3 bn last gulfbusiness.com

FEATURES / RETAIL

year, according to Statista. It’s expected to increase twofold by 2026 to an estimated global value of $77bn. This market continues to champion sustainable shopping by offering dedicated pre-loved goods sites. Kunal Kapoor founded The Luxury Closet in Dubai in 2012 as an online store for pre-owned luxury fashion items. Kapoor was born into an entrepreneurial family and worked for luxury brand Louis Vuitton before founding his own business. “All disruptive The Luxury Closet’s Kunal Kapoor ideas come from sparkling “I really think it is the right thing to trends. Circular economy is a do for consumers to not buy new prodtransition where resources are not ‘used ucts continuously but buy pre-owned up’ but are used again and again. The ones. People can exchange things, they core idea was to solve the sustainability can re-sell them, but not discard them. issue and the democratising of luxury,” The next organic step is that the share of says Kapoor. the pre-owned market will go up, but it Consumer patterns are shifting will all become circular and the brands towards a more conscious and sustainwill become part of this. Look at the able approach to fashion. Pre-owned car industry – they manufacture a car items are driving the fashion moveknowing it will have multiple owners. ment while offering buyers access to real The brands design the car around that, luxury, which was previously unreachknowing that the warranty will need able for certain customers due to price to be transferred and people will buy or availability constraints. “Resale is the and resell it. In fashion, the brands will future of shopping. We expect one in six become the major contributors and transactions to be pre-owned by the end enable the pre-owned and circular econof the decade. This marks a paradigm omy,” elaborates Kapoor. shift in consumer choice and the value As announced in the Circular chain of the fashion and retail industry. Economy Action Plan, the EU ComWhat we are excited about most is leadmission recently proposed new rules to ing the industry to a more sustainable make almost all physical goods on the and environmentally friendly future,” EU market friendlier to the environstates Kapoor. ment, circular, and energy efficient throughout their whole lifecycle from the design phase through to daily use, repurposing and endof-life. The Commission also presented a new strategy to make textiles more durable, repairable, reusable and recyclable, to tackle the demons of fast fashion, textile waste and the destruction of unsold textiles, and to ensure production takes place with full respect given to social rights. “It just so happened that we stumbled upon something gulfbusiness.com

that has really become something of a trend now. With early signs of regulation coming in, industry players are going to be forced to become a lot more sustainable. There is also an adoption curve of green energy in resale of luxury items. Japan has been leading for the last 20 years, followed by the US. I would say it will take another five to seven years for the Middle East to catch up,” concludes Kapoor.

Tackling food wastage According to the Dubai Carbon Centre of Excellence, food wastage in the UAE is estimated to be 3.2 million tonnes, with around 38 per cent of the food prepared daily being wasted, most of which comes directly from home. This number rises to 60 per cent during Ramadan. Leading supermarket chain Spinneys has become the first retailer to partner with the ‘Food for Life’ programme, a UAE initiative to drive nationwide transformation towards healthier diets from sustainable food systems. “We have joined a global coalition of food producers, manufacturers, and retailers to work together to halve food waste across the value chain by 2030. Through this, we are working with local suppliers to identify opportunities to reduce waste, whether through donations, knowledge-sharing or innovating new products and ways of extracting value from wasted food,” says Sophie Corcut, Spinneys brand and sustainability manager. Through such partnerships, Spinneys aims to raise awareness of the issue of household food waste in the UAE with its customers, to provide practical tips on how to store food and make the most of food waste at homes. “We see waste as a flaw in the system. Our long-term goal is to design out waste in our food system, for the benefit of society, and the environment and for the long-term economic success of Spinneys and our partners,” adds Corcut. “Taking packaging, for example, we want to transition packaging design for a circular economy, applying the 4Rs of circular design (remove, reduce, reuse, recycle) and ensuring we choose materials based on the entire lifecycle of product and considering local behaviours and waste management infrastructure,” reiterates Corcut. June 2022

FEATURES / RETAIL

TO INCENTIVISE ‘REUSE’ BEHAVIOUR, WE’VE BEEN REWARDING CUSTOMERS WHO BRING THEIR OWN CONTAINERS TO STORE BY GIVING THEM A DIRHAM OFF THEIR TOTAL BILL AS A ‘THANK YOU’ FROM SPINNEYS FOR HELPING TO REDUCE WASTE”

To start the circular journey, Spinneys has also tied up with PepsiCo and DGrad to introduce a reverse vending machine at its first sustainable concept store in Dubai’s Layan community, which enables customers to recycle their PET bottles in return for prizes and rewards. For single-use plastic bottles collected from the Layan store, DGrade will create sustainable clothing from its Greenspun yarn. “We want to offer our customers choice, whilst knowing we have a responsibility to take a more active role in educating and encouraging behaviour change,” states Corcut. In their sustainable concept store, Spinneys has implemented ‘The Refill Stop’. “This holds our largest range of refillable food and household products to date, including a retail firstin-the-region free filtered water refill station. To incentivise reuse behaviour, we’ve been rewarding customers who bring their own containers to store by giving them a dirham off their total bill as a ‘thank you’ from Spinneys for helping to reduce waste,” concludes Corcut.

Pre-owned electronics market Electronic waste or e-waste is currently the world’s fastest-growing waste 42

June 2022

stream and projected to increase by 30 per cent by 2030, according to a report by Statista. All of us own multiple gadgets, most of which are unused, gathering dust at the back of our drawers. Our dependency on these devices has contributed to a global consumer electronics market worth an estimated $1tn, with that figure rapidly increasing. Applying the basic principles of a circular economy to the electronics industry is NorthLadder, a UAE-based digital platform that connects customers looking to sell pre-owned electronics to a global network of buyers. The company trades second-hand electronics such as smartphones, laptops and tablets, guaranteeing the most competitive price with no hidden charges.

“Our unique tech platform has enabled sellers to be connected directly to buyers, thus disintermediating the supply chain and giving customers the highest price in the market for their used devices. We have partnerships with the region’s electronics retailers, telcos, and distributors to enable the tradein of devices. The devices we procure are bought by our dealer network who sell them to end customers, effectively increasing the lifespan of the device and promoting the circular economy model,” says Sandeep Shetty, co-founder and CEO of NorthLadder. NorthLadder’s platform is auctiondriven, on average offering the end consumer with up to 60 per cent more value for their second-hand device. “Circular economy ensures sustainable growth over time. With this, we can drive the optimisation of resources, reduce the consumption of raw materials, and recover waste by recycling or giving it a second life as a new product,” adds Shetty. Since its launch, NorthLadder has served over 30,000 customers. It has more than 200 trade-in locations and over 500 dealers across three countries. Like any transformation, the shift from a linear to a circular economy is a highly complex task. “Every device that is traded in, is a device that ends up in another customer’s hands and not a landfill, thus promoting both sustainability and circular economy. To that extent, our core business model promotes sustainability and a circular economy, while creating tremendous value for all stakeholders,” concludes Shetty.

Circular climate goals On a broader scale, circular economy models offer a clear pathway to achieving our collective climate goals, tackling emissions tied to extraction, processing, manufacturing and landfilling of goods. In doing so, these business models create economic value, building local resilience and spurring innovation. Companies championing circular business models are gaining traction rapidly. A systematic change to a circular economy requires collaboration and partnership. It’s about time, we made a collective decision to enhance sustainability and shift the economy towards adopting greener practices. gulfbusiness.com

S P E C I A L R E P O RT

REAL ESTATE: SPOTLIGHT ON DUBAI

Cover Story

June 2022

gulfbusiness.com

Special Report / Cover Story

PLACING THE

FOR AN EXECUTIVE TO SHARE HIS VISION for a company two months in (the company and the city), may be nothing short of a tall ask. But for Scott Bond – the newly hired country manager for Dubai-based real estate portal Property Finder – it seemed refreshingly easy. His vision, however, is crisp, measurable and future-ready. It’s understandable why. Bond comes with a resounding sales background, having been a sales leader for the better part of two decades. “My whole career has been [spent] leading sales teams. In 2016, I joined the US-based real estate portal Zillow Group as a general manager leading the in-house sales team and was subsequently asked to take on a bigger role, managing two regions henceforth. Two years in, I was asked to build a sales team for a programme ‘Zillow Offers’ from the ground up. In a couple of years, we had a 400person crew, operating from six offices across the country. We were buying and selling homes across 25 markets,” reminisces Bond. The decision to move halfway across the world to join Property Finder in becoming a pure-play, customer-centric firm was largely a reflective one. “The reason I chose this job was because I saw [in Property Finder] a company that felt like Zillow, a company that was on the cusp of massive growth. And with the journey I’ve been through, I felt like I could add a bit of value to it,” states Bond.

RIGHT BETS PROPERTY FINDER’S SCOTT BOND ENVISIONS DUBAI TO LEAD

On the horizon

From traditionally conducted transactions to proptech tools, strategic initiatives and sustainable choices, the real estate sector has come a long way, effectively changing the way properties are constructed, managed and sold. And with Dubai as a cynosure of digital technologies and urban development, evolution is expected to be the only constant across the emirate’s real estate space. “There is so much opportunity to expand here in Dubai and the UAE, especially when you consider the population growth potential over the next 10 years. Dubai offers so many unique communities – from sustainable spaces to

THE WAY IN TERMS OF DIGITAL ADVANCEMENTS, INCLUSIVITY AND INVESTMENTS. HERE’S WHY… WORDS: ZAINAB MANSOOR

gulfbusiness.com

June 2022

Special Report / Cover Story

waterfront communities to remote ones. More so, we’re going to continue to see this evolution of communities that fit lifestyles, a phenomenon that is going to attract even more people into the market.” In 2021, the Dubai 2040 Urban Master Plan was launched – the seventh of its kind developed for the emirate since 1960 – offering a plethora of lifestyle and investment opportunities to citizens, residents and visitors over the next 20 years. The emirate’s population grew from 40,000 in 1960 to a whopping 3.3 million by the end of 2020, while its urban and built area increased 170-fold from 3.2 sq km in the same period. Moving forward, the number of Dubai residents is expected to increase to 5.8 million by 2040, while the daytime population is set to surge from 4.5 million in 2020 to 7.8 million in 2040. Given its growth potential, Bond says the emirate, and the country as a whole, fits the bill for long-term investments too. “We are seeing a return on investment of 5-10 per cent. We may see a slight correction in the future but as a whole, if you’re in it for the long haul, then it is an absolutely amazing place to be putting your assets into.” However, with technological advancements driving the growth of nearly all industries, future developments across the real estate landscape are also contingent on various initiatives, which would enrich the consumer journey and subsequently propel investments. Though in its infancy, real 46

June 2022

Dubai is such a digital-forward market. And that is one of the things that’s been really exciting. As property prices continue to rise, it creates opportunities for partial ownership for people who perhaps couldn’t have realised full home ownership” estate crowdfunding is encouraging people from across several stripes to pour money, bringing into the fold those who cannot afford full property ownership as well as those that are looking to plow funds into multiple properties. “Dubai is such a digital-forward market. And that is one of the things that’s been really exciting. As property prices continue to rise, it creates opportunities for partial ownership for people who perhaps couldn’t have realised full home ownership. That encourages us to think how we can provide tools gulfbusiness.com

Special Report / Cover Story

People first

IN 2021, DUBAI RECORDED THE HIGHEST VALUE OF REAL ESTATE SALES TRANSACTIONS IN 12 YEARS, WITH

DHS151.07BN WORTH OF PROPERTIES SOLD THROUGHOUT THE YEAR

for people to be able to buy or transact in a way that wasn’t possible before,” adds Bond. However, amidst all evolving trends and solutions, information remains key, the importance of which cannot be understated. Buyers are more educated and aware of their priorities and are making informed decisions based on data. Bond adds, “We want to continue to invest to enrich the consumer journey for those wanting to buy a home. We want more transparency and information for them to be able to understand key elements such as buying power, purchase prices, community trends, growth potential, developers, types of projects, etc. Buying a house is probably the largest purchase for most people, and we want to ensure that customers experience the ease of the transaction, not the anxiety of it.” Earlier this year, Property Finder acquired proptech firm, Homevalue, to improve its analytical capabilities. Homevalue, which built an artificial intelligence-led solution for the entire value chain of residential real estate, from developers and lenders to consultants, brokers, investors and asset management companies, complemented Property Finder’s existing inhouse data solutions arm, Data Finder. gulfbusiness.com

However, the ultimate success for any company or brand is choosing resources that share a singular vision. As would be with any executive harbouring a long-term vision, it boils down to hiring the right people for Bond. “Everything for me starts with talent. If you have the right people in the right places, with the correct momentum and mission, we will grow at the rates we want. “I see this as a three-pronged approach, but one that starts with talent. Then, it’s about having a consumer-first mindset on how we ultimately help customers buy or rent a home. Another huge element is making sure that we provide value and high-quality products for our brokers who are ultimately our paying customers. Of course, it is also about constant adaptation – the market is always changing. What customers want today is definitely not what they wanted half a decade earlier. More so, consumers want the processes to move faster than ever. They want information and transparency.” Consumers also lay at the nucleus of Bond’s advice to entrepreneurs seeking to enter the property/proptech space. “My one advice to entrepreneurs would be to listen to the consumer, because they would always lead you to the next trend, to where the opportunity is. The trends that we are seeing are not new issues manifesting, but those that are now starting to get solved.”

Beckoning the future

In 2021, Dubai recorded the highest value of real estate sales transactions in 12 years, with Dhs151.07bn worth of properties sold throughout the year. The number of real estate sales transactions that took place last year – equalling 61,241 – were also the highest since 2013, according to Property Finder’s data. Dubai hosted the six-month long expo event that also appeared to have an impact on the emirate’s real estate market. Since its start on October 1 until the end of last year, a total of 17,942 real estate sales transactions worth Dhs46.75bn were recorded across the emirate. With the ongoing momentum, Bond feels that this year will triumph last year’s exploits in the property space. “If we look at the growth chart right now, from mortgage origination and volumes to the rental and transaction spaces during the first four months of the year, we are seeing that 2022 will be another record year. Every element is looking to eclipse 2021 at this current pace. Dubai is a consumer-, resident- and businessfriendly city and as a result, it will continue to receive attention from investors.” Two months into his journey, functioning in the midst of an inviting ecosystem and helming a team that pulls in the same direction, what does Bond aspire to achieve? “My aim is to create a platform where everybody begins and ends their real estate journey – a place where people would go to, to ultimately find a home.” But it all begins with the right people. “The best talent ultimately creates the best company, and that will help create the most enriching consumer journey,” adds Bond. June 2022

THE OFFICIAL SALES PRICE INDEX FOR THE EMIRATE OF DUBAI

Mo’asher: Sales JANUARY 2021 - APRIL 2022

INDEX NUMBER

DUBAI OVERALL INDEX

KEY FINDINGS • Q1 2022 recorded a total of 20,539 sales transactions worth Dhs55.51bn

Index value Dhs1,016,208

APRIL SALES TRANSACTION VOLUME INCREASED BY

• March was the highest month in the past seven years in terms of sales transactions totalling 8,399

AND THE VALUE INCREASED BY 66.62% YEAR-ON-YEAR

0.8 0.6 0.4

INDEX BASE: JANUARY 2012

0.2

Apr 2022

Feb 2022

Mar 2022

Jan 2022

Oct 2021

Nov 2021

Aug 2021

Sep 2021

Jul 2021

Jun 2021

Dec 2021

Apr 2022

Feb 2022

Mar 2022

Index value Dhs2,124,828

Jan 2022

Dec 2021

Oct 2021

Nov 2021

Dec 2020

Apr 2022

Feb 2022

Mar 2022

Dec 2021

Jan 2022

Oct 2021

Nov 2021

Aug 2021

Sep 2021

Jul 2021

Jun 2021

Apr 2021

0 Mar 2021

0 Jan 2021

0.4 0.2

Feb 2021

0.4 0.2

Aug 2021

0.6

Index value Dhs1,990,495

Sep 2021

0.6

Jul 2021

1 0.8

Jun 2021

1 0.8

May 2021

1.2

Apr 2021

1.2

Index value Dhs1,822,342

Mar 2021

Index value Dhs1,678,567

Feb 2021

Index value Dhs1,140,201

Jan 2021

Index value Dhs1,000,253

1.4

Dec 2020

May 2021

DUBAI VILLAS/TOWNHOUSES INDEX

1.4

June 2022

Apr 2021

Mar 2021

Feb 2021

Jan 2021

Dec 2020

Index value Dhs904,920

May 2021

SOURCE: PROPRIETARY PROPERTY FINDER DEMAND DATA, JANUARY 2021 TO APRIL 2022

Index value Dhs1,238,401

1.2

DUBAI APARTMENTS INDEX

Index value Dhs952,825

Index value Dhs1,115,937

1.4

45.48%

• April 2022 witnessed the highest number of sales transactions in the same period over the past decade, with 6,983 sales transactions worth Dhs18.2bn

Index value Dhs1,009,593

gulfbusiness.com

THE OFFICIAL RENTAL PRICE INDEX FOR THE EMIRATE OF DUBAI

Mo’asher: Rental JANUARY DECEMBER 2021 2020 - APRIL - JANUARY 2022 2022

INDEX NUMBER

DUBAI OVERALL INDEX

KEY FINDINGS • Q1 2022 had the highest number of rental contracts ever recorded in a single quarter

41,810

• Q1 2022 had a total of 160,530 rental contracts, of which 51.89 per cent were new and 48.1 per cent were renewals

1 0.8 0.6 0.4 0.2

Mar 2022

Apr 2022

Jan 2022

Feb 2022

Nov 2021

Oct 2021

Sep 2021

Aug 2021

Jul 2021

Jun 2021

Dec 2021

Apr 2022

Mar 2022

Jan 2022

Index value Dhs132,917

Feb 2022

Nov 2021

Dec 2021

Oct 2021

Sep 2021

Dec 2020

Apr 2022

Feb 2022

Mar 2022

Dec 2021

Jan 2022

Oct 2021

Nov 2021

Sep 2021

Jul 2021

Aug 2021

Jun 2021

Apr 2021

0 May 2021

0 Feb 2021

0.4 0.2

Mar 2021

0.4 0.2

Jul 2021

0.6

Index value Dhs132, 152

Aug 2021

0.6

Jun 2021

1 0.8

May 2021

1 0.8

Apr 2021

1.2

Index value Dhs127,680

Mar 2021

Index value Dhs126,045

Feb 2021

Index value Dhs47,578

Jan 2021

Index value Dhs47,078

1.2

Jan 2021

May 2021

Apr 2021

Mar 2021

Jan 2021

DUBAI VILLAS/TOWNHOUSES INDEX

1.4

Dec 2020

SOURCE: PROPRIETARY PROPERTY FINDER DEMAND DATA, JANUARY 2021 TO APRIL 2022

Index value Dhs46,833

Feb 2021

Dec 2020

1.4

gulfbusiness.com

Index value Dhs51,672

1.2

DUBAI APARTMENTS INDEX

Index value Dhs48,476

Index value Dhs51,578

1.4

RENTAL LEASES: 60.4% WERE NEW, WHILE 39.6% WERE RENEWALS INDEX BASE: JANUARY 2013

• March had a total of 44,783 rental contracts, of which 60.28 per cent were new and 39.72 per cent were renewals

Index value Dhs50,730

Index value Dhs52,280

APRIL HAD

June 2022

Where to stay? The most sought-out areas in Dubai’s residential real estate market, with details about the average sales and rental rates SALES: APARTMENTS

SALES: TOWNHOUSE/VILLAS

Dubai Marina

Dubai Hills Estate 16.60%

9.80%

Downtown Dubai

Palm Jumeirah 12.70%

Palm Jumeirah

TOP 5 SEARCHED AREAS

8.60% Business Bay 7.20% Jumeirah Village Circle 5.20 %

7.10%

February, March and April 2022 combined

AVERAGE PRICE PER TYPE OF UNIT

DHS MILLIONS * DHS THOUSANDS

Studio

Arabian Ranches

TOP 5 SEARCHED AREAS

6% DAMAC Hills (Akoya by DAMAC) 4.20% The Springs 4%

February, March and April 2022 combined

AVERAGE PRICE PER TYPE OF UNIT

DHS MILLIONS

2 Bed 750* 1.1

410*

1.9 1.99 1.95

1.4

1 Bed

3 Bed 693*

1.1

1.3

1.6

2.3

2.4 2.8 2.9

2 Bed

9.5

4.1

4 Bed 1.1

1.8 2

3 3.1

3.2 3.7

3 Bed

4.4 4.7

15.7

5 Bed 1.5

3.2

2.6

4.5 4.8

5.2 6 6.6

RENT: APARTMENTS

RENT: TOWNHOUSE/VILLAS

Dubai Marina

Dubai Hills Estate 10.90%

Downtown Dubai

Jumeirah 7.70%

6.40%

Business Bay

TOP 5 SEARCHED AREAS

6.90% Jumeirah Village Circle 5.90% Jumeirah Lake Towers 4%

February, March and April 2022 combined

AVERAGE PRICE PER TYPE OF UNIT

DHS THOUSANDS

Studio

Al Barsha

TOP 5 SEARCHED AREAS

4.40% The Springs 4.30% Arabian Ranches 4.20%

February, March and April 2022 combined

AVERAGE PRICE PER TYPE OF UNIT

DHS THOUSANDS

2 Bed 34 40

50 55

95 105 108 110 115

1 Bed

3 Bed 48

60 70

147 154 155 168

2 Bed

200

4 Bed 70

105

125

195 200 220 240

180

3 Bed

270

5 Bed 110 115

140

180

290

250 260 280 290 325 SOURCE: PROPRIETARY PROPERTY FINDER DEMAND DATA, JANUARY 2022 TO APRIL 2022

June 2022

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Record growth The areas in Dubai that recorded the largest number of residental sales transactions from January to April this year APARTMENTS

VILLAS/TOWNHOUSES

OFF-PLAN

Business Bay Mohammed Bin Rashid City The Lagoons Jumeirah Village Circle Downtown Burj Khalifa Dubai Marina Meydan City Arjan Dubai Harbour Jumeirah (La Mer)

1222 806 739 633 602 468 396 309 285 163

SECONDARY Jumeirah Village Circle Business Bay Dubai Marina Downtown Burj Khalifa International City Palm Jumeirah Jumeirah Lakes Towers Jumeirah Beach Residence Muhaisnah Dubai Hills Estate

751 704 654 567 417 414 341 241 235 215

The Valley Arabian Ranches 3 Villanova Dubai South (Dubai World Central) Rukan Town Square Tilal Al Ghaf Dubai Investments Park Al Barari Damac Hills 2 (Akoya Oxygen)

YTD 2022

Dhs73,634,727,867

349 315 312

SALES 11,377 units

265 93 85 75 73 60 49

SECONDARY

OFF-PLAN

16,130 units

Dhs33,874,217,989

SECONDARY Damac Hills 2 (Akoya Oxygen) Dubai Hills Estate Arabian Ranches 2 Arabian Ranches Dubailand (Villanova) The Springs Al Furjan Town Square Reem Jumeirah Park

233 144 107 94 86 80 73 72 59 59

MORTGAGE SECONDARY

5,841

SALES VALUE

Dhs56,970,561,740

Total sales volume

21,719 Off-plan

8,679

Secondary

13,040

SALES VALUE

Dhs18,199,610,149

Total sales volume

6,983

Sales volume

15 units SOURCE: DUBAI LAND DEPARTMENT

MORTGAGE

SALES

Sales volume

units

OFF-PLAN

Off-plan

2,771

Secondary

4,212

MORTGAGE VALUE

February to April 2022

April 2022

Total mortgage volume Mortgage volume

Dhs28,905,314,455 4,587 Off-plan

Secondary

4,574

MORTGAGE VALUE

Dhs7,986,043,105

Total mortgage volume

1,424

Mortgage volume

Off-plan

Secondary

1,421

SOURCE: DLD TRANSACTIONS REGISTRY

gulfbusiness.com

June 2022

BRAND VIEW

How fresh perspectives are driving the real estate sector’s recovery

As the post-pandemic horizon looms, a marked cultural shift towards a more meaningful and conscious lifestyle is shaping the future of Dubai’s residential property sector BY HAWAZEN ESBER, CEO, MAJID AL FUTTAIM COMMUNITIES

n 2020, 69 per cent of consumers in the MENA region predicted that the way in which they live their lives would significantly change following the Covid-19 pandemic. Two years later, the health crisis may have extended beyond the expected timeline, but its legacy has already made itself evident. Most notably, a mass reassessment as to what makes life meaningful by consumers has led to a re-evaluation of personal consumption habits, a renewed focus on health, wellbeing and leading an active, outdoor lifestyle, and the dawning realisation that paying attention to the social and environmental impact of conspicuous consumption requires more than mere lip service. This adjustment to the consumer mindset represents a seismic shift that is being felt across every industry all around the globe, from the retail sector

June 2022

being prompted to adopt a more authentic way of doing business as an increasingly influential segment of consumers shun brands that are without purpose and don’t align with their values, to the e-commerce boom resulting from shoppers being propelled into buying daily necessities online as lockdowns rolled into place across nations, many for the first time. For the real estate sector, buyers are increasingly prioritising purchasing homes in walkable neighbourhoods that promise a better quality of life, have access to green open spaces, and are constructed with sustainability principles at the front of mind. Having gone from strength to strength over the course of the past two years, Dubai’s residential real estate sector is proving no exception to the global trend. Having rebounded in 2021 with an

impressive 65 per cent increase in transaction volumes and a 71 per cent rise in value on the previous year to reach a total value of Dhs300bn, villa sales have and continue to perform well. Recent reports show an annual rise in villa transactions of 20.4 per cent and 1.9 per cent month on month in April alone; conversely, apartment prices are up by 9.6 per cent year-on-year but showed a slight decrease of 0.1 per cent cent. Overall, the market saw record sales of Dhs18.2bn in April 2022; the highest value recorded for the same month since 2009. The outlook remains bullish, with the residential market remaining below the 2014 peak, indicating ample room for growth – an appealing outlook for both investors and owner-occupiers. Another influential factor is that the global prime markets are experiencing a robust uptick in volume and values. Driven by the world’s wealthiest seeking to minimise risk by diversifying their portfolios through increased investment in real estate, which is widely seen as a more tangible asset class, the outlook for prime capital values across the world’s global gateway cities is overwhelmingly positive. With the world’s population of

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ultra high- net-worth Individual (UHNWIs) forecast to increase by 27 per cent by 2025, which will see over 660,000 individuals each having $30m or more in net assets, and with around two-thirds of this wealth typically being tied up in property, the expectation for this trend to continue is entirely reasonable. Dubai has seen its prime residential market rise by almost 60 per cent in the last 12 months to reach its highest level since 2015, following an annual capital value growth rate of 17 per cent in 2021. According to Knight Frank, 93 homes valued at over $10m were sold in Dubai in 2021, more than in the previous five years combined. Compared to other global gateway cities, Dubai remains undervalued, despite prime residential values having climbed 17.4 per cent last year. Consequently, the city offers significant appeal to high-net-worth individuals looking for global real estate investments with substantial room for growth, the added benefit being that the UAE’s business hub offers an increasingly friendly foreign direct investment environment bolstered by recent legal and regulatory reforms that not only simplify repatriation but bring added security for those that desire to remain for the long term. Combined with the enduring appeal of world-class infrastructure, ongoing urban greening projects, and an outstanding quality of life, the way in which Dubai handled the health crisis has also engendered high levels of trust in a world where, for many, the

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“Dubai has seen its prime residential market rise by almost 60 per cent in the last 12 months to reach its highest level since 2015, following an annual capital value growth rate of 17 per cent in 2021. According to Knight Frank, 93 homes valued at over $10m were sold in Dubai in 2021” world appears to be rife with uncertainty. Going forward, price acceleration is predicted to be fuelled by a scarcity of super-prime villas in the property pipeline, driving the gap between supply and demand, combined with low mortgage rates and continued interest from foreign investors. Tilal Al Ghaf, Majid Al Futtaim Communities’ landmark destination in Dubai, epitomises how residential developments can be shaped to deliver to the fresh wave of consumer demand arising from the new collective consciousness that will reframe how we live in the post-pandemic future. The peaceful resort-style gated community stretches out around a central recreational lagoon with crystalclear azure waters bordered by white sandy beaches. An open green communal space, The Park, slopes gently down to the lagoon’s

shores and, carefully positioned to take full advantage of the stunning vista, is the Pavilion – Tilal Al Ghaf, which stands as a testament to Majid Al Futtaim Communities’ commitment to sustainable living and lifestyles. Currently in use as the destination’s Sales and Experience Centre, The Pavilion is the region’s first ‘Zero Positive’ building and the first in the UAE to achieve the BREEAM Excellent rating. Painstakingly designed according to biophilic design principles to strike the right balance between cutting-edge aesthetics and environmental standards, the building was most recently recognised at the 2022 BREEAM Awards with the Regional Award for Asia; past awards and certifications include WELL ILFI Zero Energy certification and MENA Green Building Awards – Zero Building of the Year 2019. The Pavilion embodies the unique lifestyle proposition offered by the wider Tilal Al Ghaf community. As Dubai’s first BREEAM interim certified project, Tilal Al Ghaf adheres to a development approach rooted in human-centric design and robust sustainability standards to deliver an exceptional quality of life and great experiences every day. Ample opportunities for residents to connect with nature and lead an active outdoor lifestyle are provided with nearly 500,000 square metres of parks, green open spaces and treescapes throughout the community, which is designed to be walkable with neighbourhoods interconnected by 18 kilometres of walking trails and 11 kilometres of cycling and jogging tracks. Consisting exclusively of townhouses, villas and – for the super-prime segment – mansions, the single-family premium community caters to a range of life stages and budgets, from couples and young families looking for their first home to more established individuals looking to invest in an expansive six-bedroom waterfront property, with unique features such as an internal garden oasis in the heart of the home, private spa and gym zones, and direct beach access.

June 2022

Market Outlook

COMMENT

Dr Michael Waters, global director of postgraduate real estate programmes, Heriot-Watt University Dubai

On an upward trend We look at how Dubai’s real estate sector is evolving post Expo 2020

t’s been two months since the curtains were drawn on Expo 2020 Dubai. Despite a year’s delay, the event successfully managed to bring the world together in Dubai. The preparations to welcome a global audience to the emirate began when Dubai was announced as the host of Expo 2020. As a result, the real estate sector went into overdrive, developing properties in anticipation of the millions of visitors expected to come to the country. The industry soon realised that demand for short-term rental units and increased interest

June 2022

in property ownership, either as a resident or an investor, would rise rapidly. For many cities, hosting a mega event is now the single largest undertaking in urban development. The first supportive argument for hosting a global event would be the potential increase in visitor numbers, a spotlight or halo effect that brings new attention and vibrancy to the host city. Similarly, expenditure on hosting a mega event is often justified via the multiplier effect and a boost to the national economy. Real estate studies in a range of global cities do find a positive impact on property values. Though as we saw, these property price increases are not simply linear. Academic studies have found that the largest price increases in property prices hosting mega events occur in the five years after the event. So are we on a similar trajectory in Dubai post the expo? Following a dip in real estate activity during the beginning of the Covid-19 pandemic, housing prices in Dubai began to recover in 2021 in the run-up to Expo 2020, particularly in the luxury real estate sector, which ended the year with record-breaking transactional value and sales volume. A market report by Property Monitor shows that property value in Dubai now stands at gulfbusiness.com

Market Outlook

“AT PRESENT, DUBAI IS WITNESSING A DEMAND-OUTSTRIPPING-SUPPLY PLAYBOOK; AND WITH GLOBAL INFLATION SOARING, THE INCREASED COSTS OF BUILDING MATERIALS FOR NEW DEVELOPMENT AND HIGHER BORROWING COSTS, NEW DEVELOPMENTS MIGHT STAGNATE, LIMITING NEW SUPPLY ENTERING THE MARKET AND PUSHING HOUSE PRICES HIGHER”

Dhs1,000 per square foot, the highest since January 2019. Additionally, it is reported that transaction volumes in February this year stood at 6,346, growing nearly 10 per cent monthly. Furthermore, a total of 12,119 sales transactions were recorded year-to-date, a 17.7 per cent increase over 2017, the previous best start to a year. Major public and private developers in the UAE have been focused on ensuring a faster execution of the ongoing projects to deliver the best quality product to investors. The pace has also been a response to various government initiatives and amendments to laws that will undoubtedly attract more residents and longterm investors to the country. For example,

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Dhs1,000

PER SQUARE FOOT PROPERTY VALUES IN DUBAI ARE THE HIGHEST SINCE JANUARY 2019

the recent amendments to the citizenship laws allow investors, professionals, special talents and families to seek long-term/permanent residence under certain conditions. Additionally, the UAE has made many additions to its real estate laws. These include the new ‘Dubai Building Code’, which outlines a set of construction rules promoting sustainable development and innovation in building design and reduction of energy and other running costs, which is critical in today’s everimportant ‘ESG’ investing. However, with all these changes and an increased interest in buying a property, it is also imperative to look at the inventory currently available in Dubai while prices also seem to be climbing. A recent report by S&P Global suggested that property prices and rents in Dubai’s residential market will continue to increase in 2022. In addition, Property Monitor reported that more than 3,000 off-plan residential units entered the market for sale in February. Townhouses represented 58.5 per cent by volume of this new inventory, while apartments and villas accounted for 36.8 per cent and 4.7 per cent, respectively. According to Property Monitor, the month-on-month increase is largely the result of newly handed over projects that are now eligible for home financing, particularly for townhouses, which saw loan volumes increase by 58.9 per cent. At present, Dubai is witnessing a demandoutstripping-supply playbook; and with global inflation soaring, the increased costs of building materials for new development and higher borrowing costs, new developments might stagnate, limiting new supply entering the market and pushing house prices higher. While Expo 2020 has been a major catalyst in real estate growth in the emirate, the next phase will be even more exciting. Despite the rising real estate prices and increasing inventory, the interest from international and local buyers and renters will be an ongoing trend, with Dubai’s supportive government legislation being a key driver of new population growth over the next five years. The city is developing to accommodate more new businesses, more flexible ways of living and working in Dubai, and the recent trends in ‘lifestyle migration’ into Dubai will undoubtedly continue and boost future demand for the real estate sector. June 2022

Property Management COMMENT

HP Aengaar, CEO Asteco

“ALTHOUGH REGULATORY AUTHORITIES HAVE STRICT LAWS IN PLACE TO PROTECT CONSUMERS FROM SUCH ACTIVITIES, WORKING WITH LICENSED AGENTS IS THE MOST EFFECTIVE WAY TO AVOID FALLING VICTIM TO SCAMMERS”

Protect your interests There’s a rising number of property management firms available to cater to demand, but are they all equal?

ifferent stakeholders have varied real estate needs – whether it’s an investor looking to grow ROI, a property owner looking to increase income generated from leasing, or a tenant looking to find a new home to live or work in. All these stakeholders have a choice of how they go about fulfilling their requirements – some handle it independently, while others choose to hire a property management firm. As someone in the field, I would recommend working with the latter for many reasons, the most important of which is that professional property managers are involved in and understand various layers, ranging from staging and marketing to contract management, procurement and management of service providers, including facilities management and maintenance companies, as well as financial management for larger property portfolios.

June 2022

There’s a rising number of property management firms available to cater to demand, but are they all equal? Definitely not. Doing your due diligence prior to entrusting any individual or organisation with your real estate needs is important, as this choice can have very rewarding consequences, or lead to financial loss. Partnering with professional property managers will ensure: An understanding of the intricacies of the real estate landscape, current market conditions and trends, relevant legal rules and frameworks, and, most important, risk factors that may impact property investment performance. An extension of the property’s lifecycle and increase in its value over time by ensuring regular maintenance to keep the asset in excellent condition. Management of vendor relationships – a timeconsuming and knowledge-intensive task. Correctly priced properties to maintain a sense of competition in the market while attracting the right potential tenants, resulting in higher occupancy rates and tenant retention. Implementation of smart, automated technology to raise the value of a property. Assistance in identifying and assessing trustworthy renters who will care for the property. Verification of documents for tenancy or sales transactions before they are concluded to protect the interest of all parties. Protection from illegal or fraudulent tactics. The number of real estate scams have increased in recent years, causing homeowners and tenants significant financial losses. Although regulatory authorities have strict laws in place to protect consumers from such activities, working with licensed agents is the most effective way to avoid falling victim to scammers. Licensed agents provide the highest level of service and are required to carry liability insurance. gulfbusiness.com

Interview / Property Development

The UAE’s property market has emerged as a safe haven for investors. Tell us about this trend and its impact.

A strong foundation In an exclusive interview with Gulf Business, Atif Rahman, founder and chairman, ORO24 Developments, talks about the highlights of the UAE’s property market and the success of the company’s latest project, TORINO by ORO24

What are the factors that have bolstered the growth of the UAE’s real estate sector in the past two years?

The UAE today embodies the best example of governance. We must understand that nothing here happened overnight; it’s taken decades of supreme effort from the government to create what we are experiencing and enjoying today. Dubai and the UAE have done everything right in the past few years. Be it infrastructure development, trade liberalisation, immigration reforms, the successful staging of Expo 2020 and the swift decisions taken to tackle the impact of the pandemic. These factors have played an important role in the recovery and growth of the real estate sector.

real estate firm that aims to meet all our clients’ needs. We pride ourselves on creating a unique combination of convenience and lifestyle offerings at attractive price points. We have incorporated next-gen technology in our business, which enables us to deliver unique and innovative solutions. A glimpse of that can be seen in our latest project TORINO By ORO24, which has been successfully received by clients and buyers. TORINO is an exclusive gated, residential community, which is located in Arjan. The project consists of contemporary homes offering excellent amenities that complement modern living. What is the company’s key USP?

Any key trends that hold promise based on the first quarter’s results?

I see two distinct trends. Consumers are coming in from a wider demography and particularly from countries, which previously did not invest in the UAE’s real estate sector. I’ve also seen an unprecedented increase in consumer confidence, both from new and old residents, not just in the real estate sector, but across all sectors and the overall economy of Dubai and the UAE. Tell us about your company and how it has leveraged the uptick in the UAE’s property market?

ORO24 Developments is an innovative gulfbusiness.com

I consider property development a serious business, which must be backed by techno-commercial-legal core competencies to eliminate risks, which otherwise are far too many in this trade. Often, a step taken forward can’t be undone. So, I believe we must focus and carefully plan our progress. It’s also important to clearly understand the objective of one’s business. I value people’s confidence in ORO24 and we want to ensure that every real estate offering we present to the market delivers tremendous value, features a unique consumer-friendly, sustainable design, and is delivered within the promised timeline.

Through its investor-friendly regulations, the country provides great protection for investors and their investments. I see a strong demand in the real estate sector specially for residential assets. Historically, a large volume of expats employed in UAE would prefer investing in their respective home countries. The immigration reforms coupled with the government’s efficient handling of the pandemic has changed the dynamics of how expats consider their residency in the UAE, with many of them choosing to buy homes here now. How would you define the future of the real estate market and how has technology transformed the sector?

The real estate industry itself is conventional and will evolve slowly. We must ensure that all new methods of building are time-tested and sustainable. However, the use of technology will continue to increase in design, experience, marketing, delivery etc., as part of the segment popularly known as proptech. We incorporate a lot of building information modelling (BIM) data into our design process. We have invested heavily in cybersecurity and enterprise resource planning (ERP) systems to create seamless and secure transactions for our consumers. We have also infused artificial intelligence in many segments of our business process for efficiency. Give us your future outlook for the market.

In my belief, the market and demand will continue on an upward trajectory for a considerable time. There is a high momentum particularly in the off-plan segment and it will only grow, knowing the investor sentiment and attractive commercial offers being provided by developers. The country is among the top three property investment destinations in the world; however, property prices are still way below the global rates, and that’s a big draw for investors. June 2022

BRAND VIEW

Building on expertise Porush Jhunjhunwala, CEO of Banke International Properties, showcases his company’s operations and expansion, and talks about UAE’s thriving property sector and how investors can make the most of the current trends Tell us about your company and its operations? Banke International Properties is a fullservice boutique real estate brokerage founded in 2013. Our team, which has over 200 members, has sold more than 10,000 properties, including 200 off-plan projects. We’ve won several awards, including BAYUT’s Agency of the Month for December 2020; Emaar’s Broker Awards 2021; and Best Real Estate Agency of the year 2021 from IRECMS. Sobha Realty awarded us for being its Top Performing Channel Partner in 2021, and we’ve also received the Aldar Honours Award for Best Customer Service in 2021. We’ve recently expanded and opened a new branch office in Abu Dhabi, specialising in residential properties that include ready primary sales and offplan properties across the UAE. We’ve also opened new boutique offices in Dubai Creek Harbour and Al Furjan that handle sales and leasing of residential properties primarily in these areas. We have a dedicated property management team, who manage over 1,200 units, offering leasing services starting from arranging property viewings for potential tenants, negotiating, preparing tenancy contracts, collecting valid and original documents, to handing over the key to the tenant. We also offer property maintenance and advisory services. How has technology transformed your business? Technology has made us far more efficient particularly during the pandemic. We had the opportunity to build our own in-house customer relationship management (CRM) system, which has enabled us to capture leads from all the leading real estate portals as well as other campaign leads. We’ve also

November 2021

built an app for landlords, which helps property owners get access to their real estate portfolio at the click of a button. Offering virtual property tours have helped the industry, as overseas and domestic buyers can view videos and shortlist the properties they would like to view physically. This has also increased the productivity of our agents. Technology has also enabled customers to rate us and give feedback online. Currently, we have a Google rating score of 4.6/5. Google reviews offer our business more credibility. To enhance customer experience, we’ve also developed a customised QR code that makes it easier for clients to review us on Google. Tell us why the secondary market remains a good option for investors. We mostly know the benefits of buying a ready property that includes being able to physically inspect the property before the potential purchase and to move in just after the paperwork is completed. Other advantages include immediate rental income generation, higher loanto-value (LTV) ratio (when applying for a mortgage from the bank); higher

returns when market prices spike and no risks of delay during the handover. Whether you’re buying an off-plan or ready property, it is important to conduct a competitive market analysis. Also check rental prices of similar properties in the area to give you an idea of the rental revenue you can generate. What are the benefits of buying off-plan? Off-plan properties are available at competitive prices compared to ready ones, as developers compete to offer customers the best deal. The market value of an off-plan property also gets a major appreciation upon handover as surrounding areas get better transport links, amenities and retail infrastructure. The payment plans for off-plan developments are linked to construction which means you don’t have to pay the entire cost upfront but in smaller installments. Many off-plan projects in Dubai have a booking fee of only 10 to 15 per cent and in some cases the DLD fee is also completely or partially waived off, giving the buyer added price benefits. Projects with long term post-handover payment plans let buyers pay for years after getting possession of the property. This is not possible with ready properties unless you’re buying the property on mortgage where a loan interest is applicable. Buying off-plan property in Dubai is safe. The Dubai Real Estate Regulatory Authority has implemented a system of regulations protecting the buyer against any type of delays or project cancellations. Buyer installments are deposited only in regulated escrow accounts and developers can access them as they meet construction milestones. Any tips for property investors? It’s a great time to invest in real estate, as inflation is at an all-time high and real estate investments’ value can hedge against inflation. The returns on your investments are higher due to higher demand. The rental yield is still strong and with the rental prices increasing we see the yield improving.

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JUNE

Lifestyle

Always summiting Montblanc has a strategy for its luxury watch business that has seen it rank among the world’s best – only for it to now push even further p.68

“Today, we’re deploying almost more than one million seats per week. We have managed to return to 90 per cent of our pre-Covid network with 130 destinations” — Adnan Kazim, chief commercial officer at Emirates Airline

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Girard-Perregaux The Laureato Absolute Chronograph Aston Martin F1 Edition features a 44mm case made from a composite material of titanium and carbon taken from two F1 cars used during the 2021 season

June 2022

Lifestyle / ATM 2022

A SHOW OF STRENGTH AIRLINES, HOTELS, TOURISM BOARDS AND TRAVEL TRADE OPERATORS FROM AROUND THE WORLD CAME TOGETHER FOR THE ARABIAN TRAVEL MARKET 2022 EVENT IN DUBAI THAT HIGHLIGHTED THE VERY BEST THAT THE INDUSTRY HAS TO OFFER BY VARUN GODINHO

o have your finger on the pulse of the region’s underlying travel and tourism sentiment, all you needed to do was visit the Dubai World Trade Centre between May 9-12. The Arabian Travel Market (ATM) had a palpable buzz that ran through the length of the show floor across its approximately 1,500 exhibitors. After all, it was the first full-fledged show since the start of the pandemic, following a muted scale of an event last year. This year was when ATM made a comeback that counted – and it was

June 2022

a feeling that resonated pervasively through the 30,000 participants and 23,000 visitors.

It was only logical for nearly every major airline, hotel brand and tourism board either operating in the region, or seeking to make in-roads within it – or those attempting to woo travellers from it – to be present at the 29th edition of ATM. Data shared by Colliers International meanwhile forecasted that $4.5bn worth of hotel construction contracts will be awarded in the GCC during 2022. According to research from STR, commissioned

by ATM 2022, it showed that as of March this year there were a total of 32,621 hotel rooms under construction in Saudi Arabia alone. A STRONG PRESENCE

From a sprawling Saudi Tourism pavilion which highlighted developments from its

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$4.5bn

WORTH OF HOTEL CONSTRUCTION CONTRACTS WILL BE AWARDED IN THE GCC DURING 2022

SAADIYAT ISLAND EXPECTS TO ATTRACT

19 million VISITORS

AND CONTRIBUTE DHS4.2BN IN DIRECT TOURISM REVENUE BY 2025

giga projects, not least Diriyah Gate, The Red Sea Project and Amaala, the impressive setup was only a few metres from the three-storey Saudia stand with a staircase that extended the breadth of the pavilion. One of the big announcements by Saudi Arabia’s flag carrier at the ATM was the launch of its all-new rebranded Saudia Business B2B division that customises travel solutions for corporate, agency and MICE clients. Metres away from the Saudia pavilion was none other than Dubai’s Emirates, who used the ATM to showcase the full range of its new premium economy class which will initially be rolled out on aircraft servicing the London, Paris and Sydney routes starting this August. PROJECTS IN THE SPOTLIGHT

From within the UAE, there were major showings by the individual emirates from

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We surveyed travellers about what matters most to them when they are travelling and they prioritised attractions, activities and tours above other factors. Experiences are not just the ‘things to do’ – they are the reasons to go”

Sharjah and Ras Al Khaimah (there wasn’t an announcement as big as the Dhs500m sustainable development plan it announced at last year’s ATM – although there was much discussion about the recently announced Wynn Resorts project). Abu Dhabi’s presence at the ATM meanwhile was an opportunity for it to shed light on the Department of Culture and Tourism – Abu Dhabi’s (DCT Abu Dhabi) move to appoint Miral to oversee Saadiyat Island’s destination management strategy. Saadiyat Island expects to attract 19 million visitors and contribute Dhs4.2bn in direct tourism revenue by 2025. Managing destination experiences is an area tourism boards are increasingly investing resources into. The role of in-destination experiences was discussed during the opening session of ARIVALDubai@ ATM forum. “We surveyed travellers about what matters most to them when they are travelling and they prioritised attractions, activities and tours above other factors. Experiences are not just the ‘things to do’ – they are the reasons to go, representing a significant opportunity for the travel and tourism industry,” said Douglas Quinby, cofounder and CEO of Arival. In 2019, global gross industry sales of travel experiences reached $254bn. It was the third-largest sector in travel and tourism, after transportation and accommodation, with almost a million operators worldwide. It’s reason enough for the likes of Qatar Tourism to announce that it will launch a new Qatar Specialist learning programme soon for global trade travel partners to familiarise them with the country’s offering – a similar programme was launched by the Saudi Arabia’s Royal Commission for AlUla, called the AlUla Specialist programme, at the ATM this year too. INTERNATIONAL EXHIBITORS

Across the corridor from the aviation stands at the ATM, several international tourism boards were present – they were there to make sure their destinations were top-ofmind for high-spending and well-travelled GCC tourists. Tourism Malaysia said that in 2019, the country received 397,726 tourists from the MENA region. Saudi Arabia was Malaysia’s top source market, accounting for 121,444 tourists. The magnitude of the GCC as a powerful contributor to global tourism was only reinforced by Yamina Sofo, director of sales and

June 2022

Lifestyle / ATM 2022 THIS YEAR WAS WHEN ATM MADE A COMEBACK THAT COUNTED

30,000

PARTICIPANTS

23,000

VISITORS

marketing at the German Tourism National Office, who says, “The GCC is now the second-most important incoming market for tourism for Germany, just behind the US. The GCC market came back very fast last year and we ended 2021 with plus 83 per cent compared to 2020. We’ve already seen that in the first two months of January and February this year, we’re plus 200 per cent compared to the same two months last year. “The GCC customer has a high purchasing power. GCC guests on average spend Eur4,750 per person per trip, which is much higher than the Eur2,500 spent on average by other overseas guests. The GCC guest stays longer too – an average of 12 nights per visit. Pre pandemic, in 20182019, we had 1.6-1.8 million overnight stays from GCC guests in Germany – and by GCC guests, we are only referring to GCC nationals.” Other major tourism boards including Qatar tourism participated with over 35 partners at the pavilion, whereas those such as Jamaica Tourism Board made its show debut at the ATM and leveraged opportunities including one wherein Edmund Bartlett, Minister of Tourism for Jamaica, met with Sheikh Ahmed bin Saeed Al Maktoum, chairman and chief executive, Emirates Airline and Group, at the ATM to discuss possible collaborations. HOSPITALITY REPRESENTATION

With regards to accommodation, hotel companies and individual brands were

June 2022

also represented extensively at the ATM. IHG Hotels & Resorts – which has a portfolio of 6,000 hotels in over 100 countries across brands including InterContinental, Voco, Six Senses and Holiday Inn – took the opportunity at ATM to showcase its newly released IHG One Rewards loyalty programme. Rotana meanwhile announced the launch of the Edge by Rotana brand that allows hotel owners to maintain their unique styles and offerings, bypassing traditional management transitions, while linking up to Rotana’s management and commercial systems. Radisson Hotel Group meanwhile outlined their upcoming Radisson Resort Palm Jumeirah property in Dubai, and also its plans for the Saudi market where it operates 24 properties at the moment, with another 20 under development in the kingdom. Shortly before the ATM began, another of the show’s prominent participants, the UAE-based hospitality company Time Hotels, said that it plans to increase its

portfolio by 40 per cent to 21 properties across the UAE, Saudi Arabia, Egypt and Sudan by 2023. Other UAE homegrown brands including Emaar Hospitality Group and Jumeirah Group too were present and outlined plans for growth across the region. Some of the key trends that were repeated by many of the hotels and other stakeholders was the rise of the “Bleisure” – business plus leisure. The trend is evident by moves such as the Ajman Free Zone signing four MoUs with the Fairmont Hotel Ajman, Bahi Ajman Palace Hotel, Zoya Health & Wellbeing Resort Ajman, as well as Altayar Travel & Tourism at the ATM 2022, in effect recognising that business and leisure travellers are indeed not mutually exclusive categories. If the ATM proved that the industry as a whole was on a path of high growth, it was figures released by Dr Ahmad Belhoul Al Falasi, UAE Minister of State for Entrepreneurship and SMEs and Chairman of the UAE Tourism Council, a few days later, that showed the strong foundation upon which that growth was being delivered. In Q1 2022, the UAE’s hotel establishments attracted nearly six million visitors who spent 25 million hotel nights, a growth of 10 per cent over Q1 2019. Hotels also generated a total revenue of Dhs11bn over the first quarter of this year, a 20 per cent growth compared to the corresponding period in 2019. When pre-pandemic benchmarks are brought into play, it’s perhaps time to start believing that the recovery is permanent.

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Lifestyle / ATM 2022

An industry in motion HERE’S WHAT SOME OF THE KEY STAKEHOLDERS IN THE HOSPITALITY AND TOURISM INDUSTRY HAVE TO SAY ABOUT THE GROWTH AND FUTURE PROSPECTS OF THEIR SECTORS

BERTHOLD TRENKEL

Chief operating officer at Qatar Tourism Scale of the tourism industry Last year, we were asked by the Supreme Council for Economic Affairs and Investment to come up with a 10-year plan that included our strategy and metrics. Tourism contributes about 6-7 per cent of GDP. In the plan, we’re essentially doubling that to 12 per cent. That figure includes both direct and also indirect contributions to the GDP. It would make tourism one of the top three sectors contributing to the country’s GDP. When it comes to employment, pre-Covid, the tourism sector [in Qatar] had around 120,000 employees. Now with the aim to double the contribution to GDP, we should be growing this to around 220,000-250,000 employees.

Role of regulations in the tourism sector This whole regulation strategy is something we’ve been working on the last two years with consultants. There were a few areas where the regulation was not very mature, for example,

adventure tourism and activities in the desert that either had no regulations or very light regulations. We’re making them much more professional and robust. And that impacts the private sector because we’re putting standards in place for them to have either a licence or to go through inspections. The tricky part is to get the balance right. You need some level of regulation, but you don’t want to over-regulate.

Opportunities for growth Qatar has 560km of coastline, most of which is a beach. Some of those beaches are absolutely stunning, but they are lagging in terms of infrastructure. So, we are working with the municipality and with the Minister of Environment to unlock some of that potential. The first thing we are doing is the beach redevelopment in downtown Doha, which was where all the embassies were previously located. Many of the embassies have moved out of that area over the last few years. Now it has been opened up as a beach. A portion of that stretch will be a public beach, and some of that will be a private beach. We’re working with private operators and hotels who want to have access to the beach because it will enhance their value proposition if a city centre hotel suddenly has beachfront access for its guests – this could be a gamechanger.

ALEXANDER LEE

Chief commercial officer at Jumeirah Group On recent projects This year has been great because we’re growing our portfolio within the region and further. We have two projects very close to opening – one is in Muscat and the other is in Bahrain. We’ve just opened our first property in Bali as well. We have a number of destinations in Dubai where we’re actually ahead of pre-pandemic levels in terms of occupancy.

On expansion in Saudi Arabia We’re very focused on Saudi as an emerging destination brand and we have a number of projects. We have a property under development in Makkah that we expect to open this year, or early next year. And it’s part of a large master plan development within Makkah. We’re also keen to pursue opportunities in Riyadh and Jeddah.

gulfbusiness.com

June 2022

Lifestyle / ATM 2022

maturity perspective and a preparation perspective. It has villas in the clouds, where you’re 31 storeys in the air. There’s more space outdoor than within the suite too. This is luxury at a new level.

On the culinary oﬀerings at The Royal It will have 17 restaurants. In this destination alone, we have eight celebrity chefs. We will have the same amount of restaurant seats at Atlantis The Royal that we do today at Atlantis The Palm – about 4,000 restaurant seats in total.

On its unique positioning Our wellness programme is broken into three pillars. One is the traditional wellness [space] and has a 50,000 sq ft spa fitness facility. We also have a medical clinic which is our second pillar, and our third pillar is our regenerative medicine programme. Regenerative medicine focuses on anti-ageing, stem cell therapy, oxygen facial and peptide therapy. Coming to the giga projects in the Red Sea, we have a project under construction on Shurayrah island. We are working very closely with John [Pagano] and his team on how we will enter that market. It’s a very integrated island. We are going to operate it in partnership with Red Sea Development to ensure that it is aligned with their goals.

On emerging trends and growth

International expansion plans for Atlantis Our plan for Atlantis is that we’re looking to expand and grow the brand. We’re looking internationally for the right place that can really house an Atlantis. We’re looking for [factors such as] climate and a coastal area, in most cases. We’ve looked at everything in the Americas, North and South, we’ve been looking in Asia, Vietnam and Bali as well. Regionally, maybe even in Saudi, and then somewhere along the Mediterranean too. But Atlantis is not an easy build. It’s something that requires a lot of vision and time. It’s a five-year process from design to delivery.

Last year, we found [the rise of] pure leisure travel, almost like a sort of ‘revenge travel’ scenario which is another buzzword that’s coming around the industry. We saw leisure travel come back very quickly across our core properties in July. This year, we’re starting to see this b-leisure travel across our properties in Emirates Towers, Jumeirah Creekside Hotel and also in extended stay brands like Jumeirah Living. In 2021, in Dubai, our average length of stay grew by 24 per cent compared to pre-pandemic levels.

TIMOTHY KELLY

Executive vice president and managing director at Atlantis Dubai On Atlantis The Royal What’s arriving in Dubai in the fourth quarter of this year is a resort that comes along in the world maybe a handful of times a decade. What makes it special is that it’s a combination of both residences, as well as hotel accommodations. I think that this is a resort that is overdue for our market, from a

June 2022

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Lifestyle / ATM 2022

MARK KIRBY

Head of Hospitality at Emaar Group Current scale of operations We are 30-plus hotels now. We’ve grown from the downtown [Dubai] area to further afield – we have a Vida Umm Al Quwain property that opened last year, an Address Fujairah which has been really well received in the market and our creek harbour developments in Dubai. We’re very excited that we could expand into other emirates, and now regionally as well. If you look at 2021 numbers versus 2019, for Emaar Hospitality Group, we saw growth. 2022 is showing a progression over 2021 – in the first quarter we did occupancies of 75 per cent plus. In the UAE, we’ve actually seen occupancy numbers coming back to 2019 numbers and even exceeding it [in some cases].

The Saudi Arabia market The Saudi market overall as a percentage of business is anything between 15-21 per cent. In terms of expansion into Saudi, we’re opening up the Address Jabal Omar Hotel in early 2023 first quarter – it’s a 1,480 key hotel with all the premium services of an Address, and we’re very happy to be opening in Makkah. Recently we’ve announced the Diriyah Gate hotel too – it will the third Armani hotel within our group.

On the positioning of the Arabian Travel Market This show has always been very valuable in the region. Last year, was a test for us all to understand what ATM could provide in a pandemic era. We could have a maximum of

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11,000 people at any one time, we were all very careful. This year is just phenomenal, because everything is really back and we’re able to really showcase what we’ve been up to over the last year. Emaar Hospitality, over the pandemic era, opened a number of hotels. We really looked at the future of hospitality and worked on a number of things around that. This show gives us the ability to showcase what we’ve been working on.

On the challenges within the industry Some of the bumps in the road we are seeing is a slight increase in prices in terms of raw products. It’s something we’re having to manage and be careful of because we want to make sure the returns, particularly to our owners, are maintained overall. We’re being very careful in terms of ensuring that each of our expenses are managed effectively. We’re also looking at where we buy our produce from. Now that we’re a slightly bigger company, we can negotiate a little bit more of economies of scale at the same time just really making sure that we continue to deliver value-formoney offerings.

On the approach to growth At the moment we are building ground up. As a hospitality company, we’re growing organically. We’re not a hotel company looking at building 40 hotels this year and 50 hotels in the next. We’re considering four-five hotels every year. We’re focused on an asset light strategy, so we’re looking at investors coming in and working with us in terms of our bands and hotel management and these [hotels] tend to be new builds.

June 2022

Lifestyle / ATM 2022

Maintaining altitude IN AN EXCLUSIVE INTERVIEW WITH GULF BUSINESS ON THE SIDELINES OF ATM 2022, ADNAN KAZIM, CHIEF COMMERCIAL OFFICER AT EMIRATES AIRLINE, TALKS ABOUT THE AIRLINE’S ROADMAP TO SECURE A THRIVING FUTURE FOR ITSELF BY VARUN GODINHO

Give us a sense of the recovery that Emirates has made since the start of the pandemic.

return to 90 per cent of our pre-Covid network with 130 destinations.

The ramp up in our operations began last year when we moved from 30-40 per cent to today where we’re sitting at almost 70 per cent of our pre-Covid capacity that we deploy. We’re moving towards the 80 per cent mark by the end of summer. By winter, hopefully, we will have returned to almost 85 per cent. We have more than 140 Boeing 777 aircraft operating, and have 70 of our A380s in operation too – this number will increase to 90 by winter before the end of the financial year. Today, we’re deploying almost more than 1 million seats per week. We have managed to

Emirates has struck partnerships with several tourism boards over the last few months. What does that mean for the airline from a strategic point of view?

What are Emirates’ plans for the premium economy class which it has showcased extensively at this year’s ATM?

We have signed agreements with the tourism boards of seven countries including Saudi Arabia, Spain, Sri Lanka, Maldives, Seychelles and Thailand. The whole objective is to focus our team and theirs to promote the destination. There’s a budget that we set and a commitment from both sides to selling the destination using that marketing fund allocated by Emirates

We’re pleased to officially announce the premium economy. We’re launching it with six of our A380s. It will be deployed on August 1, and we start selling it in the system from June 1, 2022. The points that we have initially allocated for the premium economy will be London Heathrow, Paris Charles de Gaulle and Sydney. By December, we will add Christchurch in New Zealand.

June 2022

airline and by various governments that we sign the MoU with…and that’s part of the recovery of the airline.

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Lifestyle / ATM 2022

We’re taking our fleet through a major retrofit programme. We’re rolling out the premium economy across 120 aircraft – including 67 A380s and 53 777-ERs. That will commence in November 22 and the programme will take 18 months to be completed. The premium economy is slotted between the economy and business class. I think the premium economy is the gap where we are able to push more economy full-fare tickets into premium economy. I’m sure a lot of people are willing to pay extra money to get that comfort – seats with 40-inch pitch, eight degrees of recline, 13.3-inch screens, and meals similar to business class, including welcome drinks. The target is to deploy it for long-haul and ultra-long flights beyond the sixhour mark because that’s where the real benefit of the premium economy kicks in. What are some of the headwinds that the airline is facing?

There is a lot of volatility out there from the interest rate to inflation to the currency devaluation and oil prices. We haven’t been directly impacted by the Russia-Ukraine [crisis]. We’re trying to avoid fare increases as much as we can. We have taken on fuel surcharge and

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passed a certain extent of it to the consumers, but we have also absorbed a lot of that impact on us as well without passing it to the consumer. We hope if things normalise in the future in terms of the fuel prices, we will definitely take off some of these surcharges and bring these prices down. We’re not seeing that happening at the moment as fuel is still holding at $100-$115. But so far, we haven’t seen a major impact from the demand side or impact on our bottom line because of these volatilities. As a key partner for Expo 2020, how did the airline beneﬁt from that partnership?

The Expo put Dubai on the world map. Based on our statistics, 50 per cent of people who visited Dubai during the Expo were newcomers visiting from countries we never expected. We saw quite a spike in bookings from the US, Canada and many parts of the world that weren’t top source markets for Dubai in the past. I think that the policies that Dubai introduced with golden visas and all the possibilities that Dubai created due to the Expo, helped and encouraged these people to stay back. Dubai will definitely remain a core strategy for Emirates. The awareness that Dubai had two years ago and today are at a different level. Tell us about your loyalty programme Emirates Skywards and the plans for it going forward?

We are reaching almost 29 million members across our Platinum, Gold, Silver, and Blue tiers. It has a lot to do with the measures we took during the Covid pandemic

with refunds paid to people in seven days, and a policy to allow customers to maintain their tier status while keeping their miles untouched. I think because of that, we’re seeing a lot of loyalty towards us. People are coming back to Emirates. We’re ahead because of all the good things we did for our consumers and I think it’s paying off for us in the long term. What is Emirates doing within the area of sustainability in aviation?

We’re engaged with many suppliers. SAF fuel is very expensive – I think it’s four-five times more expensive than the normal fuel. It is not commercially viable. But it’s something that we’re working with various stakeholders in the fuel industry to address. We’re also working with engine manufacturers like GE to see how its engines can consume less fuel and become more economical in the future. The technology that will come in on the A350 and the 777X will result in better efficiency in terms of fuel usage. What can we expect over the shortmedium term from Emirates?

Besides the introduction of the premium economy, the fourth cabin, you will see a completely new fleet of Emirates in three-five years. This will take the airline to a completely new level with the A350s and 777X aircraft that will be a part of this arrangement. There is a lot of investment in our technology platform as well. We have announced our metaverse and NFT [projects]. There is a lot of work happening around the digital measures to make this airline look completely different and more seamless.

June 2022

Lifestyle / Horology

Signature craftsmanship Franck Juhel, president of Montblanc Middle East, India and Africa oversees the regional operations for the brand, which is renowned for its writing instruments and leather goods – and ever increasingly, its high-profile portfolio of luxury watch offerings BY ANDREW WINGROVE

You oversee a vast market that includes the Middle East, Africa, Turkey, Greece and India. How different are Montblanc customers in these markets?

Any customer is different irrespective of the market they are within. The beauty and challenge we face daily is that when a customer walks into any of our boutiques, we need to ensure that the service we offer that client is what they expect, and that it is also personalised. Very often the first luxury maison to enter a market is Montblanc. We have a price range for our leather goods, watches and writing instruments that start [from a few hundred euros] and go right up to Eur2m for some writing instruments. 68

June 2022

Once the market that we enter is mature enough, we open a mono-brand boutique where we are able to display the entire collection and offer our full range of services including customisation, engraving or embossing.

anymore. If we look at the share of watch sales in our Dubai Mall boutique, for example, it is 50 per cent classic and 50 per cent sports watches. As a brand, you’re now challenged to work on both pillars all year long.

What are some of the watch trends that you’ve observed in the markets you look after?

How do you strategise for the different pillars?

I’ve been in the industry for about 20 years now. Previously, every year we noticed a theme – say sports watches, and all the brands would showcase sports watch novelties. The next year would be classical watches, and everyone would present classic watches. Today, we don’t have that

We have over 70 countries in the region, and Montblanc is present in 36 of them. Obviously, we can understand that the client in India is not the same as that in South Africa, Greece or Dubai. We need to localise our offerings, the architectural design of our boutiques, and even do limited editions for certain countries within the region. We gulfbusiness.com

Lifestyle / Horology Franck Juhel, president of Montblanc Middle East, India and Africa

need to stay within the framework of the maison globally. A customer needs to find the same level of service irrespective if they are in Madison Avenue in New York, Champs-Élysées in Paris, the Dubai Mall or in the Kingdom Centre mall in Riyadh. Watches and Wonders evolved from SIHH and brought with it new brands this year to the show. How has that changed for you at Montblanc?

The watch industry is one family the same way the automotive world is. It is not very different for us with the new brands coming to the show, but for our business or media

“A customer needs to find the same level of service irrespective if they are in Madison Avenue in New York, Champs-Élysées in Paris, the Dubai Mall or in the Kingdom Centre mall in Riyadh”

partners, it does get more difficult for them to see those many more brands over the course of the week. You’ve signed up the amazing Nims following his brilliant Project Possible and Netflix documentary. How involved was he in the development of the 1858 Geosphere Chronograph 0 Oxygen?

The timeframe to develop this watch was quite long, and he was not involved with it in the beginning. But later on, Nims got involved with the project and he is testing it in extreme real world weather conditions. His testing of the timepiece will ensure that

what we are saying about this watch is not just marketing [talk]. The new 1858 GMT has a very novel way of showing the second timezone. Did you introduce the half-hour marker in response to one of your biggest markets, India?

We introduced it because it is a very practical function and not for the Indian market specifically. gulfbusiness.com

June 2022

Lifestyle / Horology

“When you are rich with so many archival references, instead of presenting 15 new models we could present 300 pieces from the archives and every single one of them would be relevant” Given the unavailability of stainless steel sports watches from certain brands, we are seeing many other brands offer amazing alternatives. Will we see a Daytona-inspired watch from Montblanc anytime soon?

There is only one Daytona and it’s made by Rolex, and there is only one Nicolas 70

June 2022

Rieussec and it’s made by Montblanc. Are you going to find similarities to the Daytona of Rolex in other maisons? Yes, obviously. After 200 years of watchmaking, there are bound to be similarities in design [across brands]. The way that brands differentiate themselves is in the materials they use. gulfbusiness.com

Lifestyle / Horology

Lecamp who is the head of the watch category at Montblanc and who joined us last year. He was impressed by the beauty of the Minerva movement and said that all he had to do was showcase that movement through the dial rather than the caseback. Sometimes, the easiest and simplest ideas are ones that nobody has done before. You are world renowned for your writing instruments and leather goods. How are the two categories performing in the Middle East?

British mountaineer Nimsdai Purja

The glacial inspired Iced Sea Automatic continues the stainless steel sports trends in the market. Tell us about this collection.

Each dial in the collection is unique and we are the only ones to use the gratté-boisé technique to make the dial in the same way we are the only ones to use a specific technique to make the back in this case without colour, and on the Oxygen model with colour. The laser is used at a certain temperature and the colour on the back doesn’t disappear; it becomes a part of the material. You’ve raided the Minerva archives with your Minerva Monopusher Red Arrow LE88. Will we be seeing Montblanc growing its pilot’s watch range?

In our region, all the categories are growing. Obviously the first category is and will always remain writing instruments. The second category is leather and we just launched a couple of weeks ago a designed collection by our new creative director Marco [Tomasetta] who is redesigning our entire leather line. After leather, our next category is watches. All the categories are growing and writing instruments is growing by two digits every year. The division of sales between these three categories remains the same as we had five years ago. Your Glacier Collection has brought all of your business units together. Is this a strategy whereby you can introduce your different customer segments to each other?

I think it’s more than a business strategy, it’s the Montblanc universe. We have very strong pillars and we are interconnected in everything we do.

I don’t think we will see a focus on pilot’s watches in the near future. We have a spirit of pioneers and exploration that we focus on. However, as everything comes from the archives and aviation was one of the main pillars of Minerva, you will see the designs that remind you of pilot’s watches. We are lucky to have a manufacturer like Minerva within our maison. We presented two new Minerva models this year – one limited to 18 pieces, and the other limited to 58 pieces. When you are rich with so many archival references, instead of presenting 15 new models we could present 300 pieces from the archives and every single one of them would be relevant. Talk us through the 1858 The Unveiled Secret Minerva Monopusher Chronograph.

The original idea came from Laurent gulfbusiness.com

June 2022

JUNE

The SME Story A dedicated hub for the regional startup and SME ecosystem

INTERVIEW

Primed for growth

We shine the spotlight on a UAE-based floral brand and an operational procurement startup that were quick to tap the gap in the market and steadily grow their business and client base What were some of the challenges you faced when starting out?

At the time there was very limited funding options and finding a suitable retail location was very challenging, as Bliss was new to the market and there were few completed real estate projects at the time in Dubai. Luckily, we had savings and also received funding from our families to launch Bliss. IFA Hotels also believed in us and offered us a location at its newly launched project on Palm Jumeirah.

What are the range of services offered by Bliss Flower and what is its differentiating factor within the market?

We are a full-service floral and events business. For B2C, we have walk-in retail, online, and wedding and event planning. For B2B, we have contracts with leading hotels in the UAE (Burj Al Arab, Address Hotels, Fairmont, Conrad) and many leading fashion and retail brands for their CRM programmes, events and instore activations.

Abbey Dean, co-founder and creative director, Bliss Flower Boutique

How did the idea for the company come about?

The idea started in 2007 while I was working as the head florist at the Jumeirah Beach Hotel. Michael and I (my business partner who was also working in Jumeirah Beach Hotel) saw a massive gap in the floral market in the UAE and we came up with the concept of Bliss to bring a European look and feel to the market. 72

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The SME Story

350,000 What has been your most extravagant customer request to date?

We recently completed a very high-profile wedding. There were 350,000 stems of flowers used in the project. It took 25 trucks to transport the flowers from the airport to the wedding venue. Seventy florists created the arrangements.

STEMS OF FLOWERS

USED FOR A VERY HIGHPROFILE WEDDING. IT TOOK 25 TRUCKS TO TRANSPORT THE FLOWERS

Give us an overview of the current scale of your business.

Currently, we have 13 retail units in the UAE (six are owned and seven are franchises) and one unit in Riyadh. We have 150 employees.

Further to that, we realised that clients sometimes face issues when it comes to payments, with the majority relying on purchase orders and frame agreements rather than using credit cards. We’ve structured easy payment plans to support our clients in such cases. Give us an overview of the current scale of your business.

Abdulhakim Albeshir, co-founder and CEO of Lawazem

What is the core concept and business model of Lawazem?

In less than 12 months we’ve acquired more than 100 long-term clients, with agreements to be their sole operational procurement partner. Our clients vary from SMEs and private and semi-government companies to nonprofit and government entities. Those clients drive more than 1,000 orders per month for their different daily operational needs. We also recently closed

Lawazem is an e-commerce marketplace designed specifically to fit business clients’ needs rather than those of consumers. It’s best described as a ‘B2B mall’ and a ‘onestop-shop’ for all business procurement needs, ranging from VIP guest services to office stationery. We offer businesses a broad range of services and products to choose from, decreasing the time, effort and costs of reactive operational procurement.

What are some of the expansion plans you have in the pipeline?

We launched in Riyadh in January and will be looking to open in Jeddah later this year. Qatar will be launching in July, so we are going to have a busy few months ahead.

a seed deal totalling $1.3m. The round was led by Merak Capital, a technology investment firm licensed by the Capital Market Authority of Saudi Arabia, with participation from Merced, a Saudi VC company that covers a variety of sectors across the Middle East. This investment will be pivotal for us as we move to further develop and enhance our technology as well as help in establishing the needed infrastructure to address the ever-growing demand for our products and services. What is the USP of Lawazem’s offerings?

At Lawazem, data is everything. We utilise our AI-driven business intelligence to list and showcase different kind of products and services that can be adapted to the market’s needs. Additionally, our variety of products and services give our clients choices to ensure the best with minimal effect. What’s the most important lesson about entrepreneurship?

Don’t stop even if you feel challenged. Take action and do something to drive growth and results. You should always persevere and push through hurdles with all your efforts or any resource you have. Tell us about your expansion plans.

“WE ALSO RECENTLY CLOSED A SEED DEAL TOTALLING $1.3M. THE ROUND WAS LED BY MERAK CAPITAL, A TECHNOLOGY INVESTMENT FIRM LICENSED BY THE CAPITAL MARKET AUTHORITY OF SAUDI ARABIA” gulfbusiness.com

We believe we introduced the world to the first operational procurement e-commerce platform. We have a very experienced team and the technology to complement this experience. So, we are definitely going global in the near future, utilising our strong local and international partnerships to drive our growth. June 2022

The SME Story INTERVIEW

four years and there are deals currently in consideration. We are closing deals every week. Out of the entire portfolio companies, around 25 of them turned into unicorns through the portfolio management of Binance Labs. These unicorns include Terra, Matic, Axie Infinity, The Sandbox, CertiK, Dune Analytics, My Neighbor Alice, League of Kingdoms, and 1inch, among others.

Investing in innovation Bill Qian, head of Binance Labs, tells Neesha Salian about the company's investment goals, how projects are incubated and why Web 3.0 is a key trend this year Tell us about Binance Labs and your investment goals in this region.

As the venture capital and innovation incubator of Binance, Binance Labs aims to identify, invest, incubate and empower viable blockchain entrepreneurs, startups and communities, and provide financing to industry projects that help grow the larger blockchain ecosystem. We are keen to support fast-executing teams who positively impact the crypto space. Binance Labs is an important member of the Binance ecosystem because it explores and invests in the most pioneering projects and founders, eventually bringing the innovations to the existing landscape. Currently, we are looking for investments in projects all around the world. For the MENA region, we are aiming to invest in at least 10 projects in the next nine months. What are some of the key trends in crypto and blockchain that we should be paying attention to?

As many people are aware, DeFi (decentralised finance) and NFTs (nonfungible tokens) have been the big trends since last year. For this year, we believe that Web 3.0 could be the key trend. We are at the beginning of the Web 3.0 74

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How do you choose which projects to invest in?

We consider many elements when investing. Primarily, we see if the projects that we consider for an investment can affect the adoption of users and the industry. This also shows how the projects can impact the world. Furthermore, we try to predict the reactions of users when they first encounter the services. Lastly, we try to see if this project can be sustainable in the next 10 years and stand alone. Any tips for startups looking to get onto your radar and be incubated? Tell us about your incubator programme.

era, which combines the decentralised, community-governed ethos of Web 1.0 with the advanced, modern functionality of Web 2.0. Web 3.0 is the internet owned by the builders and users, orchestrated with tokens (so called crypto). How is the company contributing to the growth of the crypto and blockchain ecosystem?

Binance Labs has invested in more than 150 portfolio companies for the past

Binance Labs runs an incubation programme on a regular basis, twice a year, including an offline ‘Demo Day’, which only happened online for the past two years due to the pandemic. We are now almost done with the due diligence of the applied projects for Season 4 of the incubation programme. Those who are interested in Binance Labs’ programme can apply for the upcoming season. Those who get selected as part of the programme can leverage the Binance brand to build a network with investors and industry players. Tell us about how the company’s goals tie in with the larger vision of Binance.

Backed by the global network and extensive Web 3.0 expertise of the world’s leading crypto exchange, Binance Labs has a vast and deep global presence in the crypto ecosystem. With the resources we have, we believe we can nurture and incubate projects that can potentially bring the freedom of money for all. gulfbusiness.com

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