Finance Industry Update Q1 2016

Finance Industry Update Q1 2016

Despite many of the world’s financial markets slowing down, the finance sectors of the Middle East are forecasting a positive outlook as we enter into 2016.

Typically within emerging markets, pressures such as political turmoil and low oil prices restrict the industry’s progress. However, several underlying factors- such as UAE Expo 2020 and the 2022 World Cup in Qatar- will ensure that this region’s financial markets remain buoyant for the foreseeable future, with a regional GDP expanding at an annual average of 4.1%.

The Gulf nations in particular will be the focal point in driving growth throughout the region. These states are relying on years of strong hydrocarbon profits to build national infrastructures and provide robust and diversified economies for continued sustainable growth.

What to expect

Qatar is expected to be the one of best performers in 2016, followed by Iran. Iran’s growth is attributed to the belief that the country will greatly benefit from the removal of economic sanctions.

The performance of the financial sector, particularly in terms of loan growth, asset quality and profitability, are expected to remain strong in 2016. A key factor to these resiliency is the support from regional governments to uphold countercyclical spending policies.


Credit growth is anticipated to be in the range of 4-10% in 2016. A decline in private sector loan growth will be tempered by new government borrowings from local banks; this will assist to support profitability and margins.

Inflation in the Middle East has declined to the lowest rate in more than a decade. Low energy and food prices coupled with a protracted global economic recovery are exerting downward pressure on prices.

Going forward, commodity prices will remain low for the foreseeable future. Weak currencies in some nations and anticipated increases in administrated prices across the region are likely to slightly boost inflationary pressures. Financial analysts see regional inflation averaging 4.7% in 2016.


If oil prices continue to remain depressed over a long period of time, this will inevitably result in significant fiscal adjustments to cope with the sustained fall in revenues. This in term will have an adverse impact on the finance sector in terms of asset growth and profitability.

Job Outlook

Banking salaries across the Gulf region are projected to rise by 5% on average during 2016, according to a new survey by Aon Hewitt.

Kuwait-based companies are likely to give the highest salary increase for 2016 at 5.2%. Firms in Saudi Arabia forecast a 5.1% figure for 2016 UAE firms projected a 5% increase in pay in 2016. This is up from the 4.8 % projection made for 2015. Qatari and Omani firms estimated are also estimated for 5% salary growth for 2016, although each of these projections are lower than their 2015 predictions (which stood at 5.2% and 5.4% respectively). Meanwhile, companies based in Bahrain are estimated to provide the lowest increases in the Gulf region, at 4.7%.

There are certainly positions available in the coming term. To capitalize on these opportunities, it is simply a matter of getting your CV in the right place.

If you would like assistance in finding such positions, then upload your CV below and be appointed your very own personal job hunt manager who will help ensure your CV gets under the nose of the right recruiters and headhunters who have finance-related vacancies they need to fill!

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