Canadian Treasurer

March 19, 2012

Middle East finance professionals optimistic despite dollar liquidity challenge

DUBAI--Senior financial and treasury professionals in the Middle East feel that the liquidity of the dollar will have a negative impact on their funding.

This was the result of the "Treasury Verdict" session taken by a live audience poll of senior treasury and finance professionals at EuroFinance's conference on Trade, Treasury and Cash Management in the Middle East held in Dubai, UAE. The session is sponsored by J.P. Morgan Treasury Services.

When asked if the liquidity of the dollar is going to have a negative impact on their funding, a notable 78% of participants replied that it would in some way.  The level of impact varies, with 19% saying it has "considerable impact" and 43% registering "some impact". And while some are not experiencing an impact, 16% note that they expect it to.

Despite the dollar liquidity issue, finance professionals in the Middle East are bullish about the prospects for their company's business in the coming 12 months. A resounding 73% are optimistic about their performance, which places the Middle East third in the Treasury Verdict optimism ranking, only trailing results from the Brazil (85%) and Mexico (82%) events.

When it comes to the most important global areas for company growth, Middle East finance professionals plan expansion close to home, with 78% choosing the Middle East and Africa. The business being conducted out of the Middle East into Africa puts the region into direct competition with Asia. In addition, while 19% of Middle East finance professionals want to grow their business in China, the rest of Asia was a more popular destination with 30% participants citing this as an important growth area.

Katharine Morton, EuroFinance's Managing Editor, says "The dollar liquidity issue is certainly a matter of concern for companies’ ability to fund going forward. But it’s good to see that that’s not denting overall bullishness. And it’s particularly encouraging to note that companies will be looking to expand in Africa and the Middle East. "



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