Top executives in the UAE, Saudi Arabia and Qatar say business conditions have improved since last year, but views are mixed about the long-term effects of regional uprisings on business confidence, according to a survey.
In the survey, conducted by Oliver Wyman, a consulting company, and Zogby, a polling firm, executives said external economic shocks constituted the biggest single threat to the GCC's business environment.
About 36 per cent of respondents from the UAE cited macroeconomics as the most pressing risk, while 34 per cent from Saudi Arabia and 40 per cent from Qatar said the same. But a central line of questioning in the latest Wyman-Zogby poll - the fourth in a series begun in October 2009 - was the role recent uprisings would play in prospects for the region's businesses.
The survey found divergent views, with almost half of executives in the UAE citing the unrest as the biggest threat to the GCC and the wider Middle East. Only 27 per cent of Saudi executives and 16 per cent of Qatari executives agreed with that view.
While executives in the UAE were more concerned than their Saudi and Qatari counterparts about the unrest, they were evenly divided about the long-term effects of the upheaval. Just under a third said the turmoil would have a positive long-term impact on the UAE; 33 per cent said the impact would be negative.
"[High-ranking] executives are definitely aware of the turmoil elsewhere, but are focused on tackling the big issues at home," said John Turner, the head of public-sector consulting for Oliver Wyman in the region.
Domestically, the main worry appears to be educating and finding jobs for throngs of young people, the survey found.
In the UAE, 58 per cent said they were either "somewhat concerned" or "very concerned" about the number of youths entering the labour force. The total was highest in Saudi Arabia, where 83 per cent expressed concern. Among the 164 executives surveyed, education reform and labour reform were consistently cited as the issues requiring the most urgent attention and posing the greatest long-term threats.
Those reforms were cited more than twice as much as judicial reform, banking reform, and improvements in transparency and infrastructure.
"What to do with so many young people who need training and jobs, and who should take the lead - government or the private sector - remain real questions to be answered," Mr Turner said.
Overall, executives in the poll said current business conditions were better now than a year ago.
About 57 per cent in the UAE said conditions were better, a far higher figure than the 15 per cent who said so in October 2009.
Looking into the future, optimism was even stronger.
About two-thirds of executives in the UAE said they expected conditions for business to improve in the next two years.