Nestle expects a rebound in it business in the Arabian Gulf but it may not match the level of activity before the collapse of oil prices in 2014, said its regional chief.
“We continue to forecast positive levels of growth [in the GCC], not necessarily what it used to be five or six years ago when the region was under a different overall economic context,” Yves Manghardt, Nestle chairman for the Middle East told reporters in Dubai on Tuesday. “But we remain very positive and see signs of recovery in some of the countries which have been more recently affected by the economic restrictions.”
Mr Manghardt said that the growth in sales of its products in Saudi Arabia – which account for about 35 per cent of its regional business – had been “softer” in the past two years, as lower oil revenues impacted the wider economy.
“Subsidies had to be lifted by the government and, for consumers, purchasing power was not as positive,” said Mr Manghardt. “We see that we should be able over the coming few years to go back to an increasingly positive growth.”
Mr Manghardt spoke to reporters following the official opening of Nestle’s Al Maha factory in Dubai South.
The new factory, which produces Nescafe 3-in-1 coffee and Maggi soups and stock cubes, was opened by Sheikh Ahmed Bin Saeed Al Maktoum, the president of the Dubai Civil Aviation Authority.
“Nestle has been the early mover to Dubai South having realised its potential as the economic platform for the future,” said Dubai South’s executive chairman, Khalifa Al Zaffin.
“They have leveraged our excellent infrastructure and ease of doing business to further grow their business. We’re delighted to see Nestle growing stronger in the region.”
The Al Maha Factory, which began initial production in early 2016, allows for the production of up to 31 kilotonnes of Maggi stocks and soups and 23 kilotonnes of coffee mixes per year.
The factory is Nestle’s third facility in the UAE and its 18th in the region.
jeverington@thenational.ae
Follow The National's Business section on Twitter
