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B usiness Optimism Index Qatar Q2 2009

B usiness Optimism Index Qatar Q2 2009. Presented by Dun & Bradstreet Qatar Financial Centre (QFC) Authority Al Khalij Commercial Bank (al khaliji). Business Optimism Index.

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B usiness Optimism Index Qatar Q2 2009

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  1. Business Optimism Index Qatar Q2 2009 Presented by Dun & BradstreetQatar Financial Centre (QFC) Authority Al Khalij Commercial Bank (al khaliji)

  2. Business Optimism Index • The D&B Business Optimism Index is recognized world over as an indicator whichmeasures the pulse of the business community • Provides insights into theshort-term outlookof the business community on investment, sales, profit, growth, etc. • Analysis of major trends, outlook and issues concerning the business community • Widely used by policymakers and investors forassessment of business sentiment • Over time gives composite index which emerges as a leading business indicator of turning points in economic activity

  3. Survey • Sample of business units representing the Qatari economy • 500 business owners and senior executives across business units surveyed • Survey conducted in March 2009 for the quarter end April 2009 • Respondents questioned on their expectations for relevant business parameters • Hydrocarbon sector survey conducted separately • Also surveyed respondents regarding current business conditions vis-à-vis: investment plans, industry concerns, impact of the global financial crisis, etc.

  4. Business outlook low key • Business sentiments plunge as compared to last quarter • A marked decline in profitability expectations • Inflation to recede further

  5. Uncertain demand conditions Volume of Sales New Orders Volume of Sales • Sales volume and new orders seen declining • Most real estate businesses expect a decline in sales

  6. Profitability outlook weakens • Building, construction and real estate sector takes a hit • Financial enterprises treading cautiously

  7. Business units cautious on costs Level of Stock Number of Employees • Most business units to maintain inventory levels to that of last quarter • Hiring plans on hold amid uncertainty regarding the global economic condition

  8. Prices expected to decline further • Selling price index dips to -18 as compared to 8 in last quarter • Biggest respite to come from real estate sector

  9. Cost of Capital • 54% of the business units expect cost of capital to stabilize in the second quarter

  10. Oil and Gas Sector Net Profits Number of Employees Level of Selling Prices Cost of Operations • Selling price index recovers from the low of -54 for the last quarter • Cost of operations expected to decline

  11. Factors affecting the business Non-hydrocarbon Oil & gas • Availability of finance a major business concern for the non hydrocarbon sector • Drop in oil prices is a major threat to the hydrocarbon industry

  12. Global economic recovery Non-hydrocarbon Oil and Gas • Most business units expect global economy to recover in year 2010

  13. Outlook for Q2 2009 • Business optimism takes a hit amid deepening global recession • Demand outlook remains subdued for the second quarter • Profitability plunges across all sectors • Inflation expected to decline further, BOI for selling price dips to -18 • Business units remain cautious about holding inventories • Cost of capital is anticipated to stabilize • Slight improvement in sentiments of hydrocarbon sector

  14. THANK YOU

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