How would you describe the current climate for investment in the UAE? How well is Waha Capital positioned to capitalize on future opportunities?
AL NOWAIS: If we want to talk about investment in the UAE, we need to look at the investment environment. I think we have come a long way. Processes, systems, regulations, we've got the framework for attracting investment. We now have a way of doing business that is faster and more efficient than before.
The different Emirates have different engines of growth. There are also some common ones for the whole country, but there are specific ones. If I want to mention a couple that are different, for example, in Abu Dhabi, the major engine of growth is government expenditure. The government is spending on infrastructure, on industries, on oil and gas, on energy, and that reflects into these sectors while developing other supporting sectors. It's a cluster concept, which brings in other businesses and other industries.
There is also a drive toward tourism. The investment in the Louvre Museum, the investment in the Guggenheim Museum, the investment in Saadiyat Island, Yas Island, Reem Island, all these have been an attraction for tourism in terms of facilities alongside the Ferrari World and the theme parks.
If you move into Dubai, obviously tourism is a major attraction. Dubai attracted 10 million tourists last year. Dubai has become a platform for services for the region. The UAE has succeeded in becoming a regional hub for businesses, for investment, for transport, for cargo. We have a strong logistics infrastructure; a big, major infrastructure. All of these factors attract people to come to the UAE, and to invest in services, in industry, in real estate.
Waha is at the forefront of that. Waha has invested in infrastructure for logistics through Waha Land. Waha has invested in financial services through Dunia. Dunia is an important engine for SME growth, which has been a strategic focus for this country. SME are part, an important part, of the economy. With Dunia Consumer Finance for SMEs, this is an engine of growth for Waha.
We're investing heavily in the marine sector, which is an engine of growth for oil and gas. There are more investments in offshore oil and gas, in Abu Dhabi, in Qatar, and in other countries in the region, which present an obviously an opportunity for the Waha subsidiary Stanford Marine.
Healthcare is another area. With the growth of the population, you need more healthcare providers. The government philosophy is giving the private sector the leadership position in healthcare and education; the heavy investment in social infrastructure, where the government wants to slow down and let the private sector do it, all this provides opportunities for Waha Capital. Hence, Waha has invested in healthcare through Anglo Arabian Healthcare. Education is another area Waha is looking at. So we feel these opportunities will be the right ones for growth in the future within Waha Capital.
How do you see the investment landscape evolving in the region in the coming years? What is Waha Capital’s strategy for the GCC?
I'm very optimistic about the growth potential for the region, despite certain security issues that some Arab countries within the greater Arab world are facing. But the UAE and Saudi Arabia are the two largest economies in the Arab world and represent the bulk of the GDP of the Arab world. I think with that ability, we see high growth potential.
AL NOWAIS: I'm very optimistic about the growth potential for the region, despite certain security issues that some Arab countries within the greater Arab world are facing. But the UAE and Saudi Arabia are the two largest economies in the Arab world and represent the bulk of the GDP of the Arab world. I think with that ability, we see high growth potential. Obviously, oil remains a major driving force for the economy. The price of oil, if it continues to rise, will generate more income for the Gulf countries and therefore generate more opportunities and more investment in infrastructure, housing, and social infrastructure.
The trend, the forecasts and the projections, whether from the World Bank, the IMF, major institutional investors, or the banks of this world, all are positive. Obviously, the growth in America and Asia help. This is an integrated world. We can no longer say we are isolated from or immune from difficulties. When the world has gone through difficulties in the last few years, we had challenges as well, so we're not immune from that. But the picture looks rosy everywhere. It looks rosy in the United States, it looks rosy in Asia, and even Europe has started to look rosier than it used to a few years ago. I think being in the geographical location we're in, being a partner for all these major global economies, we will all benefit. I believe the next few years will be great years for Waha Capital in particular, and for the economy of the Gulf in general.
Another dimension in Waha's strategy has been to focus beyond the UAE to the rest of the Gulf. I'm sure you realize that the Gulf has become an integrated economy. Waha Capital is based in Abu Dhabi, based in the UAE, which is the centre for the Gulf economy. We're looking for opportunities elsewhere in the Gulf. Saudi Arabia in particular is a market we are very keen on. The Saudi economy is a big economy. It's growing very fast, and we feel that Waha Capital is well positioned to take advantage of that growth opportunity in Saudi. Other regional Gulf partners, Qatar, Kuwait, Oman, Bahrain, certainly present good growth opportunities for Waha as well. Whether it is education, marine, or consumer finance, all these are businesses that are expandable; we can build on them within the regional platform. That integrated market does certainly encourage us to position ourselves for the region as a whole.
How has the continued development of the UAE’s capital markets impacted the exit strategies for Waha Capital’s investments?
AL NOWAIS: The business model on which Waha Capital has been built is as an investment company and obviously looking at opportunities which have a growth potential. We invest our own money. Sometimes we go in with partners. The exit strategy for this investment, the one we have in mind today, is looking at the capital market. The capital market has been a mature market, it is growing. The natural exit for some of the opportunities we invest in is through listings. This will hit two birds with one stone; it will generate profit for Waha when we exit, and it will help to build a better capital market for the country, as a region. The expected merger of the two stock exchanges in Abu Dhabi and Dubai will definitely play a role there. It will give us a better prospect; we believe some of the companies we have invested in, when the time is right, when the size is right, when the profit is sustainable, which is imminent, listing is an option which will generate profit for everyone.
What distinguishes Waha Capital form other regional investment companies?
AL NOWAIS: We'll be focusing on identifying and developing young nationals, providing a training program for them, shadowing them with experienced expats, so they become ready to take on good positions, leadership positions, and heads of department positions. As an investment company, our number one factor is our human capital. Good people make good decisions. Market opportunities obviously are another important factor, but the right people can see the right opportunities. The right people make the right decisions, and the right people select the right people to work for them. So our focus at Waha Capital has been the development of human capital through nationals, young nationals who are well educated, talented, passionate, committed, and energetic, and developing them to be the leaders of the future for Waha.