Dubai-Mubasher: Respondents expected the small and medium enterprises (SMEs) sector to grow in Q3-16, according to a sentiment survey conducted by SHUAA Capital’s SME financing subsidiary Gulf Finance in Q2-16.
The cautiously optimistic growth outlook was mainly attributed to factors such as macro risks and economic weakness are lower than in Gulf Finance’s previous survey and banks restarting to lend.
A higher proportion of respondents reported orders received in Q2-16 were higher, 77% versus the 62% reported in the first quarter, and slightly down from 79% in Q2-15.
The SMEs market is starting to recover from lows seen at the end of 2015 and early 2016.
Around 80% of respondents indicated a strong increase in their companies’ ability to raise funds Q2-16.
Despite the cautiously optimistic outlook, only 14% of respondents added to their headcount in Q2-16 and only 18% have plans to add Q3-16.
“Despite the market normalizing after a weak first quarter, it remains challenging,” Gulf Finance CEO David Hunt said, adding that “recruitment is falling short, dampening enthusiasm for business expansion.” “Growth expectation will remain modest until the year end unless companies unlock their hiring freeze,” Hunt added.
