Dr. Seetharaman also highlighted the trends impacting infrastructure development in the region: “With the implementation of the four-year plan in Kuwait in financial year 2012-2011, Kuwait is firmly positioned at the business end of completing its current strategic plan which will contribute to meeting the goals and objectives of the vision for 2035. Government expenditure continued to rise in FY 2011-12, with an increase of 8 per cent according to the IMF. The budget expansion was more than offset by an increase in oil revenue of an estimated 35 per cent. Non-oil growth of the economy in 2011 was calculated by the IMF at around 4.5 per cent with investment and real estate sector firms registering a somewhat subdued period. However real estate transactions recovered in the residential segment, outperforming commercial property. The IMF predicts the government will have a positive approach and expects an increase in government spending of around 15%. Non-oil activity will, as per the same calculations, be around 5.5% in 2012 and fiscal and external surpluses are expected to remain strong for the period. The IMF update issued in April this year a 4 per cent growth forecast in non-oil GDP in 2013 as the development plan is expected to be implemented more rapidly. This is a very positive sign for all players in these markets seeking long-term opportunities in Kuwait.”
Doha Bank Group CEO, Dr. R. Seetharaman said that one of the key considerations Doha Bank Kuwait Branch makes when establishing partnerships with clients is bringing together a core team of experts as part of knowledge sharing process. This knowledge sharing session will enable our customers to be abreast of the significant developments in property and infrastructure development in the country.
Dr. Hamad Al-Hasawi, Secretary General of the Kuwait Banking Association, also spoke at the summit: “Major real estate projects improve the competitiveness of the overall economy, expand the absorptive capacity of the country, create new jobs and increase employment levels. They also increase the value added in the overall economy, support growth in non-oil GDP and improve the overall welfare of the society. There are many positive contributing factors that can lead to a positive outlook for real estate and infrastructure projects in Kuwait. These include the structural disequilibrium of the housing sector in Kuwait, high population growth and the abundant liquidity in the market that will promote investment. Hareer City, for example, is primed to house more than 700,000 inhabitants in a 250 sq. km area, with a budget of around KWD 25 billion ($ 88 billion) in direct costs envisioned for this project alone.” Dr. Al-Hasawi also highlighted the need for greater public private partnerships to make such mega projects possible.
Mr. Sven P. Gade, Group Chief Executive Officer of PKF-The Consulting House, had some interesting insights into project efficiency: “The majority of project failures are due to incomplete development program definitions. We believe in “Business-led Design” which requires a solid Business case first before green lighting any design activities. The business case is best established by independent business advisors covering Highest & Best Land Use Assessments (HBU), a land assessment and destination program, followed by a fully-fledged Market & Financial Feasibility Study (MFFS).To avoid financial failure or failure because of incomplete project definition, sufficient time between HBU and creation of concepts by designers should be allowed. Based on target markets and product positioning, it is essential to reach a fact based consensus with the designers on development program – including budgets. This should encompass every planned structure and land use intended for the site. The key take away is that designers cannot develop concepts or components without program definition.”
Mr. Massoud Bafti, a senior member of KEO’s PMCM International Division who is the Senior Risk and Opportunity Facilitator within the project control department of the consultancy said “ For companies seeking to be competitive and effective in a lucrative and competitive marketplace, it is also imperative to understand and manage risks and opportunities. This can decrease the probability or impact of negative events and increase the probability or impact of positive events. The commitment was essential as risks and opportunities need to be addressed proactively and consistently so that companies can communicate them openly and honestly. This is a multiple stage process and involves planning the risk management process, identifying risk and opportunities, performing specific qualitative and quantitative analysis, followed up by planning risk responses, and live monitoring and administration of controls to manage it properly. In such programmes, a standard scoring system is utilized that ranks risk by likelihood and impact to deliver targeted solutions. “
Mr. Ganesh Mohan, Partner and Managing Director at the Abu Dhabi office of The Boston Consulting Group who was also present at the summit in Doha said “The secret to superior economic performance is a combination of establishing and building on a sustainable competitive advantage and having a motivated and energized organization that is capable of going beyond the base essentials. Research suggests that benchmarked fortune 1000 companies demonstrate that economic factors contribute just 18% of actual profitability at these companies as opposed to a comparatively large 38% of various organizational factors that contribute directly to company profitability. “
Doha Bank Group CEO, Dr. Seethraman concluded the summit by thanking the guests that had attended and by also thanking the guest speakers for demonstrating the key synergies that exist between Doha Bank and their respective organisations that can prove extremely beneficial to Doha Bank’s corporate clients.