A big thanks to the Global Trader Magazine for the interview below. You can read the rest of the magazine here (you can also download as a PDF)
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It’s hard to know where to start an article on doing business in the Middle East without immediately threatening to overrun the allotted word count.
The region has long been a commercial beacon for British firms and the future outlook is similarly positive. The very recent $7 billion order that Rolls-Royce PLC announced to power Emirates Airlines’ next batch of A380 jets is a very obvious and current example of thriving trade between the UK and the region, and for every mega-deal of this nature there are myriad untold commercial successes where British SMEs are winning business and growing exports in the Middle East on a daily basis.
Looking at the Middle East from the UK, there are a number of uniform high-level commercial elements across that should be highlighted in order to give general guidance and context for British companies who are looking to expand or export in the region.
- The Middle East’s economy is founded on the bedrock of energy exports and will continue to be for many years to come, regardless of fluctuations in the oil price. Countries across the region have built up large fiscal cushions that can be deployed to even out the ebb and flow of the energy markets, meaning that economic growth and development will continue.
- In order to reduce long term reliance on oil and gas, governments across the GCC are investing significant resources in diversifying their economies into other sectors and industries.
A major catalyst for this diversification is the massive investment in infrastructure projects throughout the region. Money earned primarily through oil and gas exports is being recycled into developing capacity in other parts of the economy. - Allied to this investment in ‘hardware’, governments are increasingly focused on developing their human capital. There is a major push towards increasing private sector employment opportunities for the local population and British companies with serious long term aspirations should embrace this.
The region is firmly Anglophile. There is an inherent fondness for the UK, its institutions, companies and culture and demand for British goods and services is strong. - Business is done face-to-face across the Middle East. Don’t expect speedy answers to emails, but do expect visits in person to yield long term results. Building business in the region requires patience, commitment and a local presence to be truly successful
Don’t expect speedy answers to emails, but do expect visits in person to yield long term results. Building business in the region requires patience, commitment and a local presence to be truly successful.
There is, of course, also a common language across the region (and English, fortunately, is very much established as the second language and the common international business tongue); the Muslim faith also provides a singular theme that runs across the region and it behoves all UK firms to become aware of Islamic culture as a positive means of understanding and developing business.
However, despite these high-level regional similarities, the most common error that British companies tend to make when approaching the Middle East is believing that the region is a single homogenous entity with identical business practices across its constituent countries. Just as business across the EU is done in different ways, the GCC are very particular and individual in their respective ways of approaching commerce and trade.
Given this disparate and perhaps complex picture, how do British firms develop business in the Middle East? Where do they start? Obviously, British Embassies and missions in the area all have significant UK Trade and Investment (UKTI) resources that UK firms can tap into. The last year has seen the launch of four new business-to-business advisory organisations across the Gulf to provide practical support to British companies, particularly SMEs.
The British Chambers of Commerce and UK Trade & Investment are working together to create an international business network, providing practical support for UK exporters. British companies now have access to onthe-ground commercial guidance and assistance in the UAE, Kuwait, Qatar and Saudi Arabia.
Each of these entities has a very simple mandate – to help British companies grow in the region – and they have been established in response to the growing activities and demands of British SMEs operating in the region. Indeed, whilst it is the likes of Rolls-Royce, BP, Shell, HSBC etc. who are the most visible manifestation of British business success in the region, it is in the SME sector where there is undoubtedly the greatest momentum and opportunity.
