JANUARY 2019 #144 THE GUIDE TO GOOD BUSINESS AND BETTER LIVING UA E AED 20 BAHR AIN BHD 2 KUW AIT KWD 2 OMAN OMR 2 JA N UA RY 2019 STAR OF 2018 SHEIKH MOHAMMED BIN FAISAL BIN KHALID AL QASSIMI LEADS THE FORWARD-THINKING BUSINESS LEADERS WHO MADE A DIFFERENCE IN THE EMIRATES THIS YEAR N OMR 2 JAN UAR Y 20 19 SHEIKH M BIN KHALI FORWARD-T WHO MA EMThe home of HEARTFELT EVENTS Where place meets purpose, with an exceptional setting as the backdrop for your next event, surrounded by Arabia’s ancient Hajjar mountains. Host meetings that inspire big ideas in venues designed for success, stage events that create tomorrow’s stories. Merge business with sports and leisure on a platform for adventure-themed team building activities, from kayaking around the Hatta Dam, hiking to a peak of impressive views, to biking along a rugged trail, ziplining, wall experiences with JA Hatta Fort Hotel. For bookings or more information, please call +971 4 8099 333 or email hfh@jaresorts.com4 C EO M I D D L E E A S T JA NUA RY 20 19 8 IN 5 Business 08 BIG PICTURE SAUDI ARABIA HOSTS HISTORIC FORMULA E CHAMPIONSHIP 09 NEW S UAE GIANTS INK POWER DEAL SAUDI ARAMCO INVESTS IN SECURITY INVESTCORP LOOKS TO INDIA WATANIYA AIRWAYS BANNED 16 CE O CO A C H DOES CULTURE TRUMP STRATEGY IN TERMS OF IMPACT? 19 10 IN 5 MUHAMMAD CHBIB (EX-TAJAWAL) PHILIP BAHOSHY (MAGNITT) EMMA BANKS (JUMEIRAH RESTAURANT GROUP) PETER SKUDUTIS (ZERO GRAVITY) PATRIA PUYAT (HOLIDAY INN) VALERIE REYNAERT ( SISTERS BEAUTY LOUNGE) RICHARD ZINKANN (MIELE) LEILA SANI (THE GROOMING COMPANY – 1847 AND N.BAR) 33 THE PAST PORTENDS THE FUTURE MUHAMMAD CHBIB (EX-TAJAWAL) PHILIP BAHOSHY (MAGNITT) ALAIN BEJJANI (MAJID AL FUTTAIM) ABDALLAH MASSAAD (RAK CERAMICS) SUNIL KAUSHAL (STANDARD CHARTERED BANK) HAITHAM MATAR (RAKTDA) REED HASTINGS (NETFLIX) AMNA AL OWAIS (DIFC COURTS) HRH PRINCE KHALED BIN ALWALEED BIN TALAL (KBW VENTURES) TARIQ AL GURG (DUBAI CARES) ARNE SORENSON (MARRIOTT) 54 FEATURE MALABAR GOLD HAS A UNIQUE BUSINESS MODEL, ONE WHERE EVEN EMPLOYEES ARE SHAREHOLDERS Pleasure 59 PLE ASU RE N E WS SOTHEBY’S PLANS DESERT ART OASIS 61 ALWAY S ON T I ME PARMIGIANI, LONGINES, OMEGA 64 STAY THE ARCH LONDON 66 BUSINESS L U NCH FOGO DE CHAO contents 19 61 8 64 January 2019 66 9 16 54 33 THE PAST PORTENDS THE FUTUREJA NUA RY 20 19 CEO MIDDLE E A ST 5 HIS YEAR BROUGHT BACK MEMORIES OF Will Ferrel’s Saturday Night Live impersonation of President George W Bush, when he famously (and hilariously) termed ‘the economy’ one among the number of the Axis of Evil. What began as a promising year (according to some) quickly turned into one that continued to leave a sour taste as it limped toward the finish line. It was most evident when speaking with Marriott’s Arne Sorenson about the global economy. In the third quarter of the year, Sorenson was generally confident that US fundamental indicators showed strength, and that while the rest of the world looked shakier, that pockets of growth in emerging markets were still to be found. Just a few weeks later, the hospitality giant found itself contending with the second largest data breach in history. Meanwhile, as 10 year US bond yields crossed lower than those on two-year treasuries, panic driven investors abandoned any attempt to mimic the confidence the world’s biggest hospitality CEO had earlier dared; in December, they plunged the S&P 500 into bear territory, and wiped a whole year’s worth of gains off the Dow Jones Industrial Average. When writing this, late in December, US stocks had recovered to post their largest single day rally in history. But does that mean the market was oversold? Or will stocks in 2019 echo oil’s fortunes in 2018? Because at one point speculation raged if a steadily climbing crude would once again cross $100 for the first time in half a decade. Mere weeks later, it was languishing below $50, threatening any revenue windfall Middle East exporters were hoping for. Some emerging markets show signs of promise. 2017’s best, and 2018’s worst performer, Pakistan could present a fundamentally stronger case to reserve more funds for emerging market investments if it can solve its financing woes. Deferred payment agreements and resuscitation efforts by Saudi Arabia and UAE seem to have stymied its current account deficit. Unfortunately, it’s currency, like those in Turkey, India, and others has taken a battering, and could continue to do so if the dollar grows stronger. Emerging markets overall brought pain for investors in 2018. But while Bloomberg analysts say they’ll bring more heartache in 2019, CNBC begs to differ, saying the reformists they’ve elected could spark a revival. What is for certain, however, is that if a bear market were to rage on for longer, and a recession in either of the two world’s largest economies were to result as of a trade war truce falling through, 2019 won’t bring cheer to anyone. ON BEING CAUTIOUS ABOUT THE NEW YEAR CEO Coach Why strategy matters but culture counts in an organisation PAGE 16 Growth trick Productivity growth is slowing, but keep- ing the right friends can help PAGE 28 Star of 2018 Sheikh Mohammed bin Faisal bin Khalid al Qassimi is among the most prominent Emirati businessmen of the year PAGE 30 Inclusive business Malabar Gold has grown from one outler 25 years ago to 250 around the world. As it plots to triple that number, we reveal how it’s unique business model helps it grow PAGE 54 Always on time The best timepiece designs to kick off the New Year PAGE 61 London’s arch It hits all the right spots if you’re a traveller in the mood for some luxury, but even more so for Middle Eastern guests PAGE 64 Business lunch Fogo de Chao continues to impress, but this time it’s outdone itself PAGE 66 MUST READS THIS ISSUE shayan.shakeel@itp.com SHAYAN SHAKEEL Editor, CEO Middle East Like the magazine? Hate it? Either way, let me know: QU ESTI O N S? CO M M E NTS? FROM THE EDITOR T6 C EO M I D D L E E A S T JA N U A RY 2019 To receive your copy delivered directly to your door, subscribe online at www.itp.net/subscriptions The most important business people and CEOs talk to the most important magazine The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication which is provided for general use and may not be appropriate for the reader’s particular circumstances. The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review. ITP MEDIA GROUP CEO ALI AKAWI MANAGING DIRECTOR SUE HOLT EDITORIAL EDITOR SHAYAN SHAKEEL Tel: +971 4 4 4 4 3845 shayan.shakeel@itp.com SUB EDITOR EDWARD LIAMZON CONTRIBUTORS LUBNA HAMDAN BERND DEBUSMANN JEREMY LAWRENCE NEIL HALLIGAN EVENTS & MARKETING DIRECTOR OF AWARDS & MARKETING DANIEL FEWTRELL TEL +971 4 4 4 4 3684 Daniel Few trell@itp.com EVENTS & MARKETING MANAGER JOANNA FARRER TEL +971 4 4 4 4 3328 joanna .farrer@itp.com ADVERTISING HEAD OF SALES - AGENCIES MARIO SAAIBY Tel:+971 4 4 4 4 3592 mario.saaiby@itp.com SALES MANAGER VINOD THANGOOR Tel: +971 4 4 4 4 3467 vinod.thangoor@itp.com DESIGN CREATIVE DIRECTOR ADRIAN LUCA ART DIRECTOR SAMIR AL GHAZAL PO BOX 500024, DUBAI, UAE TEL: +971 4 4 4 4 3000 OFFICES IN ABU DHABI, DUBAI & LONDON PHOTOGRAPHY SENIOR PHOTOGRAPHERS RAJESH RAGHAV EFRAIM EVIDOR RICHARD HALL STAFF PHOTOGRAPHERS LESTER APUNTAR AASIYA JAGADEESH AUSRA OSIPAVICIUTE GRACE GUINO FRITZ ASURO AJITH NARENDRA PRODUCTION & DISTRIBUTION GROUP PRODUCTION AND DISTRIBUTION DIRECTOR KYLE SMITH PRODUCTION MANAGER BASEL AL KASSEM PRODUCTION COORDINATOR IMAD AAD OUTSOURCING MANAGER AAMAR SHAWWA SENIOR IMAGE EDITOR EMMALYN ROBLES CIRCULATION HEAD OF CIRCULATION VANESSA D’SOUZA ITP LIVE GENERAL MANAGER AHMAD BASHOUR ITP GROUP CEO ALI AKAWI CFO TOBY JAY SPENCER-DAVIES PUBLISHED BY AND © 2019 ITP MEDIA GROUP FZ-LLC. MEDIA FES TIVE GIFT GUIDE ARE CEOS CONFIDENT ABOUT GROW TH? ARE THEY PREPARED TO LEAD THE CHARGE? BEHAVIOURAL ECONOMICS Why informed decision making makes for good leadership AGE OF HUBLOT The Swiss watchmaker’s CEO and his plans to make the brand among the 10 best in the world THE NEXT DECADE Why the next decade of the Capital Club is one to look out for DECEMBER 2018 #143 THE GUIDE TO GOOD BUSINESS AND BETTER LIVING LEG ACY UA E AED 20 BAHR AIN BHD 2 KUW AIT KWD 2 OMAN OMR 2 REF ORMS THE PACE NEEDS TO CONTINUE HOW DUBAI CARES’ CEO MADE A DIFFERENCE TO 53 MILLION LIVES NIKKI BEA CH STEP INTO ANOTHER WORLD C A PITAL CL UB THIS TIME’S DIFFERENT PLE ASURE RICHARD MILLE TOURBILLON TALISMAN IMP A C T DE CEMBER 2018 I SSN 1818- 4421 9771818 442009 00143 GROW TH EXCLUSIVE: MARRIOTT CEO ARNE SORENSON ISN’T READY TO SLOW DOWN YOGESH MEHTA AND HIS SON ROHAN LOOK BACK, THINK AHEAD, AND PLOT PETROCHEM’S FUTURE EMPIRE AVIATION’S UNRIVALLED GROWTH STR ATEG Y#catererawards SPONSORSHIP ENQUIRIES NICK CLOWES Sales Manager PHONE: +971 4 444 3115 EMAIL: nick.clowes@itp.com NOMINATION ENQUIRIES Simon Ritchie Editor, Caterer Middle East PHONE: +971 4 444 3550 EMAIL: simon.ritchie@itp.com FOR EVENT ENQUIRIES TERI DUNSTAN Event Manager PHONE: +971 4 444 3227 EMAIL: teri.dunstan@itp.com FOR TABLE BOOKINGS Lacie Curtis Table Sales Executive PHONE: +971 4 444 3223 Email: lacie.curtis@itp.com join us for the 11th annual CATERER MIDDLE EAST AWARDS NOMINATIONS NOW OPEN WEDNESDAY 11TH june 2019 DUB AI, U A E FOR FURTHER INFORMATION PLEASE VISIT www.caterermiddleeast.com/awards8 C EO M I D D L E E A S T JA NUA RY 20 19 BIG PICTURE FORMULA E CARS VIE FOR POSITION DURING THE ABB FIA FORMULA E CHAMPIONSHIP, at the historic Ad Diriyah district on the outskirts of the Saudi capital, Riyadh. The electric car race– the first in Saudi Arabia – is part of the government’s larger plan to boost tourism and diversify the kingdom’s economy. PHOTO: MALCOM GRIFFITHS/HANDOUT/GETTY IMAGESJA NUA RY 20 19 CEO MIDDLE E A ST 9 BUSINESS BANKING AND FINANCE FINANCE AVIATION MANAGEMENT TECHNOLOGY 1980 The year of the establishment of the UAE Central Bank Financial regulation The main responsibility of the UAE Central Bank is the formulation and implementation of banking, credit and monetary policies UAE BANKS’ ASSETS TOTAL $618BN THERE ARE 60 BANKS OPERATING IN THE UAE , WITH EIGHT BEING SHARIA-COMPLIANT AND 52 BEING COMMERCIAL HE ASSETS OF UAE CONVENTIONAL BANKS (CB) have totalled around $618bn (AED2.275tn), making up 79.7 percent of the country’s banking assets by the end of Novem- ber 2018, according to statistics by the Central Bank of UAE. Sharia-compliant banks accounted for 20.3 percent of total banking assets. The total assets of CB rose by $36bn (AE- D132bn) during the first 11 months of the year, marking a growth of 6.1 percent when com- pared to December 2017. On the other hand, Islamic banks’ assets stood at $158bn (AED579.2bn) by the end of November, a 5.3 percent rise from the end of 2017. It brought total conventional and Islamic banking assets to $776bn (AED2.855tn) by the end of November 2018. Moreover, total loans provided by CBs increased to around $346bn (AED1.279tn) by the end of November, amounting to 77.4 percent of total loans provided by banks in the UAE, with around $102bn (AED374bn), or 22.6 percent, having been provided in loans by Islamic banks. Deposits by conventional banks are valued at $362bn (AED1.336tn) representing around 77 percent of total deposits at UAE-based banks during the same time period, while de- posits at Islamic banks in particular totalled $110bn (AED402.5bn), making up 23 percent of total banking assets. There are 60 banks operating in the UAE, with eight being Sharia-compliant and 52 lenders being commercial, according to the central bank reports. TNext >