Amid the escalating sovereign debt crisis in the eurozone and the revolutionary wave across the Arab world, CFA Institute has released the results of the second annual CFA Institute Middle East Survey which gauges opinions on the key issues currently facing investment markets in the region.
The survey of members and charterholders in the Middle East highlighted that while the global financial crisis and Arab Spring have undoubtedly undermined market confidence and contributed to financial uncertainty, it is clear that the majority of CFA charterholders and members believe that financial stability and economic growth will eventually return.
Respondents were asked about the effect of the global financial crisis in the Middle East in 2012. The majority of respondents believe that diversification of investments, fiscal policy, demand for new sukuks and bonds and oil prices will keep rising. In contrast they believe that liquidity, real estate prices and levels of trust will continue to decline this year.
In addition, the survey indicated that three quarters of respondents (75%) think that transparency of investment decisions and accountability, increased regulation of the markets, and improved financial reporting are the best ways the investment industry can rebuild trust in Middle East financial markets.
Over three quarters of respondents (76%) also believe that the Arab Spring will further decrease investor confidence in regional markets over the next twelve months but a majority (66%) believe that confidence will return over the next three years.
When asked about Europe, the majority of respondents (74%) indicated that they do not believe the eurozone will break up in 2012.
Speaking ahead of the CFA Institute Middle East Investment Conference, Mr. Nitin Mehta, CFA, Managing Director, Europe, Middle East, and Africa, CFA Institute, commented on the findings: “The survey findings suggest that our core principles of good corporate governance, strong ethics and ongoing professional education are the best way forward. Whether this will happen in 2012 is not clear but essentially the investment community remains optimistic about the future of this region.”
The survey was conducted online from 21-29 February 2012 and the sample response comprised a diverse range of CFA Institute charterholders and members belonging to eight different national societies, including: Bahrain, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia and the United Arab Emirates.