The economic shock caused by Covid-19 has affected companies from around the world. A year on, their recovery remains uncertain. But the impact on Mena companies differs from other regions in a few unique ways.
To gather timely information about how companies are navigating through the pandemic, the World Bank, often in partnership with national statistical offices, has been carrying out Covid-19 Business Pulse Surveys.
Since May 2020, the surveys have covered more than 100,000 businesses in more than 50 countries, including Algeria, Djibouti, Morocco, Tunisia, Jordan and the Palestinian territories of the West Bank and Gaza.
Other Mena countries could still benefit from participating in the survey and generate timely information for policymakers to help companies recover.
The Mena BPS findings highlight that the ways in which the pandemic affected companies include revenue loss, financial distress and job losses. However, despite drastic declines in sales and business activity, most Mena companies have held on to their workers while their adoption of technology has been slow.
The surveys also show that Mena companies remain highly uncertain about the recovery and fear a decline in demand, production and work hours. Many also worry about further pandemic waves and movement restrictions.
While most companies have reopened at some capacity, a non-trivial share (10 per cent to 20 per cent) across surveyed countries in the region remain closed.
A significant share of Mena companies – 14 per cent in the West Bank and Gaza and 17 per cent in Algeria – have cut the number of permanent staff. Nonetheless, the share of companies in the region that laid off workers seems to be less than in other regions.
Most companies have tried to hold on to their permanent workforce by offering leave, often without pay, and reducing work hours, salaries and the number of temporary workers.
Nonetheless, the persistent decline in sales and a prolonged pandemic threaten to result in permanent job losses for Mena companies.
Between July and August last year, 26 per cent of companies in Jordan had cut permanent workers. However, this increased to 39 per cent between November and January.
Revenue loss and closures
The pandemic has negatively affected 92 per cent of companies in the West Bank and Gaza and 89 per cent of companies in Djibouti, Tunisia, and Jordan.
For most of these businesses, sales have declined by more than 50 per cent from pre-Covid levels. This magnitude of revenue loss is in line with that experienced in developing markets.
Across the developing world, the loss of sales appears to be persistent, which is also likely to be the case in Mena countries.
For instance, in Jordan, 601 companies were surveyed between May and November 2019 (pre-Covid-19), and then between July and August 2020 (Covid-19, round 1) and again between November 2020 and January 2021 (Covid-19, round 2).
The average decline in sales seems to be persistent at about 50 per cent in both Covid-19 survey waves. Smaller businesses and companies in the service sector seem to be the hardest hit.
Unable to cope with the persistent decline in sales, a significant share of businesses across Mena countries, particularly smaller companies, have permanently closed.
For instance, 17 per cent of companies in Jordan went out of business between November and January – up from 11.6 per cent during the early stages of the pandemic.
In Morocco, 9 per cent of companies closed down, but the percentage of smaller companies shutting their doors was much higher (at 11 per cent) than for larger businesses (2 per cent).
Declining revenue has also left most companies, particularly small businesses, in financial distress. About nine in 10 businesses in the West Bank and Gaza, 93 per cent in Jordan, 78 per cent in Tunisia and 72 per cent in Morocco reported a fall in cash flow.
Delaying payments to suppliers, landlords or tax authorities and being overdue on obligations to financial institutions have been the methods by which most companies have coped. Besides the financial distress, disruptions in transport and logistics and the supply of inputs appear to be some of the key impediments Mena companies face.
Going digital as a coping mechanism
Despite its several adverse impacts, the Covid-19 pandemic has motivated companies across the developing world to take advantage of digital technology.
Building a stronger digital presence also seems to be an essential coping mechanism for a significant share of companies (between 20 per cent an 30 per cent) across surveyed countries in the Mena region. Increased internet use, online social media, specialist apps and digital platforms have been ways through which companies have continued business operations.
Nonetheless, Mena companies have considerable scope to catch up with their peers on digital solutions. Moreover, the gap between micro and small businesses and larger companies in digital technology adoption is higher in the Mena region than anywhere else.
Several structural impediments in Mena countries are likely to inhibit companies’ technology adoption and innovation. These include a high degree of informality, particularly among micro and small businesses, a lack of digital payment solutions, underdeveloped and costly digital infrastructure and a lack of domestic competition and export competitiveness that reduce the incentive to innovate.
Policy support
Most Mena companies said they need policymakers to prioritise deferrals or subsidies covering utility and rent payments, salaries, tax exemptions and deductions to help them through the pandemic.
Policy support in different Mena countries has allowed companies to avoid falling into arrears and cope with uncertainty.
However, based on surveys in different Mena countries, it appears that policy support is only reaching a few companies. For instance, while 33 per cent of companies in Jordan received government assistance, that share is less than a tenth in Algeria and Tunisia.
A well-targeted, time-bound and effective policy support programme is much needed to keep Mena companies afloat and navigate the turbulent waves of Covid-19 shocks.
Nadir Mohammed is director for equitable growth, finance and institutions in the Mena region at the World Bank, Djibrilla Issa is practice manager for finance competitiveness and innovation in the Mena region at the World Bank and Aminur Rahman is lead economist in the World Bank's finance, competitiveness and innovation global practice in the Mena region
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Classification of skills
A worker is categorised as skilled by the MOHRE based on nine levels given in the International Standard Classification of Occupations (ISCO) issued by the International Labour Organisation.
A skilled worker would be someone at a professional level (levels 1 – 5) which includes managers, professionals, technicians and associate professionals, clerical support workers, and service and sales workers.
The worker must also have an attested educational certificate higher than secondary or an equivalent certification, and earn a monthly salary of at least Dh4,000.
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Greatest of All Time
Starring: Vijay, Sneha, Prashanth, Prabhu Deva, Mohan
MATCH INFO
Who: France v Italy
When: Friday, 11pm (UAE)
TV: BeIN Sports
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
Director: Laxman Utekar
Cast: Vicky Kaushal, Akshaye Khanna, Diana Penty, Vineet Kumar Singh, Rashmika Mandanna
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The five pillars of Islam
1. Fasting
2. Prayer
3. Hajj
4. Shahada
5. Zakat
Company Profile
Name: Thndr
Started: 2019
Co-founders: Ahmad Hammouda and Seif Amr
Sector: FinTech
Headquarters: Egypt
UAE base: Hub71, Abu Dhabi
Current number of staff: More than 150
Funds raised: $22 million
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
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Director: Hasan Hadi
Starring: Baneen Ahmad Nayyef, Waheed Thabet Khreibat, Sajad Mohamad Qasem
Rating: 4/5
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Directed by: Jeethu Joseph
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PRIMERA LIGA FIXTURES
All times UAE ( 4 GMT)
Saturday
Atletico Madrid v Sevilla (3pm)
Alaves v Real Madrid (6.15pm)
Malaga v Athletic Bilbao (8.30pm)
Girona v Barcelona (10.45pm)
Sunday
Espanyol v Deportivo la Coruna (2pm)
Getafe v Villarreal (6.15pm)
Eibar v Celta Vigo (8.30pm)
Las Palmas v Leganes (8.30pm)
Real Sociedad v Valencia (10.45pm)
Monday
Real Betis v Levante (11.pm)
COMPANY%20PROFILE%20
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COMPANY%20PROFILE
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Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
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This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
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Developer: From Software (remaster by QLOC)
Publisher: Namco Bandai
Price: Dh199
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Power: Combined output 920hp
Torque: 730Nm at 4,000-7,000rpm
Transmission: 8-speed dual-clutch automatic
Fuel consumption: 11.2L/100km
On sale: Now, deliveries expected later in 2025
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Wicked: For Good
Director: Jon M Chu
Starring: Ariana Grande, Cynthia Erivo, Jonathan Bailey, Jeff Goldblum, Michelle Yeoh, Ethan Slater
Rating: 4/5
A new relationship with the old country
Treaty of Friendship between the United Kingdom of Great Britain and Northern Ireland and the United Arab Emirates
The United kingdom of Great Britain and Northern Ireland and the United Arab Emirates; Considering that the United Arab Emirates has assumed full responsibility as a sovereign and independent State; Determined that the long-standing and traditional relations of close friendship and cooperation between their peoples shall continue; Desiring to give expression to this intention in the form of a Treaty Friendship; Have agreed as follows:
ARTICLE 1 The relations between the United Kingdom of Great Britain and Northern Ireland and the United Arab Emirates shall be governed by a spirit of close friendship. In recognition of this, the Contracting Parties, conscious of their common interest in the peace and stability of the region, shall: (a) consult together on matters of mutual concern in time of need; (b) settle all their disputes by peaceful means in conformity with the provisions of the Charter of the United Nations.
ARTICLE 2 The Contracting Parties shall encourage education, scientific and cultural cooperation between the two States in accordance with arrangements to be agreed. Such arrangements shall cover among other things: (a) the promotion of mutual understanding of their respective cultures, civilisations and languages, the promotion of contacts among professional bodies, universities and cultural institutions; (c) the encouragement of technical, scientific and cultural exchanges.
ARTICLE 3 The Contracting Parties shall maintain the close relationship already existing between them in the field of trade and commerce. Representatives of the Contracting Parties shall meet from time to time to consider means by which such relations can be further developed and strengthened, including the possibility of concluding treaties or agreements on matters of mutual concern.
ARTICLE 4 This Treaty shall enter into force on today’s date and shall remain in force for a period of ten years. Unless twelve months before the expiry of the said period of ten years either Contracting Party shall have given notice to the other of its intention to terminate the Treaty, this Treaty shall remain in force thereafter until the expiry of twelve months from the date on which notice of such intention is given.
IN WITNESS WHEREOF the undersigned have signed this Treaty.
DONE in duplicate at Dubai the second day of December 1971AD, corresponding to the fifteenth day of Shawwal 1391H, in the English and Arabic languages, both texts being equally authoritative.
Signed
Geoffrey Arthur Sheikh Zayed
