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Dubai: Business confidence in the Gulf declined by five percentage points to 80 this year from last year's 85, according to a latest survey.
This is however, much higher than the US, which fared 44 per cent this year, a decline of 12 per cent from last year's 56, according to the second Arab Business Intelligence Report (ABIR), to be released today.
ABIR was published by PriceWaterhouseCooper (PWC) and Moutamarat, a joint venture created in 2005 between Tatweer and Saudi Research Company. ABIR's findings were based on 568 surveys conducted in 18 countries.
However, globally business confidence remain unchanged this year, at 76 per cent.
"The high confidence level in the GCC is being primarily driven by Saudi Arabia, Oman and Qatar," the report said.
"Conversely, confidence has dropped in the UAE and Bahrain with decreases of 11 per cent and 16 per cent respectively."
The report show that the economic confidence in the UAE dropped from 87 per cent last year to 78 this year.
Saudi Arabia and the UAE are seen by business leaders as the major growth markets across the Arab region, according to the study.
"Lack of available talents (73 per cent) and increased competition (63 per cent) are perceived as the major threats to business growth in the region," ABIR said.
"Global terrorism (61 per cent) is still regarded as a major threat to the econ-omic well-being, but has diminished since 2005 (71 per cent).
Arab business leaders report that raising education levels within the workforce and improving infrastructure are the most important factors for sector growth and development, it said.
"An expected increase in the demand for skilled labour has resulted in 81 per cent of Arab business leaders predicting that costs of skilled labour will be higher in 12 month's time," it said.
The UAE ranked fifth in the quality of international labour market while it ranked 10th in the quality of domestic labour market, among 14 countries.
"Bahrain, Kuwait, Qatar and the UAE expect a major increase in the cost of skilled labour due to the shortage of adequate human capital," the latest ABIR survey said.
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