Abraaj Emerging With Confidencev2

8/6/2019 Abraaj Emerging With Confidencev2

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September 2009

Emerging With Confidence

Strictly Private & Confidential. This isnot research and is not intended assuch. This presentation representsAbraaj Capitals views on certain trendsprevalent in the MENASA region andthe impact of the global economicdownturn on the region. Please alsorefer to the disclaimer at the end.

Reassessing the Investment Case for MENASAOne Year On


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2

Emerging With Confidence Table of Contents

Middle East, North Africa & South Asia: A Region Without Parallel .. 3

The MENASA Region

The Regions Connectivity with the Global Economy

Performance Through the Crisis: Assessing the Impact of the Global Downturn . 6

GDP Growth Trends

The Real Economy

Financial Sector

Oil

Real Estate

Currencies and Inflation

Explaining the Last Twelve Months: Why Did Regional Economies Perform Relatively Well? .17 Nature of the Economies

Low Leverage

Sovereign Strength

Looking Forward With Confidence: What Will Drive Further Growth? 26 Macro Perspective

Petrodollars

People

Policies

Pent-up Demand


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3

Middle East, North Africa & South Asia: A Region Without Parallel

The MENASA region includes the GCC, Levant, Turkey, North Africa and South Asia (India andPakistan), linked to the global economy through global trade, particularly oil and gas exports, capital

flows and human connectivity / immigration

Note: While we treat MENASA as asingle bloc we acknowledge thatSouth Asia (India in particular) candistort statistics given its size. Wealso acknowledge that many

institutions look at MENA rather thanMENASA. Therefore, wherepossible, we separate out thestatistics for India and/or South Asia.


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4

India

2008 Nominal GDP:US$ 1,226 billion08/09 Real GDP Growth:6.1% / 5.5%10-13 Real GDP Growth:8.1%2008 Population:1,148 million

GCC

2008 Nominal GDP:US$ 1,049 billion08/09 Real GDP Growth:6.4% / 0.0%10-13 Real GDP Growth:4.6%2008 Population:40 million

North Africa

2008 Nominal GDP:US$ 528 billion

08/09 Real GDP Growth:5.5% / 3.1%10-13 Real GDP Growth:5.7%2008 Population:164 million

The MENASA Region

MENASA has a combined GDP of US$ 3.7 trillion growing at 5.9% p.a., with a population of 1.6 billion

2008 Nominal GDP:US$ 730 billion08/09 Real GDP Growth:1.1% / -5.6%10-13 Real GDP Growth:3.5%2008 Population:72 million

Source: EIU as of July 2009, IMF, Bloomberg, PCTAS, UN Comtrade, McKinsey & Company

Pakistan

Turkey

2008 Nominal GDP:US$ 165 billion08/09 Real GDP Growth:2.0% / 3.7%10-13 Real GDP Growth:4.9%2008 Population:177 million

Levant

2008 Nominal GDP:US$ 48 billion08/09 Real GDP Growth:6.0% / 2.5%10-13 Real GDP Growth:3.8%2008 Population:10 million

Qatar

Tunisia

JordanLebanon

UAE

Kuwait

Morocco

AlgeriaLibya Egypt

Turkey

SaudiArabia

Bahrain

Pakistan

India

Oman

One region: Complimentary and diversified resources including hydrocarbon wealth and a large pool of skilled labor

Cultural ties:The MENASA region has common religions, common customs, shared languages and has had periods of common governance ranging

from the Persian Empire to the British Empire

As recently as the 1960s, the Gulf countries currency was the Gulf Rupee. It was issued by the Reserve Bank of India

Trade ties:Trade between the MENASA countries increased from US$ 45 billion in 2002 to US$ 229 billion in 2007, growing at an annual rate of 38%

Capital flows and investments:In-bound M&A activity increased more than six-fold between 2002 and 2008 while cross-border investments have

become deeper

Labor mobility:In 2008, MENASA countries received more than US$ 59 billion in remittances, of which US$ 16 billion originated from the regionitself, predominately the GCC

Approximately 25% of the population in the GCC countries originate from India and Pakistan

Intra-regional travel increased from 33 to 58 million passengers from 2000 to 2007


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5

90%

45% 44%40%

17% 16% 14% 14%9%

21%23%32%33%

Malaysia

Korea

MENA

Germany

MENASA

China

Italy

France

UK

Japan

MENA

(e

x.Oil&Gas)

SouthAsia

US

The Regions Connectivity with the Global Economy

The MENASA region is linked to the global economy through global trade, capital flows and humanconnectivity / immigration

Global trade:Countries in MENASA are linked to the global

economy through trade, particularly the export of oil and gas

from MENA and services from India

MENASAs total exports-to-GDP ratio of 33% is on par

with major exporting countries such as China

For MENA, the total exports-to-GDP ratio is 44%.Excluding hydrocarbons, MENA exports account for 14% of

GDP

Given its strategic location, MENASA has also become a

global hub in the logistics and transportation sectors

Capital flows:Private capital inflows into the Middle East

increased from US$ 31 billion to US$ 414 billion from 2003

to 2007, with its share of such inflows versus other developing

Note: Analysis based on total exports of goods on a FOB basis; Data for all countries as of 2008 exceptUAE (2007), Egypt (LTM as of 6/30/08), Morocco (2007), India (LTM as of 3/31/08), Japan (2007)* Average does not include MENA excluding oil & gas

countries increasing from 7% to 19%

Human connectivity:Significant influx of individuals plus

movement of people throughout the MENASA region, be it in the

form of labor or tourists, has increased the connectivity of theregion with the rest of the world

47% of the workforce in Saudi Arabia and 90% of the

workforce in the UAE is made up of expatriates

Turkey, Egypt and Saudi Arabia rank in the top 25 global

tourist destinations

Dubai is the 8

th

most visited city in the World The region attracted over 100 million international visitors

in 2007 and is expected to attract over 160 million visitors

in 2017

Source: Government Sources, UN Comtrade, WTO, KITA, Turkstat, EIU as of July 2009, IMF, Zawya, McKinsey & Company, Euromonitor

Total Exports-to-GDP Ratios

Middle East Private Capital Inflows

Average*: 32%

* Private capital flows comprise direct investment, portfolio investment, and other long- and short-terminvestment flows

19%19%

10%10%7%

0

100

200

300

400

500

2003 2004 2005 2006 2007

0%

5%

10%

15%

20%

25%

Inflows (US$ billions) % of Emerging Markets


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Performance Through the Crisis: Assessing the Impact of theGlobal Downturn

While the MENASA region has not been immune from the effects of the credit crisis in Westernmarkets and consequent global downturn, as reflected in falling oil prices, declining real estate and

equity market values and rising NPLs, the region as a whole has avoided a recession and the outlookremains strong with businesses in growth mode and consumer confidence rising


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Performance Through the Crisis GDP Growth Trends

Despite a slowdown in 2009, countries in MENA and South Asia continue to post positive GDP growth withthe region as a whole still expected to grow at a healthy rate of 1.5% in 2009 and 5.9% p.a. from 2010-2013

* Real GDP growth of non-oil sector based on IMF projections, which estimates real GDP growth of 1.3% (higher than EIU estimates as shown in the graphs)Source: EIU as of July 2009 (Note: EIU forecasts oil (WTI) price of US$ 62.5 / barrel in 2009), IMF

Due to the increased interconnectivity of the region with the

global economy, the global economic crisis has had a

negative impact on growth causing a historical annual growth

rate of c. 7% over the past five years to slow in 2009

For oil-exporting countries, a sharp drop in oil demand led

to a price correction and eventually, production cuts. For

example, Saudi Arabia and Qatars hydrocarbon exportrevenues are expected to decrease by 48% and 34%,

respectively, in 2009

Real GDP growth for the GCC is expected to be flat in 2009

due to oil production cuts. The non-oil sector continues to

drive growth in the GCC with this sector expected to

grow 3.2% in 2009*

Tightening credit is expected to slow growth in the GCCparticularly due to its impact on project finance

Growth in countries such as Turkey/Egypt, which are

dependant on external capital flows, is expected to be

negatively impacted by a sharp fall in FDI of 54% and 44%,

respectively

In Egypt, strong domestic consumer demand is expected to

offset this decline

Turkey contracted by 14.3% in Q1 09 due to a drop in

private sector consumption, investment expenditures

and industrial production. However, with the banking

sector in good shape, a manageable public debt position,

low household debt and a strong government response, the

outlook for the rest of the year is positive

Despite the slowdown in 2009, the regions outlook comparesfavorably to most of the rest of the world with medium-term

growth projected at an average of c. 6% for MENASA and

4.5% for MENA

Real GDP Growth (2010-2013 CAGR)

Real GDP 2008 and 2009e Growth Rates

2008e real GDP growth




1.1%

9.0%

0.6%

3.9%

2.0%

1.1%

4.4%5.1%

6.4%

4.9%6.0%

5.5%

2.0%

6.1%

(5.6%)(4.5%)

(3.3%)(2.7%)(2.6%)

(1.1%)(1.0%)(0.0%)

1.5%2.5%

3.1%3.7%

5.5%

8.0%

China

India

Pakistan

NorthAfrica

Levant

MENASA

GCC

Brazil

MENA

US

World

L

atAm

EU15

Turkey

India

Pakistan

NorthAfrica

L

evant

ME

NASA

GCC

M

ENA

Turkey

8.5%8.1%

5.9% 5.7%

4.9%4.6% 4.5%

4.1% 3.9% 3.8%3.5%

2.7%

1.4% 1.3%

China Ind

ia

MENA

SA

North

Afric

a

Pakis

tan GCC

MENA

Braz

il

LatAm

Leva

nt

Turke

yWo

rldEU

15 US


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(6.0%)

(4.0%)

(2.0%)

0.0%

2.0%

4.0%

6.0%

8.0%

2005 2006 2007 2008 2009 2010

Oil Non-Oil

0

10

20

30

40

50

Apr-03 Aug-04 Dec-05 Apr-07 Aug-08

-60

-40

-20

0

20

40

60

80

100

OPEC basket (RHS)M2

Private credit

The oil economy

The oil and gas exporting countries of the MENASA region

include the GCC, Libya and Algeria

Primary source of income for oil exporting governments (most

of which have low to no tax regimes), e.g. oil revenues accountfor c. 80% of GCC budget revenue

Main source of liquidity, driving domestic credit expansion and

allowing access to international credit markets

Drives sentiment within these economies

This sector of the economy is a state run enterprise with limitedscope for private investment

1. Depending on price of oil with some economies being more dependant on oil than others. Based on 2006 real GDP contribution the non-oil sector contributed 68% of GDP for the GCCSource: IMF, BAS-ML, Standard Chartered

While the oil sector provides a source of income for governments, the non-oil sectors contribute alarger share to GDP growing at a faster pace

Oil and Non-Oil Real GDP Growth for GCCGCC Liquidity M2, Private Credit and Oil Price (%YOY)

The non-oil economy

Abundant oil-driven liquidity and concerted effort on the part of oil

exporting economies to diversify away from hydrocarbons has

created a fast growing non-oil sector

Non-oil sectors contribute c. 50-70% of the GCC economies1

The non-hydrocarbon sector employs 98.5% of the labor force

in the gulf oil states

As production cuts cause the oil sector to contract the non-oil

sector of the GCC is still expected to grow at 3%+ in 2009

Primary focus of private investment

Performance Through the Crisis Role of Oil in GDP Trends


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Utilities

-5%

4% 3% 5% 3%

-1%

41%

NA

S&P Nikkei EM Saudi UAE Turkey Egypt India

Telecommunications

2%

-7%

27% 26%22%

7%

-1%

23%


Consum er Services

-2% -5% -6%

12%

30%

9%

-10%

NA


Healthcare

2% 3%

10%

17%

27%

20%18%

NA


Consumer Goods

-21%

-4%

14%

-2%

-29%-22%

10%

-34%


Industrials

-11% -9%-6%

4%

12%

1%

14%

-17%

S&P Nikkei EM Saudi UAE Turkey Egypt India Egypt

Egypt

Turkey EgyptEgypt

9

Performance Through the Crisis The Real Economy

* EM includes companies listed in Hong Kong, Singapore, Malaysia, China and BrazilSource: HSBC, Bloomberg

Sales Growth (Q1 2009 vs. Q1 2008) Publicly-listed Companies by Sector At the height of the crisis, corporate

performance in many sectors across the

region proved resilient, with positive

growth in a number of industries

This growth has been driven partly by

the relatively early stage nature ofmany of these markets, in particular

consumer-related sectors, and has been

driven by both organic initiatives and

external acquisitions

Average Q1 2009 vs. Q1 2008 sales

growth for all listed companies inMENA was c. 20%

In general companies in key sectors of the

real economy in the major MENASA

markets out-performed their

counterparts in the S&P 500 and Nikkei

indices as well as those in a number ofother emerging markets* by a significant

margin

Infrastructure-related sectors such as

telecommunications, utilities and

healthcare also posted strong results,

further highlighting the growth stage of

many sectors in the region

Corporates in the MENASA region continued to record strong top-line performance across severalsectors in Q1 2009

UAE Turkey India Saudi UAE Turkey India

Saudi UAE Turkey India Saudi UAE

Saudi UAE Turkey Egypt India Saudi UAE Turkey India

Saudi Egypt

India

* *

**

* *


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$36

$181

$71

$699

$15

$154

$150

$173

$251

$144

$1,919

$107

$237

$136

$13

$294

$55

$123

$25

$1,708

J

I

H

G

F

E

D

C

B

A

$20

$73

$32

$149

$7

$73

$75

$89

$126

$72

$828

$724

$14

$53

$22

$131

$6

$68

$104

$61

J

I

H

G

F

E

D

C

B

A

10


Note: Infrastructure Growth Capital Fund (IGCF)Company B, C, D, I & J quarterly performance derived from annual and half-year results; Results for Company D, E, G, H, I & J are converted from local currency to USDat a constant exchange rate to ensure currency fluctuations are not included in resultsSource: Abraaj analysis

A review of Abraajs IGCF partner companies, many of which operate in recession-resistantindustries, confirms the strong performance of corporates in 2009

21

47

5

7

11

14

14

43

39

47

Transportation

SocialServices

Infrastructure

Infrastructure-India

Sales Performance and Growth IGCF Portfolio (US$ million)

6

61

5

13

13

12

138

CY H1 2008 CY H1 2009 # % growthCY Q1 2008 CY Q1 2009

H1 2009 vs. H1 2008

29

47

45

Q1 2009 vs. Q1 2008


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Business and consumer confidence is on the rise with only a marginal increase in unemployment ascompared to other harder hit countries

Source: EIU as of July 2009, Gulf News, TCMB, Central Bank of Turkey, Bayt.com, YouGov, Nielsen

After trending down for nearly a year, confidence indices

bottomed out in February 2009 but are now back on the rise

Consumer confidence and optimism towards the future is

increasing. In a recent survey, 44% of respondent in the Middle

East believed their financial position would be better in a year. In

addition, recently India and UAE ranked as the 2nd and 7th most

optimistic countries in the world in the Nielsen Global Consumer

Confidence Index

The region has witnessed only a very small number of high

profile debt restructurings and defaults and nothing like to the

extent in more developed markets

Unemployment in the region has increased at a much

slower pace compared to some of the harder hit economies in

the developed world

Employment remains an issue, however. Some countries

such as Jordan, Pakistan, Tunisia and Turkey have high

unemployment (14% to 16% for 2009e). Governments haveacknowledged the need to address the issue and are

adopting policies to boost employment, including private

sector investment

Remittances have dropped only slightly; Lebanon is not

expecting to see a significant decline, Jordan has only

witnessed a 3.4% drop (first four months of 2009 vs. sameperiod in 2008), Pakistan has experienced a 23% increase

(H1 09 vs. H1 08) while Egypt has witnessed a 16% drop

(Q1 09 vs. Q1 08)

Business Confidence GCC and Turkey

Increase in Unemployment (2008 to 2009e)

78%

47%

31%29%

17%

9%

United States Japan France Germany MENA South Asia

105.4

79.4

71.2

92.0

96.0

99.8100.0

74.8

75.9

67.8

99.496.9

59.4

69.2

114.2113.5

50

60

70

80

90

100

110

120

Feb-07 Jun-07 Oct-07 Feb-08 Jun-08 Oct-08 Feb-09 Jun-09GCC Business Confidence Index Turkey Business Confidence Index

Note: Data for Bahrain, Kuwait, Lebanon, Libya, Oman and UAE not available

C S B


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The most immediate impact of the downturn has been an

increase in NPLs, which in many case have doubled albeit

from previously low levels. While NPLs have increased, they are

well below the average peak NPLs of 32% in past crises such

as Japan in 1997, Norway in 1991 and India in 1993

Banks in the region had minimal exposure to sub-prime andother toxic assets in the West; however the rise of NPLs

coincided with a sharp correction in certain regional real estate

and equity markets, most notably in the UAE and Kuwait,

negatively impacting those banks that were overexposed to

these sectors and requiring government intervention

Lending growth has slowed significantly but is still growing.However, growth is projected at a much slower pace going

forward. An analysis of the average loan growth for 16 of the

largest banks in MENA shows annual loan growth between

2005-2008 of 35.4% falling to 8.6% p.a. between 2008-2011

In order to shore up the balance sheets of certain banks as well

as increase liquidity and support lending, governments haveinjected capital, as required, into the banking system.

Importantly, the governments, most notably in the GCC, have

close linkages with the financial sector and were therefore able

to act swiftly in supporting the commercial banks and pumping

liquidity into the financial system

Despite government intervention, however, liquidity concernsremain in the GCC and the exact impact on asset quality

remains uncertain as disclosures of provisions and non-

performing assets remain limited

Performance Through the Crisis Financial Sector: Banks

The region has not witnessed any large scale commercial bank failures and the threat of increasingNPLs and a slowdown in lending have largely been mitigated by decisive government action

Source: Citi, BAS-ML, HC Brokerage

NPLs to Gross Loans of Selected MENA Banks

Government Stimulus Packages for Banking System

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

Kuwait Saudi Arabia Qatar Oman Turkey UAE

0.0%

5.0%

10.0%

15.0%

Stimulus Package (US$ billion) % of GDP

0%

1%

2%

3%4%

5%

6%

NBAD DI

BFG

BUN

BAD

CB ANB

AlRajh

iBan

k

SAMB

AQN

BCB

Q

Doh

aBan

k

BankM

usca

tNB

K

Burg

anBa

nk CIB

2008 2009E

UAE Saudi Arabia Qatar Oman Kuwait Egypt

* Funds having been made available were only partially utilized

*

P f Th h th C i i Fi i l S t C it l M k t


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0

200

400

600

800

1000

1200

Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09

Dubai Abu Dhabi Saudi Arabia Qatar Egypt Turkey

0

20

40

60

80

100

120

140

160

180

Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09

Dow Jones MSCI GCC Egypt CASE Sensex India Turkey ISE MSCI Emerging Markets

13

Performance Through the Crisis Financial Sector: Capital Markets

The regions capital markets witnessed sharp corrections along with other global markets but haverecently begun to recover

Source: Bloomberg

Equity markets in the region have tended to follow the global

markets but with greater volatility. Regional markets have

begun to recover with Turkey and India, in particular,

outperforming both developed and other emerging markets

In addition to a change in outlook dragging equity markets

down, a reversal of capital flows particularly related to

international portfolio rebalancing also negatively impacted

equity markets

Debt markets, in particular sovereign debt, went through a

similar period of turmoil and recovery, most notably

following the collapse of Lehman Brothers. One impact on

the local debt markets was the increase in the CDS spreads on

bonds issued by government related entities, highlighting a

perceived increase in risk associated with these issuances or

the sponsoring government. In Dubai, the CDS spreads

reached the highest levels in the region, peaking at over 950bps

reflecting to some extent a perceived fear of lack of federal

support for the emirate of Dubai. It has since dropped to

350bps. With the exception of Dubai, CDS spreads are now all

c. 200bps or below

Equity Market Performance

CDS Spreads on Government Related Issuers

Returns

2008 peak

to 12/31/08 YTD 2009Dow Jones (32.8%) 8.2%MSCI GCC (59.6%) 21.5%Egypt CASE (61.5%) 44.9%Sensex India (53.8%) 67.1%Turkey ISE (50.9%) 66.9%MSCI EM (54.6%) 55.3%

2008 YTD 2009

Hi Lo Hi Lo

Dubai 470 39 977 348

Abu Dhabi 282 53 475 110

Saudi Arabia 245 53 335 82

Qatar 263 32 380 86

Egypt 800 102 688 183

Turkey 849 167 522 193

P f Th h th C i i Oil


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0

20

40

60

80

100

120

140

160

Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09

$54/bbl: 2009 GCC budgetbreakeven price

14

Performance Through the Crisis Oil

Source: BAS-ML, EIA, News sources, Bloomberg

The global economic slowdown resulted in a fall in global oil demand, leading to both a fall in pricesand production cuts by OPEC members

Change in World Oil Supply and Demand (mb/d)

WTI Spot Price (US$ / barrel)

Global oil demand declined by 0.5 million barrels a day in

2008 and is projected to decline by another 1.7 million barrels

per day in 2009. A large portion of this decline is from the OECD

economies

The fall in demand resulted in a price correction which saw oilprices decline from highs of US$ 145 in July to lows of U$ 30 in

December 2008, briefly falling below the 2009 average budget

breakeven price for the GCC of c. US$ 54

For non-oil exporting countries such as Egypt, Turkey, India

and Pakistan, lower prices alleviated some inflationary

pressures

To support the market, OPEC agreed to cut output by 4.2

million bpd, or 5% of daily world demand. The GCC

accounts for the bulk of these cuts, with Saudi Arabia alone

having absorbed 33% of this cut, or 1.4 million barrels per day

Given the scale of the production cuts and perceived

improvement in the global macroeconomic environment, prices

have begun to recover since Q2 2009 and have stabilized

around US$ 70 per barrel

(3.0)

(2.0)

(1.0)

0.0

1.0

2.0

2007 2008 2009 2010

OECD demand Non-OECD demandTotal demand Total supply

2007 2008 YTD 2009High Low High Low High Low

$99.2 $50.5 $145.3 $30.3 $73.7 $34.0

Sep-09

Performance Through the Crisis Real Estate


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15

Performance Through the Crisis Real Estate

Source: JLL, IMF, Colliers International, News sources

After experiencing a strong run-up, real estate prices declined

across the region, with some markets such as Dubai

witnessing a 40-60% drop, while drops in Doha, Istanbul

and Mumbai were 40%, 10-40% and 5-40%, respectively

Price decline was concentrated in the high-end residentialsegment, which was driven by significant speculative behavior

in certain locations such as Dubai, Abu Dhabi and Kuwait.

The middle-income and affordable housing segment did

not experience as sharp a drop, especially in markets with

large domestic populations such as Cairo and Riyadh

Rental prices on office and residential properties have

declined across the region, although the correction has been

less severe than that of sales prices. The drop in rental prices

has been a plus in terms of controlling double-digit inflation

levels

There are signs of price stabilization. Focusing on the

hardest hit market, the UAE, there are indications that prices

have bottomed out. In a May 2009 report, HSBC noted that

prices had increased for two successive months in the UAE,

rising 4% in April and 5% in May. Deutsche Bank issued a

report stating that the average price for apartments and villas in

the UAE rose 6.5% month-on-month in June 2009 and Jones

Lang LaSalle found there has been a convergence between

asking and achieved prices, signaling stability in the market

Real estate prices, which had previously witnessed a significant run-up, have since corrected backto 2007 levels

Real Estate Price Index

Decline in Rental Prices

Period Impact

Abu Dhabi Peak to Q1 09 Office rents declined 20%-30%

Dubai Peak to Q1 09 Office rents declined 15%-45%;residential rents declined 20%-40%

Doha End-08 to Q1 09 Grade A office rents declined 10%-15%; high-end residential rentsdeclined 15%

Riyadh Q1 08 to Q1 09 Office rents declined 13%

Istanbul Mid-08 to Q1 09 Grade A office rents declined slightly;residential rents declined c. 25%

Office rents for the highest-quality properties have not suffered a decline due to a lack of supply

Note: Index; March 2008 = 100

Performance Through the Crisis Currencies and Inflation


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16

Currencies

The Gulf currencies are fixed (pegged to the U.S. Dollar or a basket

of currencies for Kuwait)

India, Pakistan, Turkey and Egypt have floating currencies. Their

performance against the U.S. Dollar has been mixed

There was a minimal impact on the Egyptian pound

The Turkish Lira, Indian Rupee and Pakistan Rupee have

gone through a period of significant devaluation since the third

quarter of 2008

While the Turkish Lira and Indian Rupee have begun to regain

some ground against the US Dollar in the second quarter of2009, they continue to trade at depressed levels

Certain countries in the region have witnessed a weakening of currencies and a drop in inflation dueto the global economic crisis

Currency Performance (Daily Exchange Rate to the US$)

Performance Through the Crisis Currencies and Inflation

Inflation

In 2008, regional economies witnessed a significant rise in inflation

The increase in inflation was primarily due to rising food, fuel

commodities and especially housing cost

Falling prices accompanying the global economic crisis haveresulted in a decrease in inflation in most countries since Q4 2008

Falling food and real estate prices have helped ease the

pressure on a majority of the population facing difficulties with

rising prices during the economic boom

Falling oil prices have benefitted oil importers, such as India,

Pakistan, Egypt and Turkey

Inflation (YoY % Change in Consumer Price Index)

Source: EIU, Oanda.com

18%

8%

4%

9%

14%

6%

9%

20%

10%10%

15%

8% 8%7%

1%

20%

9%

13%

6%

15%

11%

EGYPT INDIA PAKISTAN QATAR SAUDI

ARABIA

TURKEY

2007 2008 Q1 2009 Q2 2009

60

80

100

120

140

160

Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09

Turkey (Lira) Egypt (Pound) Pakistan (Rupee) India (Rupee)


17/34

17

Structurally strong regional economies, primarily reliant on domestic consumption, fixed investmentand government spending, supported in many cases by significant hydrocarbon revenues andreserves, have performed relatively well. The low degree of leverage throughout the system, at theconsumer, corporate and banking sector levels, supported where necessary by swift action fromregional governments, has resulted in avoiding a regional credit crisis and knock on into the realeconomies

Explaining the Last Twelve Months: Why Did Regional EconomiesPerform Relatively Well?

Explaining the Last Twelve Months Nature of the Economies


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18

Source: EIU as of August 2009. Domestic demand is private consumption + government consumption + gross fixed investment & stockbuilding excluding net exports (exports less imports) from GDP and note that netimporting countries will have a domestic demand component in excess of 100% of GDP. * Does not include UAE and Kuwait


Strong domestic demand, including healthy contributions from private sector investment andgovernment consumption, has helped the region perform well

Breakdown of GDP (2008)

2008-2009e Private Consumption Real Growth

(1%)

5%

2%

5%

(6%)

9%

1%

(2%)

(4%)

(1%)

MENA* S. Asia GCC* North

Africa

Turkey China Brazil Japan Malaysia US

-5%

10%

25%

40%

55%

70%

85%

100%

MENA S. As ia GCC N. Africa Turkey China Brazil Japan Malays ia USPrivate consumption Government consumption Gross fixed investment & Stockbuilding Net exports

Countries in the MENA and South Asia regions have

relatively balanced domestic economies with considerable

room for additional growth

Private consumption is currently at c. 50% of GDP for most

economies in the region, a figure that compares favorably to

emerging markets such as China (which has historically beenfocused on fixed investments, particularly in export driven

industries), however it remains well below that of other

emerging markets such Brazil (61%)

Turkey has relatively high private consumption at 70% of

GDP, reflecting the relatively developed nature of its economy

The GCC, with private consumption contributing 30% of GDP,offers much room for future growth, especially given its

young population and large number of people expected to enter

the workforce

Across the region, private consumption is expected to

remain resilient. Within MENA, Turkey is the only major

economy that will post negative growth, with a decline of 6%.

However, in the GCC, North Africa and South Asia, private

consumption is set to rise 2%, 5% and 5%, respectively.

Among the main drivers contributing to this resilience are

positive demographic changes and the nature of

consumption in the region, which is primarily non-

discretionary, especially in those countries with large

populations such as Egypt and Saudi Arabia. In addition, low

reliance on leverage has enabled consumers to keep

spending despite the credit crunch



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19

* Does not include UAE and KuwaitSource: EIU as of August 2009


Healthy contributions from private sector investment and government consumption have added todomestic demand resilience

2008-2009e Gross Fixed Investment & Stockbuilding Real Growth

2008-2009e Government Consumption Real Growth

(5%)

4% 4%6%

(25%)

12%

(12%)

(16%) (16%)

(21%)

MENA* S. Asia GCC* NorthAfrica

Turkey China Braz il Japan Malaysia US

5%

11%

5%

6%

4%

12%

4% 4%

8%

2%

MENA* S. Asia GCC* North

Africa

Turkey China Brazil Japan Malaysia US

Fixed investments for the most part have continued at or

above historic levels for the region. The primary exception to

this case is Turkey, which is expected to post negative growth

of 25%. In the rest of the region businesses continue to invest,

in particular in North Africa, where fixed investment is expected

to increase by 6%

A primary driver of this continued investment is pent-up

demand across many industries, which is spurring private

sector investment. Importantly, a lot of this pent-up demand is in

infrastructure-related industries such as hospitals and schools

where such investments cannot be delayed

Significant investment is also being seen in industries in which

the region enjoys a competitive advantage, such as

petrochemicals and logistics

In terms of government consumption, countries across the

region are expected to post healthy increases. Turkey will post

an increase of 5%, while MENA is up 5% and South Asia is up

11%. These rates are above most other countries, including

both developed and emerging markets

The growth in government consumption is an important indicator

of the ability of these governments to enact counter-cyclicalpolicies


20/34



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21


Diversification efforts on the part of regional governments

have paid-off

In 1975, oil revenues accounted for 47% of Saudi Arabias

GDP. In 2008, this had declined to 31%, with transportation

& communication, services and manufacturing more than

doubling their contribution to GDP Similarly for India, in 1974/1975, agriculture revenues

accounted for 43% of GDP. By 2007/2008, this contribution

had decreased to 20% and contributions of trade,

transportation & communications had increased by c. 75%

while business, financial & real estate services had doubled

This trend is ongoing and diversification efforts remain a

priority for regional governments. For example;

In the GCC, between 2000 and 2006, hydrocarbon

contribution dropped from 35% of GDP to 32% of GDP while

manufacturing and construction, finance, business & real

estate and services all accounted for a greater proportion of

GDP in 2006 than in 2000

In Turkey, between 2000 and 2008, agriculture contribution

to GDP declined by 3%, while transportation and

communication account for a greater proportion of GDP

Diversification efforts and the leveraging of strategic competitive

advantages has allowed the region to become a global hubfor several industries including petrochemicals and

transportation

Note: GDP comparison based on real terms. * Real GDP based on 1999/2000 prices for GCC, India & Turkey and 2002/2003 prices for EgyptSource: McKinsey & Company, Central Banks, Turkstat, BAS-ML, Beltone, News sources

Long-term reform and investment initiatives by regional governments have successfully broadenedthe regions economic base and created diversified economies

Real GDP Contribution by Sector*

India (2007/2008)Turkey (2008)

Egypt (2007/2008)GCC (2006)

Agriculture,forestry &fishing, mining& quarrying

Manufacturing,construction,electricity,

gas & water

Trade,hotels,transport

& comm.

Business,financial &real estateservices

Publicadministration &defense & other

20%

24%28%

15%

13%

Manufacturing

Transportation& comm.

Wholesale& retail

Financialservices

Agri-culture

Other

ConstructionRealestate

6%

15%13%

10%

24%

5%

9%

18%

Other

Manufacturing

Oil & gas

Agriculture

Wholesale& retail

Financialservices

SuezCanal

Construction

Realestate

26%

15%

5%15%

14%

11%

8%

3%4%Hydrocarbons

Transport &comm.

Finance,business &

real estate

Services

Manu-facturing

Other

32%

7%

15%10%

10%

7%

19%Constr-uction

Explaining the Last Twelve Months Low Leverage


22/34

10% 11%12% 12%

13% 13% 13%

15%16% 16% 16% 16%

18% 18% 19%

21%

Tunisia

Morocco

Lebanon

Pakistan

Algeria

India

UAE

Egypt

Qatar

Libya

Oman

Kuwait

Bahrain

Jordan

Turkey

Saudi

Arabia

22Source: IMF / country authorities, Credit Suisse, Nomura

Mortgage penetration as % of GDP

p a g t a t t ag

Capital Adequacy Ratios of MENASA Banks

2008 Loans-to-Deposits of MENASA Banks

55%

78%83% 90%

92%

101%105%

112% 115%120%

Egypt

India

Turkey

Saudi

Arabia

Kuwait

GCC

Average

USA

UAE

Qatar

UK

Strong capitalization of the regions banks enabled them to absorb the impact of the globaldownturn

The regions banks tend to have lower exposure to systemic

financial vulnerabilities given the more restrictive regulations

and less sophisticated nature of the financial markets

Central banks in the region have acted conservatively in setting

Capital Adequacy Ratios (CARs), requiring ratios above Basel IIrequirements. As a result of these relatively high CARs, most of

the banks in the region have been able to internally absorb

rising NPLs

Most banks, particularly those in countries such as Egypt, India

and Turkey, have not been reliant on wholesale funding

mechanisms for growth, as reflected by their relatively low

loans-to-deposits ratios

In the few cases where banks relied on wholesale funding,

most notably in the UAE, Kuwait and Qatar, the governments

provided necessary support as required

An important point to note is the traditional linkages between

these governments and the financial sector (ownership in many

cases), with governments indicating a clear willingness to

intervene to ensure the well-being of the financial system

A lack of structured products in the banking system and on

balance sheets and minimal exposure to toxic assets from

Western Markets have also contributed to relative stability and

solvency

Note: Bahrain figure as of end of 2008 and only includes conventional retail banks; Kuwait and Qatar figures asof Dec 2008; Oman, Algeria and Libya figures as of end of 2007; Saudi Arabia figure as of end of 2007; UAEfigure as of June 2008; All remaining figures are 2008 or latest available

Basel II requirement: 8%

Explaining the Last Twelve Months Low Leverage


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23

0%

5%

10%

15%

20%

25%

Croatia

Malaysia

Ukrain

e

USA

UK

Bulgaria

Romania

Braz

il

German

y

Thailan

d

Russia

Indonesia

Chin

a

Japa

n

p g g

Corporates in the region were in a good position pre-crisis to

navigate through the downturn given their low degree of

leverage

Average debt to capital ratios in MENASA are well below

those in other markets. This low leverage is driven in part by

three factors: (a) the lack of sophisticated financial productsin the market; (b) the need for companies to maintain

flexible balance sheets to capitalize on growth opportunities;

and (c) the equity culture inherent in the region

Consumers in the region are also relatively under-levered.

A primary indicator of this is the low degree of retail credit

penetration in the region, when compared to developed

markets. As a result, consumers have not been forced to cut

back spending due to over-leverage, indicating that the

temporary slowdown was more of a crisis of confidence than

anything else and that there remains significant potential for

growth in consumer spending

Retail loans as a % of GDP are much lower in the region

versus other countries

Mortgage penetration is also low in the region, ranging from

0.1% of GDP in Egypt to 12% in the UAE compared to 82%

and 73% in the UK and US, respectively

Source: Bloomberg, BAS-ML

Note: Based on companies with market caps > US$ 150 million and average daily trading values > US$ 2 million

Mortgage penetration as % of GDP

Corporate Debt /Total Capital for Listed Companies in MENA & South Asia

Retail Loans* as % of GDP in MENA and South Asia

* Excludes mortgages; Note: Most data as of end-2008

55%

47% 46%

25%

18%

Western Europe United States Japan South Asia MENA

Corporates and consumers were not as highly levered and therefore were not forced to cut backspending

Oman

Qata

r

Egyp

t

Kuwait

Turkey

UAE

India

KSA

Explaining the Last Twelve Months Sovereign Strength


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24

p g g g

Source: IMF, BAS-ML, McKinsey & Company, Steffen Hertog, News sources

Several regional governments have accumulated large reserves during the last five years

GCC Breakeven Oil Price* (2008, $ per barrel)

2008 Estimated Assets of Major SWFs (US$ billion)

* Based on official 2008 budget targets**Kuwait announced one-off budget transfer of c. US$20 billion to capitalize social security system

Over the past few years government budgets amongst the oil

producers have been set conservatively and as a result, even at

low oil prices they break even. Breakeven oil prices for most

GCC government budgets in 2008 remained below US$

50/barrel, despite the rise in the average oil price to c. US$

100/barrel. As a result, it is estimated that in 2008, the GCC

had a budget surplus of c. 30% of GDP or c. US$ 315 billion

Conservative budgets coupled with the oil windfall from the last

five years has allowed regional governments to accumulate

substantial wealth

The extent of this wealth is reflected in the size of accumulated

foreign reserves and sovereign wealth funds

Based on current unofficial estimates, its existing

accumulated reserves and overseas assets alone would

enable Qatar to continue 2008 spending levels for more

than two years, Saudi Arabia to continue for more than

three, Kuwait more than four, and the UAE for more than

five years (without further revenues)

Based on IMF data, official reserves of MENA (excluding

Turkey) were US$ 181 billion in 2004 and have grown to

US$ 866 billion in 2008. The oil exporting economies, i.e.

the GCC, Algeria and Libya in particular, have

accumulated vast reserves

The region has some of the largest Sovereign Wealth Funds(SWFs) in the world. These SWFs can and have been

called upon to provide domestic macroeconomic and

financial stability * Bar represents maximum figure in range

0

20

40

60

80

100

Saudi

Arabia

UAE Qatar Oman Bahrain Kuwait**

2008averageoil price

500-875

32

350

371

250

125

60Qatar Investment Authority

Russian Wealth Fund

Russian Reserve Fund

Kuwait Investment Authority

Norway Pension Fund - Global

Saudi Arabian Monetary Authority

Abu Dhabi Investment Authority*

Explaining the Last Twelve Months Sovereign Strength


25/34

25Source: Nomura, Credit Suisse, MEED, IMF, BAS-ML, News sources

Regional governments have committed to continue

spending, especially in the GCC, where accumulated reserves

will be called on to finance a potential budget deficit of 5% of

GDP in 2009 or an estimated US$ 44 billion

Countries, such as the UAE, Bahrain and Oman, have

increased budgets for 2009 with the UAE budget 21%

higher than for 2008

Breakdown of budgets demonstrates the focus on sectors

that will benefit long-term sustainability such as education

and healthcare

MENA countries have recently continued c. US$ 2 trillion

worth of projects supporting long-term economicdevelopment

Saudi Arabia has established a 5-year US$ 400 billion

infrastructure investment plan earmarked for airports,

seaports, transport hubs, schools, universities, and

knowledge-based industries

Abu Dhabi is planning to invest an estimated US$ 100billion between now and 2030 to develop its petrochemicals

industry

Qatar continues to invest in projects such as the New Doha

Port project and the development of Education City

In Algeria planned spending on energy projects between

2009 and 2014 is US$ 69 billion

Backed by large reserves, MENA governments are committed to bolstering economic growththrough infrastructure and development spending

Saudi Arabia Budget Breakdown (2009)

UAE Budget Breakdown (2009)

Education &manpower

(26%)

Health & socialaffairs(11%)

Municipalityservices

(4%)Telecomm. &transport

(4%)

Other(32%)

Water, agriculture& infrastructure

(7%)

Credit insts &gov't programs

(16%)

Note: Total 2009 budget = US$ 127 billion

Note: Total 2009 budget = US$ 11.5 billion; Education allocation assumed to be part of social services

Education

(23%)

Other socialservices(15%)

Justice &security(36%)

Social benefits(13%)

Infrastructure

(5%)

Other(8%)


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26

The MENASA region is projected to be one of the fastest growing regions in the world driven bypetrodollars, people, policies and pent-up demand resulting from historic underinvestment in keysectors

Looking Forward With Confidence: What Will Drive FurtherGrowth?

Looking Forward With Confidence Macro perspective


27/34

Pent-up demand

Historic underinvestment in key sectors of regional economies

has resulted in severe capacity shortfall and under-

penetration

Pent up demand and strong investment opportunities e.g.

39,000 hospitals to reach OECD levels by 2017

7,000 schools required to meet regional demand by 2015

Policies

Regional governments drive to achieve:

Economic diversification, liberalization & deregulation

Infrastructure development & transition to knowledge-

based economies

Creates privatization and public-private-partnership

opportunities, as well as a favorable investment environment

8.5% 8.1%

5.9% 5.7%4.9%

4.6% 4.5%

4.1% 3.9% 3.8% 3.5%2.7%

1.4% 1.3%

C

hina

India

MENAS

A

NorthA

frica

Pakist

anGC

C

MEN

A

Braz

il

LatA

m

Leva

nt

Turke

y

W

orld

EU15 US

Source: EIU as of July 2009, McKinsey & Company, Abraaj analysis, BP Statistical Review of World Energy as of June 2009 27

People

Sizeable population of c.1.6 billion people expected to grow to

c.1.75 billion by 2013. MENA will grow by 1.7% p.a.

Growing middle-class & rising incomes, combined with

increased urbanization and labour mobility

Low household leverage

Latent consumer demand for goods and services, and

infrastructure

Impetus for labor intensive industries growth

Petrodollars

MENA has 44% of global crude oil reserves with only 29%

production share, 27% of natural gas reserves with only 14%

production share

Lowest lifting costs $ 2-6 / bbl vs. $ 18 / bbl in US

McKinsey estimates the GCC will receive revenues of US$ 5

trillion to US$ 9 trillion by 2020 if oil prices average US$ 50 to

US$ 100 per barrel

Real GDP Growth (10-13 CAGR)

Projected to beone of the

fastest growingregions in the

world

Looking Forward With ConfidencePetrodollars


28/34

44%

6%11% 10%

29%

16%22%

8%

MENA North America Europe & Eurasia S. & Cent.America

Oil Proved Reserves Oil Production

28

0.6

1.1 1.51.9

2.4 2.83.2

0.9

1.11.3

1.5

0.8

1.0

1.3

1.5

1.5

1.9

2.2

2.6

2007 2008 2010 2012 2014 2016 2018 2020

Source: IEA, BP Statistical Review of World Energy as of June 2009, BAS-ML, EIU as of July 2009, McKinsey & Company

MENAs vast hydrocarbon resources are a critical source of

revenue, specifically for the GCC, with hydrocarbons

accounting for 60%-90%+ of government revenues

In the near-term, the global economic crisis has led to lower

demand for oil and gas. However, on the back of improved

economic indicators, large infrastructure focused stimuluspackages, rallies in the equities markets around the world and a

weak U.S. dollar, investors are now expecting demand to

climb. The result has been a steady increase and stabilization

of oil prices over the past few months

In the medium-term, oil prices are expected to rise in

response to an increase in global consumption as the globaleconomy recovers starting in 2010 and the loose monetary and

fiscal policies governments have put in place to combat the

recession, especially in Asia, take effect. Bloomberg consensus

forecasts average oil prices of US$ 75 per barrel in 2010 and

US$ 85 per barrel in 2011

In the long-term, McKinsey estimates that the GCC will receiverevenues of US$ 5 trillion through 2020 even if oil prices were

to average only US$ 50 / barrel over that period and revenue of

US$ 9 trillion with oil prices at an average of US$ 100 / barrel

The MENA region enjoys the highest reserves to production

ratio in the world at 1.5x compared to 0.4x in North America,

and easily the lowest cost of extraction globally.Consequently, the regions share of global production is

expected to increase even further over time, providing a long-

term source of revenues

Hydrocarbons are expected to continue to generate significant income for the region

Oil price: US$ 30

Oil price: US$ 50

Oil price: US$ 70

Oil price: US$ 100

Cumulative GCC Oil Revenues (US$ trillions)

MENA Reserves to Production Ratio

1.5x

0.4x 0.5x

1.2x

Reserves / Production Ratio

0.61.1

2.4

3.8

5.1

6.4

7.6

8.8

Looking Forward with Confidence People


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29

LevantNorth AfricaGCCTurkeyPakistanIndia

2008 2009 2010 2011 2012 2013

$802 $791$874

$978

$1,101 $1,233$1,132 $1,070 $1,166

$1,289$1,422

$1,562


2008 2009 2010 2011 2012 2013

$802 $791$874

$978

$1,101 $1,233$1,132 $1,070 $1,166

$1,289$1,422

$1,562


2008 2009 2010 2011 2012 2013

$802 $791$874

$978

$1,101 $1,233$1,132 $1,070 $1,166

$1,289$1,422

$1,562

Source: EIU as of July 2009, UN Population Division as of July 2009, AME Info

MENASAs population is c. 1.6 billion (MENA has a

population of c. 285 million while South Asia contributes the

rest) and is expected to grow by 1.6% p.a. to c.1.75 billion by

2013. MENAs population will grow by 1.7% p.a.

The region is home to a rising middle class experiencing

tremendous growth in income GDP per capita has grown at a CAGR of 16% from 2003 to

2008 and is expected to increase at a CAGR of 6% to 2013

This wealth creation will support continued consumption of

goods and services

Private consumption in MENASA is expected to increase

at a rate of 8% per year from 2008 to 2013

General Electric (GE) generated US$ 8 billion in revenues

from its Middle East and Africa business in 2007, an

increase of ~45% from 2006

Population growth will also lead to increased need for hard

infrastructure such as housing, roads and energy, as well as

soft infrastructure such as healthcare and education, in

addition to financial services and consumer goods

Over half the regions population is under the age of 25

resulting in increased per capita spending as the young

population enters the workforce

The proportion of people aged 55 and above will increase

from c. 10% of the population in 2005 to c. 15% in 2025 further

increasing demand for local services such as healthcare

A young growing population will continue to drive demand for goods and services, provide the laborforce for future growth and development and spur governments to continue investing

MENASA Private Consumption (US$ billions)

Demographic Breakdown

8%MENASA

08-13CAGR

Agegroup

0-14

15-24

25-34

35-44

45-54

26%

7%

25%

7%

34%

4%

31%

5%

55-64

65+

WorkpopSA:

42%/547mm

WorkpopSA:

50%

/838mm

2005SA / MENA total pop. (millions):

1,296 / 272


1,678 / 357

WorkpopMENA:

44%/120mm

WorkpopMENA:

52%

/186mm

South Asia MENA

Agegroup

0-14

15-24

25-34

35-44

45-54

26%

7%

25%

7%

34%

4%

31%

5%

55-64

65+

WorkpopSA:

42%/547mm

WorkpopSA:

50%

/838mm


1,296 / 272


1,678 / 357

WorkpopMENA:

44%/120mm

WorkpopMENA:

52%

/186mm

South Asia MENA

Looking Forward with Confidence Policies


30/34

Governments have enacted economic reforms to boost foreign

investment and ownership

Broad privatization programs exist in several industries including

energy, manufacturing and banking and financial services

India has established over 400 economic zones to promote

growth and investment

30

Governments have made efforts to open their economies, improve the ease of doing business andattract foreign investment. They are also committed to diversification and domestic investment

Source: EIU as of July 2009, McKinsey & Co., News articles, WTO

Jordan

Qatar

TunisiaLebanon

UAE

Kuwait

Morocco

AlgeriaLibya Egypt

Turkey

Bahrain

SaudiArabia

Pakistan

India

Oman

Privatization programs targeting several sectors including banking and financial services, energy and

commodities, water and electricity, transportation and education. For example; Jordans privatization program

has completed over 60 transactions; the UAE has successfully divested major transportation operations (Air

Arabia and DP World); Saudi Arabia has a privatization program with a pipeline of assets worth

approximately US$ 800 billion

Low or no tax policies are helping the countries attract foreign capital and talent

Increasing international partnerships & global cooperation

Growing capital markets, favorable rules on foreign

ownership and privatization programs have led to

increasing foreign investment

FDI flows as a % of GDP more than doubled between 2000

and 2008

North Africa

India & Pakistan

GCC, Turkey & the Levant

13 out of 16MENASA countriesare members of the

WTO; Algeria,Lebanon and Libya

still need to gainmembership

Looking Forward with Confidence Pent-up Demand


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142

5060

1587544

South Asia North Africa GCC

Installed Gigawatt Capacity Required

350% 314%

122%85% 56% 50% 39% 27% 19%

UK

Germ

any US

China

Saud

iArab

iaTu

rkey

India

Egypt

Pakis

tan

31

Historic underinvestment in regional economies has resulted in severe capacity shortfalls & under-penetration across various sectors creating pent-up demand and strong investment opportunities

Source: EIU, McKinsey & Company, Citi, World Bank, UN, Euromonitor, Abraaj analysis

Power Generation Capacity (Gigawatts)

Investment

requirementUS$ 50bn

Investment

requirementUS$ 90bn

Low Cost Airlines (Share of Seat Capacity)

Healthcare (Total Hospitals Required)

Gap 39,000Hospitals

Financial Services (Banking Assets as % of 2008 GDP)

26%24%

9%

5%

USA Europe Asia MENA

Dairy Consumption Fluid Milk (Annual Litres / Kilo Per Capita)

Education (Total Schools Required)

50,629

57,230Gap 7,000Schools

Investmentrequirement

US$ 18bn

13,827 15,834

37,374

MENASA 2007 MENASA 2017

At OECD levels of beds / 1,000 of population

MENASA level of beds / 1,000 of population

47,773

53,8362,857

3,393

MENA / SA current MENA / SA 2015

South Asia MENA

89.1 87.572.2

65.9

29.2 28.7 25.2 20.8 20.0 19.7 14.5

US

Rus

sia EU Braz

il

Bah

rain

Qatar UA

EEg

ypt

KSA

K

uwait

Oman

by 2017; by 2030; by 2015

Conclusions


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32

The MENASA region includes countries with an increasing importance to the global

economy

The region has been buffered from the worst effects of the global downturn due to

the structural strength of its constituent economies including strong domestic

demand and low-reliance on Western consumers, hydrocarbon reserves,diversification initiatives, low systemic leverage and sovereign strength

Key sectors in the region continue to record double-digit growth even in the face of

the worst global economic crisis in more than a generation

The future outlook will be better still as years of reform and state investment

initiatives bear fruit and record hydrocarbon revenues and a demographic dividend

all contribute to real economy growth


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