Chairman of the Board, Mashreqbank PSC (Mashreq)
H. E. Abdul Aziz Al Ghurair, Chairman of the UAE Banks Federation
Greg Fairlie talks exclusively to Abdul Aziz Al Ghurair, Chairman of the UAE Banks Federation.
Transcript (12 segments)
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Interviewer0:00
His Excellency Abdul Aziz Al Ghurair is Chairman of the UAE Banks Federation and CEO of Mashreq Bank. In an interview with him earlier, he gave me his opinion on different aspects of the UAE economy, including the introduction of VAT, how to help SMEs, and the much-discussed bankruptcy law. He started out by telling me about the launch of the Abdullah Al Ghurair Foundation's Open Learning Scholars Program for young Arabs, in partnership with the world's top university, MIT, in the US.
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Abdul Al Ghurair0:33
This program is giving a micro-master, to be followed by a master degree to Arab students. They can do it from home, from work, and they can have the best combination still living here in the Arab world, working and studying. Hopefully more and more such programs will be available. Our Arab youth will have a choice to go to the classical university on campus, which is great, but those who don't have the time and who cannot afford it, they can come through our program where they can have access to online learning through our partnership. We will be launching more and more of such programs, so giving access to our youth of high-quality education.
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Interviewer1:21
Let's now turn to the broader economy. There's been a lot of talk about the introduction of VAT, or value-added tax, from early next year. Do you think this will spell the end of the tax-free status of the GCC, and particularly the UAE?
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Abdul Al Ghurair1:36
I think the government was wise in giving our people here advance notice. It is a practice done around the world. You know, it is time for people to share the responsibility. While you make money, you also pay, and this is indirect. You know, it's not a direct taxation; it's on sales and services. And I think every citizen and every expat living here also understands why the government is doing this, and I think all of them would like to contribute to the well-being of the nation.
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Interviewer2:23
We know that the SME sector particularly is the hardest hit when the global slowdown or the economy falters. So how do you think the UAE loan restructuring scheme will help?
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Abdul Al Ghurair2:34
I think it will be appreciated both from the community, from the customer, from the banking sector, and from our regulator. The banking community has come up with a proactive approach to really ensure that genuine customers who got in trouble, we will work with them.
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Interviewer2:56
There's been much talk about the UAE bankruptcy law. Do you think this is still a priority for the UAE banking sector?
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Abdul Al Ghurair3:03
I think bankruptcy law is a must to have if we want to move to a world-class economy. It is a protection for the customer. The customer knows what the consequence of getting in default with all his borrowing is. It's a way forward for the banking system; they know what they can do, what they cannot do, and it also gives the customer peace of mind. So it's a very transparent system and it's protecting also the economy.
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Interviewer3:42
The UAE mobile wallets have been in the news a lot recently. Is this a clear example, do you think, of the UAE banking sector embracing new technology?
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Abdul Al Ghurair3:52
I think the mobile wallet has progressed extremely well, and banks worked together. Banks worked with the regulator and banks also worked with other government entities to pull, not a fragmented solution, but to pull a comprehensive solution that you can do things on your mobile wallet that hopefully very few countries can offer. This kind of a solution, hopefully in the near future, you will hear a lot more about the mobile wallet.
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Interviewer4:30
Just finally, Your Excellency, should we be worried today about the current price of oil on the economy?
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Abdul Al Ghurair4:37
I am not an oil expert, but the good news is the UAE has been able to diversify their income as a country. We are 70% non-oil based from our GDP. Our target is to go to 95% by 2030. So we had the wisdom to diversify our income as a country, and we'll continue to diversify. Oil, we have no control. It could be 50, 40, 60, and we have to create alternative sources of income for the country. Therefore, we'll need to deal with it, but we don't control it.