Alvarez & Marsal’s latest Middle East Turnaround and Restructuring Survey for Q2 2023 highlights that macroeconomic concerns among GCC leaders are softening, but there is a continuing expectation that businesses will experience distress in the next 12 months. 

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The survey indicates that Gulf CEOs and business leaders who participated in the survey are feeling lower levels of concern about the economic environment, while still acknowledging continued headwinds around cost of capital and inflation.

Key findings for Q2 2023 include:

• The number of respondents who foresee a deterioration in the macro-economic climate over the next 12 months has fallen from 75 percent to 48 percent. The main areas of concern remain cost of capital and inflation.
• Although lower than the Q1’23 survey, a significant majority (70 percent) of respondents still expect an increase in the number of distressed businesses over the next year.
• Almost unchanged was the number of respondents (73 percent) who advocate that financial restructuring should be accompanied by operational restructuring. Similarly consistent is the number who say that this is not frequently happening (76 percent).
• Tax and regulatory changes were identified by 27 percent of respondents as a business challenge, perhaps unsurprisingly given the introduction of the Corporate Tax in the United Arab Emirates (UAE).
• While the outlook for most sectors appears to have improved, retail remains a key sector of concern, with 69 percent of respondents anticipating continued pressures due to tightening consumer wallets and the ongoing shift to digital platforms.

Click to download the Middle East Turnaround and Restructuring Survey for Q2 2023.

Previous reports:

The Middle East Turnaround and Restructuring Survey for Q1 2023.