Get rid of projects that generate zero value: Al Ghurair

Abdulaziz Al Ghurair. - Supplied photo

Every company and sector will have to come up with a solution and they should not expect that government will bail out every company, said Abdulaziz Al Ghurair, chairman of the UAE Banks Federation.
While addressing a virtual press conference on Sunday, Al Ghurair urged companies to revise their business models and get rid of pet projects that generate zero revenues and destroy shareholders' value.
He noted that situation related to coronavirus is under control and now there is a clarity of which area are under semi-lockdown and where people can move freely based on the discovery of new cases.
"Central Bank wants to ensure that the economy benefits from the stimulus package. It is nice to have big numbers but if it doesn't benefit individuals or economy, we will be stuck in the sand," he said.
The Central Bank earlier this month doubled the size of its stimulus package to Dh256 billion and allowed banks and finance companies in the country to extend deferrals of principal and interest payments to their customers until December 31, 2020.
"The good news is that we don't need more (liquidity). We have enough liquidity to meet our business requirements to support economy to ensure we come out of this challenge. It is enough to last for few years at least to fund our expansion of loans," he said during the virtual conference.
He assured that the relief funds will be used exclusively for commercial companies and individuals and not for GREs (government-related entities) or government institutions. Due to coronavirus outbreak, demand for services and products have plummeted in the country.
"Next challenge is a demand for services. There is no body shopping, the demand is dead. Therefore, creating demand is the next major challenge," he added.
Al Ghurair stressed that every business has to re-examine its model and trim down their operations.
The UAE Bank Federation chairman said that the message from the leadership is clear that the efforts that have been put in to develop the economy over the past five decades cannot be undone by just one-year.
- waheedabbas@khaleejtimes.com