According to sources from Global Research states that the net revenues earned through the consultants in the GCC region surged to touch $3.3Bn the previous year.
With the public sector working in full flow and pushing in much harder in tandem with various governments across the vast GCC economies, who are currently investing heavily for hiring up of consultants who support them in diversification of their hydrocarbon-dependent economies have recorded huge success by crossing a $1billion (Dh3.67bn) consulting revenue in 2019 for the first time and that is 10.2 percentage higher than the 2018 statistics.
As per the new report guided by Source Global Research-A firm specializing mainly in the global professional services market research have stated that Saudi Arabia, the biggest Arab leagues economy as well as Opec’s largest oil exporter has been the pivotal driving force behind the public sector work for consultants the previous year. The kingdom’s net consulting revenue surged ahead by over 12 percentage to touch $1.6Bn mark. The net consulting market across the GCC region recorded a growth of $3.3Bn, a surge of overall 9.9 percent.
Zoë Stumpf, head of consulting market trends at Source Global Research, stated that “They expect further growth in consulting demand right across the region to the top of 2020. In the vast Saudi market, there’s an enormous amount of support needed to shape the detailed strategies underpinning Vision 2030, and further work are going to be required to show those strategies into reality.”
There is a huge demand in the public sector, clients turned to consultants for support with migration to the cloud, data and analytics, pushing technology consulting services revenue 10.7 per cent higher to $1.2bn last year. Financial services mandates also performed well in 2019, with revenues growing 9.3 per cent to $698 million, consistent with the report.
Saudi Arabia’s start-ups hit record number of deals and funding in 2019. Governments within the GCC, which accounts for a few third of the world’s proven oil reserves, try to radically transform their economies faraway from oil. The push for diversification came after the three-year oil price slump, which began in 2014 and dented hydrocarbon revenue streams of governments within the region. It forced policymakers cut spending, shelve projects and take away subsidies to scale back the burden on the general public.
All GCC states are now running their own separate economic transformation programmes like Saudi Arabia’s Visions 2030 and Abu Dhabi’s Dh50 billion Ghadan 21 schemes. Dubai’s Expo 2020 has also helped consulting business within the region and Source Global said there’s still a robust pipeline of public sector work requiring consulting support.
However, Saudi Arabia’s planned restrictions on the utilization of foreign consulting firms on public sector projects “could affect the demand pipeline of foreign consulting firms”, consistent with Stumpf.
Full enforcement of the decree could mean that a scarcity of local capacity including the lack to show to foreign firms could disrupt transformation work, the report noted.
Ms Stumpf stated further “that the spread of the deadly Coronavirus through the region and subsequent travel restriction in its wake are another impediment to consulting business growth this year. Consultants, who have to fly out into the region on a weekly basis to deliver projects for clients, will now get to think creatively about how they will still deliver the client’s project from a virtual location.
This may be possible for a few projects, but impossible for others.” She further noted that “The wider impact of the Coronavirus on the GCC consulting industry may impact existing projects, especially those requiring consultants working extensively in their clients’ offices. However, strategy work is going to be less impacted as consulting firms can do most of this from their own offices.”