Thursday, 5 April 2012
Arab Spring sparks demand for greater transparency and accountability in Gulf
The Arab Spring may not have spread to the Gulf region in any meaningful way apart from some serious civil unrest in Bahrain and protests in Oman and Kuwait. But it has sparked a rise in demand for transparency, accountability and effective risk management in the region, according to experts at the MultaQa conference in Qatar last month.
Pearl Square in Bahrain became a focal point for protests in 2011
Qatar itself has also benefited from the turmoil seen in other parts of the Middle East and North Africa as the country’s rulers gained support and recognition for its efforts to seek peaceful solutions in countries such as Libya and more recently Syria, according to some at the event.
Walid Sidani, CEO of Abu Dhabi International Insurance Company (Adnic) said that the Arab Spring had certainly helped spark demand for more transparency in general in the region and that the risk and insurance sector ought to take advantage of the new spirit of openness to improve dialogue and relations with the regulators at least.
“There are over 20 companies represented here but only two to three regulators therefore there is a gap there. The evolution of the market is clear and it has to be closer. We need a better representation of regulators at events like this,” said the insurer.
“I really believe that 2012 will represent a paradigm shift in this region. The Arab Spring means that a new level of transparency has to occur. Consumers are demanding more from governments and stakeholders are deciding what they want from companies. Companies need to look closely at how that translates into value. Corporate governance under the influence of transparency will happen because of the influence of the Arab Spring and this will also influence regulation,” added Mr Sidani.
Fetooh Al Zayani, Partner with JZW Solutions in Bahrain, is keen to drive the creation of a more unified and professional risk management community in the GCC [see news on www.commercialriskeurope.com]. She believes that the call for greater transparency and accountability at the political level should transfer to regulation and business.
“Regulatory bodies, central banks and the like are all driving standards and companies are coming up with manuals so the drive comes from regulation but also political and public pressure is being applied. In Bahrain there has been public and political pressure and from the media to apply more risk management,” Ms Zayani told Commercial Risk Europe in an interview during the conference.
“This is a crucial step to take, therefore the awareness is there. The GCC as a region will support Bahrain with $10bn over the next 10 years and all these funds and how they are managed has to be part of risk management therefore there is a lot more accountability for the government and people are asking governments to tell them what they are going to do about it,” she added.
Jose Ribeiro, Director International Markets at Lloyd’s was a speaker at the event organised by Global Re magazine in partnership with the Qatar Financial Centre. He, like many others at the event, believes that Qatar will benefit from its reaction to the Arab Spring and could help its longer-term goal of becoming the insurance hub for the GCC region.
“The development of Qatar into a regional platform over the last few years has been very impressive. It has managed to stay insulated from the political and social unrest and the Qatar government has played a key role in helping to solve conflicts. That is a big advantage as it gives Qatar leverage and this may impact the development of the insurance and reinsurance industry in this country,” he said.