Author - Truth Consultancy

September 2019

Positive effects of low inflation on the economy and consumers

The Managing Partner of Truth Economic & Management Consultancy, Reda Mosallam, said that the continuous rise in the fees of a large number of schools increased the burden on consumers.

He added that despite the decline in housing prices and rental values, during the current year compared to last year in tangible proportions, the lack of lower prices of water, electricity and gas, reduced the impact of the decline in rents and housing prices, as well as the absence of a realistic decline in the prices of many means of transport, affected by the decline World oil prices.

He pointed out that the decline in inflation, during the first seven months of this year was not absolute, but came as a result compared to the same period last year.

He stressed the importance of lower prices for «Entertainment and Culture », which has seen the largest increase in prices this year, as well as the prices of restaurants and hotels, to be accessible to a larger population.

Real estate demanding a mechanism for coordination and integration between real estate projects

The General Manager of Truth Economic & Management Consultancy, Reda Mosallam, called for supporting the growth in the various sectors related to the real estate sector. Growth in these sectors supports growth in the real estate sector.

He called for attention to diversify in different products in the real estate sector, to attract buyers from different categories, with no focus on the residential sector and office and commercial space for only one category, but for different categories.

He considers that providing real estate market data to developers is very important, as it helps developers to identify market needs and choose a real estate product.

He pointed out that the growth of the real estate sector should be slowed down for a certain period in order to absorb the surplus units and determine the trends of the real estate sector in the future. Pointing out that the past period has witnessed a large and unaccounted for expansion in the sector on the basis of high return.

He indicate the importance of the UAE economy and its uniqueness across the Gulf region, in terms of its dependence on many sectors of growth, not one sector, including oil and gas, tourism, real estate, retail, re-export, infrastructure, and others.

July 2019

Experts and specialists of the al-Ittihad: The quality of infrastructure, the development of services and the ease of procedures are the main bases for the competitiveness of the state

“The UAE’s achievements in non-oil sector have revealed that the UAE is moving into a new stage of development and progress based on innovation, which will accelerate economic growth and strengthen the country’s position in global indices,” said Reda Mosallam, Managing Partner of Truth Economic & Management Consultancy.

The current strategy of the State includes strengthening the role of innovation in the national economy, promoting and encouraging the culture of innovation and Researching & Developing in the private sector, providing innovative smart services to clients based on innovation, enhancing the attractiveness of the State to foreign investments, Community and promote their roles, and encourage and support the tourism sector at the local and global levels, as a cornerstone of the post-oil economy plan.

He pointed out that the indicators of foreign trade confirm openness to the world as a component of international economic relations, which contributed to the success of diversification policies, pointing out that the estimates of the gross domestic product for 2018 in real prices «base year 2010» amounted to about 1442.5 billion dirhams at the level of the state, Approximately 1418 billion dirhams at the end of 2017.

12.3% of Abu Dhabi households spending Ramadan on food and beverages

“While the overall cost of housing in Abu Dhabi has dropped in the past 12 months, the cost of electricity, water and gas have risen as prices become free,” said Reda Mosallam, general manager of Truth Economic Consultancy.

He added to the «Emarat alyoum», The increase in households’ expenditure on transport in the second place in spending is due to the rise in gasoline prices, which witnessed a significant increase in May last year. He pointed out that the percentage of expenditure on food and beverages is relatively high due to consumer behavior in societies Especially in Ramadan.

June 2019

Liquid assets of banks at the Central Bank grow 2% to 301 billion

Reda Mosallam, the economic and financial expert, notes that the strong position of the banking sector in the UAE reveals the distinguished supervisory role of the central bank. For years, it has implemented an effective preventive policy that does not allow banks to operate as it did during the years of the global financial crisis – 2008. Without a doubt, just increasing the liquidity and availability of banks is very important and the central bank urges banks to increase safe lending as well as increase their public allocations, which is much better for both big and small banks.

He sees that the small banks in the country need to merge and create giant banking entities to strengthen competition in the market in addition to increasing the solvency of the banking sector as a whole to be able to cope with the challenges faced by banking in the state and the region,Which calls for a strong tendency to merge, because of the many benefits to the banking sector.

February 2019

Experts call on banks to ease their tightening on lending

“The majority of the economic sectors in the country are in dire need of lending. The unprecedented increase in deposits in banks confirms the existence of unutilized funds. Consequently, lending mechanisms should be reconsidered because lending at present is the main driver of the economy, Especially as the region around us is experiencing an economic slowdown that seems to be going on indefinitely” Reda Mosallam said, Managing Partner of Truth Economic & Management Consultancy.

Therefore, the majority of the banks in tightening of lending, as currently, is unjustified, especially for small and medium-sized companies that represent the mainstay of the economy. These projects provide sufficient guarantees for banks. Today, small and medium-sized companies and projects have already been suspended for lack of adequate funding which harm the economy and stimulus plans.

January 2019

December 2018

Experts demand cuts in “unnecessary” consumer imports, industry support and exports

The general manager of Truth Economic Consultancy, Reda Mosallam, called for a review of unnecessary or recreational consumer imports to Abu Dhabi, which does not provide added value to the emirate’s economy at present, especially after it achieved a large and unjustified increase in a short time.

He said that the increase in consumer imports had a negative effect on the national currency and the national reserve of foreign currencies. He expected that part of the consumer imports were not directed to domestic consumption, but were necessarily used in re-exports, which are an important and required part.

He pointed out that there was no significant population increase justifying the substantial increase in consumer goods. “The increase in value may partly be due to higher prices, not necessarily in imported quantities,” he said.

He stressed that reducing the consumption of recreational imports will support the reduction of the current account deficit, and reflected on the improved balance of payments, especially as there is a trade deficit in favor of Abu Dhabi partners.

He called to pay attention to the imports of production in the industry and export-oriented, as well as provide more incentives and facilities to increase industrial activity, the number of existing factories, and expansion in it to support domestic production and export.

He stressed that the increase of exports by 10% is a very positive element, and provides great value added to the economy in terms of attracting difficult currencies, opening up new markets for the state, and achieve a reputation for a large commercial abroad.

He added that Abu Dhabi’s success in increasing the value of re-exports by 16.6% contributes to making the emirate a major re-export hub in the region and Dubai, which has taken very important steps in this field, pointing out that there is high infrastructure and facilities in the logistics, transportation and aviation.

November 2018

Experts: «Freezing» real estate units disable the wheel and damage the economy

Reda Mosallam, General Manager of Truth Economic & Management Consultancy said, “The continued closure of residential or commercial units for more than a year is detrimental to the national economy because it disrupts high-cost economic resources and leads to” intervention “in the market, And the establishment of an unrealistic “upset” balance between supply and demand, which is reflected in the continued increase in rents in relative terms.”

He suggested imposing a fee on closed real estate units up to 20% of the average rental value in the building or area, which would encourage the landlord to put it up for rent, because in this case he would compare between his fees due to closure and the rental yield expected to be put on the market, calling for the use of the proposed fee, if approved, in the development of the real estate sector, and the establishment of real estate projects of economic feasibility.

He stressed the importance of relying on the mechanism of supply and demand for the benefit of all parties in the medium and long term, so that the rental value reflects the real relationship between supply and demand.