DUBAI
Bosch, a global supplier of technology and services, experienced modest growth in 2016 due to political instability and low oil prices, according to the company’s regional head.
The company posted single digit growth last year, compared to the 12 per cent growth reported in 2015.
“When we look at the overall region, we had a moderate growth in 2016,” said Volker Bischoff, general manager & vice president, Robert Bosch Middle East.
“We’re used to strong growth in the double digit range, and that proved to be a challenge last year,” he added, in an interview with Gulf News.
Bischoff offered two reasons for this sub-optimal performance: Firstly, political instability in Iraq, Syria, and Yemen, markets that were performing well for Bosch. The company executive described this adjustment as “tough.”
Secondly, Bischoff referred to the economic slowdown witnessed throughout the region last year, placing specific blame on low oil prices.
“Governments had less money to spend on infrastructure and construction,” he said, adding that there had been issues getting paid in some cases.
Last year, Bischoff said, one of the challenges was accounts receivable, and in certain countries, getting payments in on time was difficult.
One division that suffered from the slowdown in projects and government spending was Bosch’s Security Systems business.
“Particularly with cameras and intrusion detection equipment, we felt the heat in this segment,” Bischoff said.
Conversely, in its 2015 annual financial results for the Middle East, Bosch noted that the Security Systems division posted the highest growth for the company.
Striking a more optimistic note on his outlook for 2017, the senior executive noted that Bosch was expecting higher growth this year.
According to Bischoff, the company is “aiming for double digit growth,” whilst noting that it was on his radar for this year.
He added that the diversification of economies in the region would present new opportunities for Bosch, whilst things like population growth, and a stabilising of oil prices, would also contribute to a more robust increase in business.
For the past few years, the UAE and Saudi Arabia have consistently been Bosch’s best performing markets, and that continued to be the case in 2016.
“I see great growth in these countries in the future. Things like Saudi’s Vision 2030 and Dubai’s Expo 2020 will drive business,” Bischoff said.
He noted that Bosch would look to increase its business in Saudi Arabia, by expanding the company’s presence there, and adding more business divisions.
“So far, we only have a security technology business. Now, we’ll add automotive and mobility businesses to that,” he said.
However, Pakistan is increasingly becoming an important market for Bosch, he added.
With a population of nearly 200 million people, and a GDP growth of 5 per cent, Bischoff views it as a very promising location.
Bosch opened its first office in the country in February 2016.
“Pakistan is a very interesting market,” Bischoff said, adding: “With the middle class increasing, the base of people who can afford our products will increase, and we believe the country’s GDP will continue to grow.”
